Equality in Business

10 Apr 2015

Germany recently joined other European nations by enforcing a 30 per cent quota of women to fill supervisory positions in their largest companies and Dr Polly Parker from UQ Business School says Australia should do the same.

“Government-regulated quota is the only way equity will be achieved. It was enforcing quotas that drove change in Europe, particularly in Scandinavian countries,” Dr Parker said.

“The companies with higher percentage of women on the board are more productive and have more positive financial outcomes than men. The data is there,” Dr Parker said.

In 2007, Catalyst found that companies with more women on their boards outperformed those with the least by 53 per cent on return on equity, 42 per cent higher return on sales, and a 66 per cent increase on return on invested capital.

Dr Parker says that a lack of diversity and equality permeates all levels of organisations.

“Boards is one level, but quotas at other levels of the organisation would make a difference too. The CEO level is possibly more important than board level in my opinion as there is a dearth there of women in senior positions,” Dr Parker said.

“We can’t rely on a change at board level for it to filter down, it has to be active.

“We talk about the labyrinth which is a metaphor which came from Alice Eagely as a way of understanding women’s careers.

“On the surface it may appear there is a meritocracy but there are a lot of ways that women are disadvantaged.

“The research shows that gender pay gaps starts 18 months after graduation and it increases from there.

“There are many ways that our organisations and businesses operate that men are given more chances.

“For example, mentoring. Women openly speak about mentoring a lot more than men do. Men don’t see the advice and support they’re given as mentoring. They think it’s just part and pass of what happens.

“There are people looking out for them in different ways right from the start and those examples are hard to quantify because they’re informal yet they are pervasive.”

Dr Parker suggests reforming the way parental leave is structured as a way to encourage diversity.

“One of the things that will make a big difference is shifting from maternity leave to parental leave. In Scandinavian countries, parental leave is divided up. A certain proportion of it has to be taken by men,” Dr Parker said. 

“There are many women who do not take advantage of those leaves because they’re stigmatised even if they take it.

“That won’t go away until men also take leave, and that won’t go away until there is some obligation for parents to split it up and divide the leave so that when we see men taking leave it becomes more acceptable for women to take leave.”

In Australia, women total 17 per cent of directory boards.

Initiatives that encourage gender diversity in business are growing in Australia with the British-based 30% Club joining the efforts to promote gender diversity in May.

The He-for-She campaign and the Champions for Change are pre-existing efforts to positively encourage influential men to embrace gender diversity.  

“Male domination of boards is a pattern that is very well entrenched, so much so that there are international moves to redress it.” Dr Parker said.

“These initiatives recognise that this is not just a women’s problem, but it’s a men problem as well.

“The positive thing is that we are getting lots more initiative to address the issue and it shows how pervasive the issue really is it cuts across industries and its international.”