Women in Leadership: An Intervention for the Imbalance?Published: March 05, 2012 in Knowledge@Australian School of Business
When Jen Dalitz first tackled the issue of gender imbalance in organisations, she had a management consultant's perspective and saw it as a cost-saving opportunity. Replacing women who opted out of corporate roles often cost employers twice their annual salaries. Then Dalitz, an Australian Graduate School of Management MBA alumna, discovered there were major upsides for organisations with women in senior executive roles and on their boards, including greater profitability. Still comparatively few women are on the senior leadership career path and the reasons why are complex, says Dalitz, now in her fifth year of running gender balance consultancy, sphinxx, where she works with the executive teams of many of Australia's largest companies to redress the balance. Not one to hold back, Dalitz also writes the popular SheEO blog (thesheeoblog.com) and received the Edna Ryan Workforce Award for improving the working conditions of Australian women. She was also a finalist in the 2010 Telstra Business Women's Awards.
Policy changes are important to help women into senior leadership roles, Dalitz suggests, but the big challenge for employers is changing "how we do things around here". What's particularly vital, she tells Julian Lorkin of Knowledge@Australian School of Business, is that organisations consciously deliver equal opportunity both to women and men.
An edited transcript of the interview follows.
Knowledge@Australian School of Business: There has been ongoing debate about creating a quota in Australia to increase the number of women on boards. Do we really need a quota?
Jen Dalitz: The quota debate has been running hot for a number of years now, and given the lack of progress of gender balance – particularly the advancement of women on boards and in very senior leadership roles – perhaps a special intervention like a quota would be timely.
In Norway, where they have a quota related to the number of women on boards, the issue is: how do you translate that to women in senior leadership roles? And that hasn't happened as a natural course in Norway. So there's a bit of to and fro on both sides of the argument for quotas.
Knowledge@Australian School of Business: But when quotas are suggested they don't go down particularly well with much of the Australian business community.
Jen Dalitz: True, I guess no one likes interventions, people coming in and saying: "This has to be done." But in Australia women have comprised the majority of university graduates in Commerce, Economics and Law, all those feeder disciplines into leadership roles, for over two decades now. Now there are 1.3 women to every one man in our university system. You'd have to say we're investing a lot of money in educating our women. Lots of women come through the Australian Graduate School of Management's programs … I know when I was studying there were plenty of women. Perhaps quotas are the only way to make some real change in a quick way, which is what Norway's been able to achieve. It (creates) that momentum of change, so maybe then you can pull back and say, "Okay, now that we've got a bit more balance, let's remove some of those interventions and let things flow more naturally."
Knowledge@Australian School of Business: But how do you get away from the argument against affirmative action, which is that it is very good for women, but are you always recruiting the best candidate for the job, which is after all what shareholders would like?
Jen Dalitz: Look, I think shareholders would like a lot of things, including the best possible return on equity and what we know from research from Catalyst (a US not-for-profit member organisation focused on expanding women's opportunities in business) and other organisations around the world which have been studying this issue for a long time is that the bottom line is much stronger – up to 35% higher return on shareholder equity – when there is a diverse representation on the board.
If shareholders want a better return, we do need to see women represented as much as men when it comes to leadership on the boards and in those very senior decision-making and strategic roles in business.
Knowledge@Australian School of Business: You also conduct research in this area, which you present to executive committees, what have you found through your own studies?
Jen Dalitz: The findings are very much that by diversifying your intellectual capital and having a better representation of your community at the table – when you better represent those customers and really understand them – your organisation performs better. I work with executives from some of the very largest companies in Australia and I can see that at the top they actually get this. Some of the CEOs have really been grappling with this for a very long time; how do we get more women coming through the ranks? Not just at entry level, but how do we have them progressing through the ranks and really making it to the top? That's what they want to see.
The challenge now is how we translate that into execution and see some of the real changes in culture and in workplace behaviours in the way we recruit and recognise talent and make sure that everyone is given an equal opportunity. Even if career progression and the way someone has moved through one role to another looks different, [it's important to] make sure those people have the same opportunity to have input at the highest levels in organisations.
Knowledge@Australian School of Business: Is it recruitment and promotion which is holding women back or are there other reasons why women are not progressing up the career ladder?
Jen Dalitz: It was purely out of curiosity that I started looking at this issue of gender balance. When I was still working as a management consultant I was noticing the drop off of women, and I thought there must be some simple way to fix this, because if we could we would save a lot of money in organisations. When you consider the talent that organisations lose when women leave the organisation and don't come back, usually we could estimate that for senior roles it's two times the annual salary it will cost to replace that person.
So I initially came at this thinking that there's a great cost-saving opportunity here. What I now know is that there's great upside potential as well, it's not just about reducing cost. But I also know that it's really, really complex. There's no single silver bullet. However, what we know is it's about policies definitely – flexibility policies, the way we recruit and promote, the way we involve our staff and engage them in the strategy and the execution of strategy. But it's also very much about practices. It's about the way we do things around here, how we support people in our business and the way that we just make the workplace a place that everyone thrives in. And that's everyone, regardless of personal circumstances. And that's the tricky bit really: how do we change the way we do things around here?
Knowledge@Australian School of Business: I have to play devil's advocate and suggest that maybe some men wouldn't like these changes. It will get their backs up if they see people being promoted over someone they thought would be better for the job?
Jen Dalitz: There's always a little bit of defensiveness from those who feel that they'll have change thrust upon them and that it might not work for them. There was a great study by Bain & Company about two years ago that showed middle management was certainly the area where the most resistance came from. So what that says to senior leaders is you need to engage those people early and bring them on the journey and help them to understand that actually what's good for the organisation as a whole will be good for them too.
Knowledge@Australian School of Business: And when you worked in the corporate field you must have seen some discrimination as well?
Jen Dalitz: Sure. Certainly in terms of overt discrimination, the days thankfully are largely gone of unfavourable behaviours in the workplace. But there's still covert discrimination that goes on today … a lot of people refer to this as unconscious bias and the things that unconsciously go on. And they're rooted into the values and experiences that we've all had and that frame of reference that we bring to the workplace. We anchor a lot back to what it looked like for us when we were coming through the ranks and what it looked like for the people around us, too. And it is looking very different now and we have to catch up and keep pace with that. Most corporate businesses were built by men for men who typically went to work when women stayed at home, ran households and raised families. There has been a huge shift in a relatively short space of time and some people are still catching up with that. But thankfully, we have had great protection here in Australia that has seen most of the overt discrimination go anyway.
Knowledge@Australian School of Business: Are some sectors catching up a bit faster than others? There must be some very traditional industries out there.
Jen Dalitz: True, the sectors do vary quite a bit. But you know, again that's part of the challenge and that's a part of educating … from entry level all the way through. Those areas that have been more traditionally male-dominated … engineering, even some of the legal profession. Although women have been the majority of law graduates for two decades now, women hold fewer than 20% of partnerships in law firms in Australia today. And when you look at equity partners it's down around 12%. So you'd have to say, "Well what's going on there when 67% of law graduates now are women?" It is very much about how decision-making is controlled in industries and sectors in organisations, and drilling down specifically to how do we influence those decision-makers.
Knowledge@Australian School of Business: Are there any specific improvements you'd like to see in Australia?
Jen Dalitz: The best thing that's happened in the last few years has been the change in corporate governance reporting requirements for listed companies. The Australian Securities Exchange (ASX) has said that as a best practice it would like to see companies reporting on how they are managing gender balance and gender diversity in their workplaces all the way from the board down. A lot of people think this relates just to board positions but it's actually about the whole organisation and it was introduced in 2010, but it became mandatory for listed companies from January 2011.
It's been running mandatorily for a year now and some companies are doing quite well in regard to their reporting and therefore the programs they're introducing to support gender balance in the workplaces. Not all though.
Some organisations are saying they want more time to do it, some are saying they think it's not relevant to their business. A lot of the mining companies still don't have any women on their boards. And in terms of representation in their workplace, it's not looking much better either. So those initiatives are great. They're driving change, but we're not there yet.
Knowledge@Australian School of Business: You're quite outspoken on your blog, which is your take on gender balance and women in leadership. What's been the reaction to that in the corporate world?
Jen Dalitz: Not everyone likes what I have to say, I do call it as it is on the SheEO Blog. Some would say it's a bit of a career-limiting move but I think it's really important for leaders to understand what is really going on, the real facts as regards to gender balance. Some people still don't even understand that women aren't equally represented and that we've now hit 12% of women on boards in the ASX200 listed companies. If you go beyond that top 200, I can tell you that it drops down significantly, and actually the majority of 200 to 500 companies on the ASX don't have any women on their boards at all, not even one.
We know from the research that if you are a shareholder you'll get a better return if there are women on those boards. So people need to know which companies have women on their boards and which don't.
In terms of the way that organisations are run, it's really important for leaders to understand what are the barriers for women. What are the organisations that are doing it well in terms of attracting, retaining and developing the very best women on their teams? It's helpful as an employer to understand what could be done better to retain the very best talent in the workplace.
And in terms of how women are feeling … A lot of women working in challenging environments are looking for a voice, someone to advocate for them and share some of their experiences. And you know what? Some of those experiences are great and some of them aren't so great. And I think it's timely every now and again just to point out – that though we have come a long way and that things are looking a lot better – that these are the circumstances that some people are working within. So I will report about policies and practices going on in their workplaces that aren't working for them as much as the ones that are working for them.
But I like sharing great stories and you asked about which sectors are doing better than others. Engineering has been one that's struggled quite a lot in the past. But they had a Year of Women in Engineering about four years ago, and as a result women have fired up in that sector. Now we see that the Young Australian of the Year this year is a young woman (engineering and computer science student, Marita Cheng), and that Engineers Australia has a female president. So things are changing even in the most male-dominated industries. And I think that just sharing those stories and playing my little part goes some way to supporting companies and individuals on that journey.
Knowledge@Australian School of Business: You're communicating to companies on improving productivity and performance by increasing diversity. But how do you get the message to a young female graduate that she can succeed in whichever field she chooses?
Jen Dalitz: Graduates aren't the issue, they have very optimistic dreams and many of them go on to achieve that. But the 30 to 40-year-old age bracket for women is the biggest challenge.
In your 20s – your late 20s in particular – is when a lot of career opportunities for high performers get presented. And for a lot of women it comes at an exact time when they've got this crossroads going on in their lives. Do they pursue their careers and have a family? Which path do they take and can they indeed blend them both? Even if it's not a family implication, a lot of the time that's when women start coming up against the fact that their peers are definitely male in the majority. So they become a minority in their 30s in the level that they're at in the organisation. And that's a challenge, because you will be the different one sitting around the table.
It's also an opportunity because being different is good. We're taught that in all of our studies, being different is good … but it is a challenge that a lot of men never have to face because from aged 30 onwards, they will have been and currently are the majority around the table. So it's a challenging time for women, and that's really when I do a lot of work with organisations on programs for their women, mentoring a lot of women and setting up programs within business for women and men to be mentored side by side – to make sure that they get absolutely the best chance of retaining their high-performing men and women during that stage of their career and their lifecycle.
Knowledge@Australian School of Business: So finally Jen if you could improve just one thing what would that be?
Jen Dalitz: The one thing has to be giving men and women the same opportunities in the workplace. If you're running development programs, make sure that half the participants are men, half the participants are women all the way through from entry level to senior management because giving that equal opportunity is the most important thing.
If you have flexible workplace practices, make sure that men are taking them up as well as women. If you are looking at job redesign, make sure you look at roles that are traditionally held by men as well as held by women. So it's really about the balance. This is absolutely not about creating an environment in which all the leadership roles are held by women because that wouldn't work either. But this is about creating balance – gender-balanced leadership, gender balance in business – all the way through from the entry level all the way through to the board. It's got to be conscious and it's all about the checks and balances to make sure it's equal all the way through.
Knowledge@Australian School of Business: It's been great talking to you.
Jen Dalitz: Thanks, and happy International Women's Day!