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Helen Croft: “Boards made up of equal or near equal numbers of men and women outperform their competitors.” What will be the most effective ways to ensure we meet the 30% women on boards target set by Lord Abersoch?
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Helen Croft
Helen’s focus is contentious and non-contentious employment law for both employers and employees. Her work includes advising employers (both small and large organisations) and employees on competition issues, unfair and wrongful dismissal and discrimination law matters.
Helen says that we should recognise the Women on Boards debate is about business performance as much as it is about equality in the workplace. What do you think should be done to help reach the 30% target?
2011 opinions are now closed for further comment.
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I have no doubt that some of the measures suggested by previous commentators would go some way towards helping companies to reap the benefits of increased gender diversity in the boardroom. However, I must admit that they are not radical enough for me. I would suggest that in order to solve this problem we must examine the two most fundamental issues that lie at its root.
The first issue concerns the question of why so many women are unable or unwilling to combine a career with raising a young family. It seems to me that the most obvious answer to this question concerns the provision of childcare. A full time place in my daughters north London nursery costs around £310 per week for a child under two and around £250 for an older child. In central London, prices are often even higher. After paying tax, national insurance, student loan repayments, childcare, travel costs etc, a working mother with two pre-school age children needs to earn around £50,000 per year just to break even. Even women commanding a salary of £80,000 per year will only be left with around £300 per week after meeting these basic costs. Even leaving aside the financial difficulties, there are also practical implications. Nursery opening hours usually mean that women find themselves unable to make it in to the office much before 9am and must leave promptly by 5pm. This has the effect of making them appear less dedicated and less productive than many of their male counterparts who can arrive early and/or stay late. For most two parent families, it simply makes more economic and practical sense to have one parent remain at home whilst the children are small, enabling the other to devote themselves fully to their career.
On the face of it, flexible working practices might seem to provide a solution to this problem. Is working from home the answer? Any parent will tell you how incredibly difficult it is to get any real work done when you have young children demanding your constant attention. In reality, many parents, having already put in a full days work looking after the kids, find themselves sitting in front of their laptops only after the children are in bed, and often working late into the night. Such working practices are stressful, tiring, unhealthy and unlikely to lead to happy productive employees that are raring for the next challenge.
So my first claim, is that provision of flexible, quality childcare which is free, or at least affordable, is crucial if we are to address the issue of gender inequality in the workplace. This is not to say that companies should bear the cost of this directly. It is in the interests of the whole of society that parents are supported, that children are well cared for and that businesses should flourish, therefore such an initiative should be paid for through taxation.
The second point I wish to make is that businesses need to recognise that men are parents too. We cannot hope to have gender equality in the workplace unless we can first have gender equality in the home. The recent changes to paternity leave may be an improvement on the previous situation, but I do not think they go far enough. For example, why do fathers have to wait until their child is six months old before they can access this leave? Leaving this aside, I would question why couples seem to feel the need to designate one parent as the primary carer at all. Instead couples should be enabled to take equal responsibility in their parenting roles. To do this the emphasis needs to be placed on taking measures that actively encourage men to get more involved with their children. Men should be encouraged to take advantage of part time hours and flexible working practices, safe in the knowledge, that this will not affect their chances of promotion later on down the line. When men are truly able to take on their fair share of responsibility in the domestic sphere, women will be able to take on more responsibility at work. The fact that they will need less concessions from their employers, and the fact that male parents will be receiving equal concessions, removes the disadvantage that women commonly face in the workplace and creates a more even playing field. By doing this we remove the need for targets or quotas, as women simply won’t face the same barriers to promotion that they currently do.
I agree with Lord Davies in the sense that diversity in a boardroom means “different life experiences” because this enables businesses to connect more with different customers. I do not think that the introduction of quotas would necessarily be the most effective way of achieving Lord Davies’ target; however countries like Norway have shown that the pressure of such sanctions has achieved an increase in female presence in the boardroom. I think that businesses must experience a similar type of pressure if they are really intent on achieving this target and this means, as Helen Croft also suggests, placing a greater emphasis on retaining women after their maternity leave, rather than attracting them in the first place.
One possible means of achieving this would be to give women the opportunity to work with senior executive members, as a kind of mentoring scheme, a concept suggested by other contributors. But what I would stress is that such a scheme should be launched before their leave, as an advanced solution to the problem of female retention. If initiatives were introduced allowing women to work with higher members of the boardroom BEFORE they take maternity leave, they are more inclined to return after their leave to pursue this career goal. A programme like this, called “Female Future” was set-up in 2002 by The Confederation of Norwegian Business and Industry. Volunteer companies selected up to three women to take advantage of boardroom training and networking and this resulted in the successful increase of female boardroom presence. The establishment of such mentoring and training schemes would be an effective way for us to meet Lord Abersoch’s target because by planting the career seed before women take their leave, boards need not worry about re-attracting women; they will be motivated to return themselves in order to develop and aspire further up the career ladder.
Another advanced solution and means of ensuring we achieve Lord Abersoch’s target would be to improve the communication process between employee and manager. Before taking their leave line managers should arrange several meetings with the individual involved to discuss after leave arrangements, demonstrating their responsibility for the welfare of their female employees and displaying a real effort in female retention. Although I feel like the Additional Paternity Regulations is a good solution, it is not effective enough, because it comes after women have taken their leave. In this way, when they return to work, they will be forced to play catch-up and re-commence the hierarchical ladder, instead of ascending it. If businesses implemented more teaching resources or development courses to ensure women can stay in touch at home with current news and business developments, then this would enable women to practise motherhood and maintain their working roles. Upon their return, they will then have the skills to be able to quickly review the changes implemented in their absence and to focus on current case studies, facilitating the transition and making business progression more feasible.
Furthermore, it is the responsibility of businesses to provide alternative solutions so that women are not compelled to have to make a career sacrifice for motherhood. Helen Croft suggests we should look at more support systems and I completely agree. It would be useful to consider the positive impact of business childcare or if this is not feasible, providing financial resources and subsidizing the cost of day nurseries. What is important here is the emphasis placed on support, if businesses can demonstrate it is possible to balance motherhood and a career; women will be more inclined to continue up the hierarchy and the percentage of women on boards will increase.
In conclusion, if businesses are truly serious about achieving Lord Abersoch’s targets, I think that they need to place a greater emphasis on long-term solutions and focus on the retention of women after maternity leave. By implementing a mentoring scheme, launching training courses in advance and helping to arrange for childcare, women will be able to progress up the business hierarchy and we will achieve our targets.
It is clear that the deficiency of women in the workplace, especially at senior management level, is a factor which affects the efficiency of businesses. In fact, 14 companies in the FTSE 100 still do not have any women at senior management level, which, given the apparent “equality” in today’s society, is quite frankly unacceptable. Improving the situation is therefore of paramount importance. Helen Croft states that it is not the initial recruitment of women which presents problems for businesses, but rather the retention of these women, especially when they start to have families. Thus reforms are needed which focus primarily on ensuring that women are in a position to return to their careers after maternity leave or after taking a few years out to have a family life, and have the opportunity to subsequently progress up the business hierarchy.
Whilst I do agree that the mentoring scheme, allowing women to climb up the business hierarchy, is both an innovative and useful tool, I believe that more importance should be given to the practical tools available to women to ensure that they remain connected with their career. Moreover, although the recent additional paternity regulations are undoubtedly a positive step in this field, they do not necessarily solve the problem for many women, either because they are single mothers, or have partners with demanding jobs who would be reluctant to fully endorse themselves in this scheme. Over the past few years there have been various technological advances, and in my opinion these should be used to the advantage of both businesses and women in order to allow women to work from home during maternity leave, or even during the early years of their child’s life. Another option which may encourage women to continue with their careers, would be for businesses to have in-house childcare, allowing women to progress with their careers at the same time as having sufficient child support close by.
It is important to create mechanisms allowing women to return to work having taken a few years off as well as putting a system in place for women who have been away for a shorter period of time. Many women feel it is difficult to return to work precisely because they are out of touch with their companies. As a result, it seems prudent to implement various resources, such as catch-up programmes led by members of their company, or experts in the relevant fields, to inform these women of any developments that have occurred since they were last in the workplace. Another variation on this would be to create courses which women can take whilst on leave, perhaps weekly, which would allow them to develop further skills, and therefore increase their business knowledge and acumen whilst they are not working. They would then be able to return to work a few years later, having gained additional skills, making it more feasible for them to climb up the hierarchy system than it is for women at present.
Overall, although we need more equality in the workplace, it is important to recognise, as Helena Kennedy has, that equality does not mean subjecting men and women to the same procedures and standards, but rather moulding situations so they confer the same sort of benefit on both genders. Female owned businesses tend to provide a more family-friendly business environment. As a result, they generally attract more females, who in some instances constitute 60-70% of the workforce, whilst they also have many more women at management and director level. This shows, as noted by Mary Cantando, that it is possible to retain female talent. The lack of sufficient mechanisms in the male-dominated business world, to allow women to return to work, has inevitably given men an advantage. By implementing tools to encourage women to remain in employment and make it more feasible for them to balance their family lives with their career ambitions, we should be able to meet the target set by Lord Abersoch. We need to focus first on retention of women; if this is done, climbing up the business hierarchy will be much easier.
Whilst I agree with many of the suggestions other contributors have made, including the emphasis on retention, change of attitudes and working practices, I feel more focus should be given to the issue of mentoring.
Emphasis needs to be placed on how women navigate to the “marzipan” layer, and from here to the “icing”, (to cite language used by The Economist, taken in part from the Tyson Report) i.e. navigating from senior management to executive level. According to Figure 5 of Lord Davies of Abersoch’s report, a large percentage of women are “lost” before they even reach senior management. In order to counter this, I agree with Helen Croft’s suggestion that mentoring is an effective way of progressing towards the 30% target, which Lord Davies in his report, indicates can be achieved by all boards by 2020. I am of the opinion that more structured and focused mentoring would not only be a feasible, but also practical method of enhancing corporate skills. Moreover, mentoring specifically tailored for women aspiring to the executive level is necessary as a counterbalance to the existing, well established male mentoring systems, and to prepare them for the predominantly male orientated corporate world.
INSEAD professor Herminia Ibarra makes an excellent point in distinguishing between the types of mentoring that women and men are exposed to, in a recent contribution she made to a debate on the issue of women at work in The Economist. Her research suggests that, although more women than men are linked to dedicated mentoring schemes within a company, male workers’ mentors are more likely to have high level jobs, which enable them to create many more career opportunities for their mentees, at times acting as sponsors.
Furthermore, whilst statistics point to more female mentoring schemes within the workplace, in reality, this is upstaged by far greater (and effective) male mentoring outside of the office environment. The old boy network, especially prevalent in London’s financial district and shared interests in leisure time, such as golf or shooting, act as platforms for career progression.
In relation to the above, I would suggest that mentoring schemes for women should include sponsorship and provide career opportunities, so that women can gather the relevant experiences and develop the special skill set needed at the higher level. Furthermore, mentors should be selected for their skills and not their gender. An encouraging example of such a scheme is the FTSE 100 Cross-Company Mentoring Programme set up in 2003 by Peninah Thomson, of executive coaching firm Praesta Partners. Here, the likes of former Sainsbury’s chairman Sir Philip Hampton and another 44 chairmen and chief executives act as mentors, with each recommending a woman in senior management from their company for the scheme, which lasts for a period of one to two years. A significant feature of the scheme is that it recognises that many board appointments are made on the basis of introduction, an aspect that the Cross-Company Mentoring Programme is successful in addressing, helping 59 females land senior appointments by 2011.
Mentoring, therefore, can potentially provide women with the confidence and introductions, bring them to the attention of company directors and equip them with the skills needed to break through to the boardroom, thus accelerating the appointment of women to this level.
I largely agree with Helen and many of the other contributors’ insightful opinions; however, I feel some of the suggestions go beyond Lord Davies’ recommended increase in transparency and accountability, to the detriment of equality. For example, I disagree with Helen’s suggestion that mentoring should be offered to women to allow them to progress through the hierarchical divisions of their businesses unless male workers are also given mentoring to further their careers.
Similarly, I feel that to take action beyond Lord Davies’ recommendations, in the form of imposing mandatory quotas would also have negative consequences. In spring 2011 the European Union’s justice commissioner, Vivian Reding assembled business leaders and told them to promote many more women to top jobs within the year, or she would involve a move to mandatory quotas. The danger is that if hugely talented women are forcibly placed on corporate boards they will lose credibility. The suggestion will be that they failed to get there on their own merit. This will generate huge resentment and actually reinforce negative, out-dated attitudes.
For this reason I find one contributor’s recommendation that when a decision is being made for appointment to the Board of Directors, and the decision is between two or more candidates of equal merit but different genders, that the female candidate should always be chosen, to be frankly shocking. It is also an incredibly sexist thing for another contributor to suggest that the ‘aggressive’ misjudgements of the RBS board to acquire ABN Amro was linked in any way to the dominant male presence on their board.
I think that the best way to improve equality in the boardroom is ultimately to strongly encourage, by any way possible, male workers to take advantage of additional Paternity leave to increase equality and to take the issue of gender out of the question. I also would like to see brilliant high flying women becoming more visible in the media. Increasing awareness is key, public debates and programmes that raise these issues must be forced onto the agenda. The process must be organic if it is to last, however this is not the same as saying we should continue to advocate the glacial progress of reform embarked on so far. It should be incentive enough for business that many studies have shown that lots of women in senior positions are more successful than those with few or none, but so far it has not, which is why Lord Davies’ measured recommendations are so welcome.
It is worth remembering in these debates that we should be promoting equality and fairness in a disinterested fashion, for it is also men’s lives that are adversely affected by the violence of patriarchal ideologies. I and many men hope to have a high flying career, a partner with a high flying career, have children and be able to be take time off work to look after them without committing ‘career suicide’. I don’t really think this discussion should be just about promoting the careers of women, but rather about promoting equality.
By carefully pursing Lord Davies’ recommendations to improve equality, hopefully all-male boards will look increasingly out of date by 2013.
In order to meet the 30% women on boards target set by Lord Abersoch, transparency is essential. It is clear that unacceptable female retention, not recruitment, plagues companies worldwide. Furthermore, before we can expect improved gender diversity in boardrooms, we must expect it in senior management positions. Therefore, we must make the pipeline from entry to boardroom more navigable for women.
The ability to retain women through middle management years will directly depend on a company’s ability to create a work environment that allows for the coexistence of career and family responsibilities. Transparency should exist from the bottom up, meaning evidence of access to equal development opportunities such as mentoring and sponsorship as well as flexible work schemes must become necessary in order to competitively recruit new employees. Additionally, however, transparency must also occur from the top down, meaning promotion criteria must be explicit and accessible. Promotion cannot, in any way, be based on “face time”. Unfortunately, while flexible work schemes and work from home schemes are extremely beneficial in allowing career and family to coexist, the subsequent decline in “face time” tends to reduce promotion prospects. In Lord Abersoch’s report, he mentioned that women who left the workforce often perceived difficulties in climbing the corporate ladder. I don’t believe such perceptions could or would exist in a completely transparent work environment.
Additionally, I would be curious to see, over time, the number of men who claim their rights under the Additional Paternity Leave Regulations 2010. I am convinced that both company and government initiatives for women on their own treat the symptoms yet do not manage to provide a cure. Societal attitudes towards maternity and paternity leave need to change so that, when possible, taking leave need not be primarily the woman’s responsibility.
Lastly, I must conclude by saying that it is the corporate world that should pave the way in changing attitudes towards family commitments. The fact that some women may not generate as much “face-time” as men should not hinder their opportunities for promotion. The flexible work schemes and mentoring are essential for women with children and accessibility to and acceptance of such programs should be maximized. If we are ever to see gender equality in the boardroom, we must not penalise women for fulfilling family responsibilities.
Lord Davies’ report states that at the current rate of change it will take over 70 years to achieve gender-balanced boardrooms. I think that an absolute balance will never be achieved: all women who choose to start a family must take at least some time off work, putting them at a disadvantage. However this does not preclude a meaningful attempt to improve the situation; the evidence is clear that women improve business performance, bringing different skills and perspectives.
Quotas are not the solution. Invariably those who make the most valuable contribution to a company are the most talented and dedicated, regardless of gender. Moreover positive discrimination may have a negative effect on relations between colleagues if hard-working men feel that their female counterparts are progressing in an unfair way – such negativity cannot be conducive to a successful board. (I advise against the setting of targets in the same way and suggest that they are simply a ‘soft’ version of quotas, producing the same effect.)
While flexible working hours and similar adaptions to the way mothers can work are helpful, their impact is limited – seniority demands commitment, and this includes a time commitment. Similarly recent advances in the extension of paternity leave are unlikely to have much effect, as only one in five fathers even takes their statutory paid paternity leave. Companies could improve the situation by placing the emphasis on potential rather than experience and being willing to appoint women in mid-ranking jobs directly to boards.
Requiring companies to publish statistics on the gender of board members may have the positive effect of shaming companies into action. Conversely it may discourage aspirational women from applying to companies where they feel that opportunities for advancement are limited or from applying for particular promotions; however I think there are ways to address this problem.
Firstly, we need a change in attitude. The fact that women account for almost half of graduate recruitment suggests that companies are not inherently biased; rather women are less likely to put themselves forward for promotion. Companies should actively encourage women to apply for high-level positions and urge women on boards to be more vocal about their achievements, acting as role models for the board members of the future. Limiting the number of board positions a person can hold would further progress, creating more vacancies to which women can be appointed and ensuring that companies are not merely ‘window-dressing’.
Secondly, there must be standardised methods of recruitment and an end to the ‘tap on the shoulder’ culture. Vacancies should be advertised to all eligible candidates in the same manner, so that women have the same opportunities. Companies should make their selection criteria very clear so women have confidence that they do have the skills required, and also so that appointments can be effectively reviewed if there is any suspicion of an unfair advantage. As well as increasing the number of women on boards, this would ensure that in every case the best candidate gets the job.
I agree with Helen Croft’s view that the aspiration to achieve greater equality on company Boards is about both business performance and equality. Lord Abersoch’s report, ‘Women on Boards,’ identifies that companies with a higher proportion of women on their boards outperform their rivals with a 42% higher return in sales, 66% higher return in invested capital and 53% higher return on equity. In my view, this issue is so important because women have different perspectives, skills and life experiences to offer, thereby allowing the Board as a whole to consider issues, and make decisions, in a well-rounded and holistic manner.
Since publication of the report, a number of FTSE companies have responded positively. Among them, BSkyB and Vodafone have set targets of a minimum of 25% female representation on their Boards of Directors by 2015. Furthermore, Unilever have implemented a mentoring scheme to support women. The government’s response to this problem – The Additional Paternity Leave Regulations 2010 – is to be welcomed as it allows women to return to work after maternity leave earlier than they would otherwise have done, as their partner is entitled to a longer period of leave. What other measures can be implemented to achieve Lord Abersoch’s goal?
It is absolutely vital for companies to recognise that women have to feel confident that they can take time out of their job to fulfil family commitments, and that this will not jeopardise their careers. An easy way to ensure this is through greater channels of communication: management should find out what senior female employees want. Does she want to work from home on one day per week, or when their children are ill? If this is the case, companies should aim to comply with the employee’s wishes. Further, if a company has a flexible working policy in place, they should ensure that female employees are making full use of it.
It is also advisable for companies to identify their most talented female members of staff and provide them with adequate training and support, so that they feel that confident that they are candidates for prestigious roles within the company.
I would not go as far as asserting that companies should use quotas to achieve higher female representation on their Boards of Directors. I believe that appointments should be solely on merit. However, I would suggest that when a decision is being made for appointment to the Board of Directors, and the decision is between 2 or more candidates of equal merit but different genders, the female candidate should always be chosen.
It may be appropriate, in light of the fact that only one third of FTSE 100 companies set targets for action in response to the Women on Boards report, to view Lord Abersoch’s target as an ambitious aspiration to catalyse change, rather than an impending and inflexible deadline.
Despite this, it is clear that certain companies are acknowledging, and indeed reacting to, the notion that more women are needed in senior positions. Analysis by The Association of British Insurers suggests that Britain’s biggest companies have more than doubled the number of women they are appointing to boardroom jobs since the publication of Lord Abersoch’s report.
A review of the recent history of RBS illustrates this perfectly. In 2007, with the credit-crunch mere months away, an 18-stong board of directors aggressively pursued and secured the astoundingly overpriced acquisition of ABN Amro, culminating in a loss of £4 billion. Only one of the board members was female.
A mere four years later it is clear that RBS have reconsidered the benefits and credibility of an unvaried and male dominated boardroom. In the last 24 months, four women have been appointed to the board, who now make up 25% of an entirely transformed senior structure. The acknowledgment of these facts combined with the “Board Diversity Statement” on the RBS website unequivocally indicates that Lord Abersoch’s proposal is helping to stimulate a change that, as Helen suggests, was not only needed for women, but undisputedly essential to business recovery and future development.
With this in mind, it is conceivable to anticipate that Lord Abersoch’s target will be met simply through natural change stimulated by the economic crisis, combined with pressure from government attention and most importantly, the media, as companies will inevitably respond when the priceless commodity of reputation is at stake. It is of no surprise that few supported the arguments of Simon Murray, chairman of Glencore, after he proclaimed that it is a risk to hire young women.
Additionally, although some, such as Vince Cable may see such aforementioned “primitive views” as a clear signal that “tough action” is needed, I believe that this cannot come in the form of quotas. A natural and rational rise to the 30% figure is essential in order for the system of women rising to the uppermost levels to become self-perpetuating.
Of course, businesses also have a responsibility to help women “break the glass ceiling” from within, as well as relying on headhunting companies such as Sapphire to help them find a finished product (for example Alison Davis of RBS). Businesses must develop flexible working practices, for instance working from home and creating part-time senior roles, so that a woman can embrace having a career and a family, rather than choose between them. Moreover, it is a company’s prerogative to ensure that their employees are aware of additional paternity regulations, in order that women can return to work swiftly after childbirth, without slipping down what is already an unsteady corporate ladder.
I would agree with Helen Croft that implementing policies such flexible work arrangements and mentoring are important first steps to tackling gender inequalities at senior levels. Furthermore, giving talented women senior sponsors is another policy which could help to increase the exposure of talented females to senior management, which is likely to precipitate in real career benefits.
Moreover, I also believe that for these policies to be put into practice effectively, managers need to be aware of the business case for gender diversity at the senior levels. The first point to make is that by having female representation at the senior management levels, decision making will be reflective of the diverse client base of many organisations. For example, Deutsche Bank have published research which illustrates how over 80% of consumer purchases in the developed world is made by women. Therefore, it is extremely important for firms which produce consumer products aimed at women to have female representation at leadership levels.
Furthermore, gender diversity has been proven to lead to financial success. A 2007 McKinsey report demonstrated how companies with the highest gender diversity at top management levels also had a 10% increase on return on equity, and a 170% stock price growth, in comparison to their less diverse counterparts.
Gender diversity, particularly at senior levels where business decisions are made, needs to be seen as more than a “women’s issue”. Rather, it is a business issue. By harnessing the talent of women, firms can benefit from a wider pool of talent to drive business success.
The comparatively low number of women in leading positions in businesses is an issue I feel strongly about. I welcome the trend visible across European societies towards increasing the representation of women in business. Lord Abersoch’s proposal is only one example of the recognition that it is not only in the interest of women, but also in the interest of future business development to have more women in influential positions. Encouraging the creation of more diverse boards would arguably lead to a more balanced and multi-faceted approach to business management and strategy. Particularly in light of the current difficult economic climate and the aging European populations, finding ways to achieve this should be a key priority for business and public policy.
I agree with Helen that the Woman on Boards debate should be as much about business performance as about equality in the workplace. While Lord Abersoch’s proposed target is sensible, it must not result in positive discrimination in business appointments. As the statistics show, there are many women qualified and capable of acting in leading business roles. The current imbalance between female and male employees in leading positions is due to underlying structural deficits and social attitudes, rather than a shortage of competent women.
So what can be done in order to improve diversity in business leadership positions? Arguably one of the key reasons why women are underrepresented in leading positions of most professions continues to be the difficulty of managing a career and family life. While many women aspire to have both, social attitudes and work requirements are often such that family and career success prove incompatible. Businesses increasingly recognise that flexible work schemes are essential for addressing existing imbalances in top positions. The benefits of flexible work schemes – allowing women to work less while having young children – are widely known. However, they can result in women losing touch with business developments and for this reason should be combined with alternative approaches. In the age of instant communication, which makes work location increasingly flexible, working from home is a model that I believe should be pursued further in order to enable women to work while raising children. This approach should be used more widely to enable employees to balance career and family commitments.
However, such changes will only be effective if they are accompanied by changes in social attitude and existing infrastructure. Increasing the availability of flexible working will result in increasing the number of women in top positions only if complemented with improvements to existing child care facilities and increasing the social recognition of roles men play in the upbringing of their children.
Yet one should not be too pessimistic. A greater number of men taking paternity leave indicates that such social change is happening. A more equal representation of men and women in top positions is only a question of time, provided that the suggested policies are followed in a consistent and practical manner.
A realistic approach to an utopian idea – the woman who can have it all
Lord Abersoch’s aspirational goal of 30% women on the boards of FTSE companies is a laudable attempt at supporting a fundamental re-evaluation of the traditionally ruptured career route for women. As Helen rightly points out, attracting women to start careers is not the issue; rather it is retaining them and thus enabling women to continue contributing to business performance throughout their careers.
There are a number of different ways to start approaching Lord Abersoch’s target quota. Firstly, a greater emphasis must be placed on sourcing talent from within organisations; secondly, changing traditional workplace approaches to supporting families; and finally, government should ensure support for companies aiming to implement measures to meet the target. I will address each of these in turn.
1. In 2010, I attended a debate at the European Parliament Committee on Legal Affairs (JURI) on the Report on Women and Business Leadership. The most frequently voiced counterargument to a quota on company boards was that promotion should be on merit not on the satisfaction of a quota. However, this argument leads to two troubling conclusions. It firstly implies that there are not enough talented female employees in companies, who are worth nurturing. The argument also ignores evidence on the impact of women on business performance – a February 2011 study by the Amsterdam College of Applied Sciences suggests that an equal divide in management teams leads to far more successful business outcomes. Hence, it is necessary to rebut this assumption that management needs to magically conjure 30% of women in order to succeed and instead promote the idea of supporting women in companies from the start. This will allow them to become eligible senior management candidates due to their performance, rather than as a result of a quota.
2. Secondly, enabling female and male employees to have a family life without sacrificing their careers is fundamental for the increase of employee happiness and productivity. This may not mean less work or shorter working hours, but could be in form of flexible working times for parents with younger children, such as the ability to work from home when necessary.
3. Finally, government has a duty to support such a proposal. Businesses alone cannot be expected to implement measures without government backing, both politically and financially. Hence, government should consider reward schemes or financial support for companies allowing women to fulfil their ambition to work whilst having a family. A first step into the right direction would be the option for extended paternity leave or more daytime childcare support for parents.
The debate around the 30% target in itself is already a step in the right direction as it shows that there is an appreciation of women’s contribution to business and an appetite to solve the problem of reconciling the two most important areas of lives for women who want children and a career. Hence, it is crucial we continue to aspire to Lord Abersoch’s target.
Women constitute 60% of the trainee intake in the City’s legal elite, yet only 18% of the partners in these firms are female, according to a study by Legal Week. The under-representation of women at the top is not constrained to the legal field; only 12% of directors of the FTSE 100 companies are women, and almost half of the FTSE 250 businesses do not have a single female Board member. It’s clear that women are not reaching the top of the corporate ladder, but why? And are quotas, as suggested by Lord Abersoch, the right answer?
In order for women to have greater presence in the boardroom, government intervention, such as quotas, is imperative. Quotas provide a catalyst for change, much faster than natural evolution alone ever could. As Elin Hurvenes, founder of the Professional Board Forum, a Norwegian government organization, has stated “if organic growth is 3 percent every 10 years, (as it was in Norway before legislation was introduced) it would have taken 100 years to get to 40 percent.” There are, of course, critics that fiercely oppose the potential quotas, citing the ‘tokenism or talent’ argument, but in reality quotas help to propel skilled women to positions that are currently inaccessible to them because of their gender. Any legislation should ensure that women have a way of working up the management tiers to ensure that they have the right depth of experience for the job. There is a danger of ‘trophy directors’ being recruited, mere figureheads taking on multiple boardroom jobs in order to help companies fulfill the quota. Limiting the number of boards a woman can sit on could negate this potential problem, ensuring that each appointment is considered and appropriate.
As Helen highlights, government intervention alone is not sufficient, and companies need to initiate policies to combat inequality. Traditionally, companies have not offered a viable range of working arrangements to encourage young women to stay at work after starting a family, yet the trend does seem to be changing. Allen & Overy have recently introduced measures to enable all its lawyers to work a four-day week for up to eight years. However, it is not enough for policies like this to simply be put in place; women need to be encouraged to take advantage of them, and be reassured that they are not committing ‘career suicide’ by doing so. Women should not be considered less reliable or loyal to the company because they have a family.
In order to meet the target of 30% women on boards by 2013 a multipronged approach needs to be adopted. Quotas generate discussion and debate, and while they tackle the effects of the gender imbalance on boards, they don’t go to the root of the problem. Company policies and attitudes need to change to make it socially acceptable for women to have the choice to balance a highflying career with a family. Legislation alone cannot tackle underlying cultural beliefs; this change must come from the grass roots.