Gender quality is a pertinent issue for the world of business. Currently, although 46.8% of professionals in the US are women, women only make up between 26% and 43% of the workforces at leading technology companies. That’s set against a gender pay gap estimated to be around 18%. The World Economic Forum predicts that it will take 202 years to achieve economic equality between men and women. That means that, at the current rate of progress, we’ll reach parity in the year 2220. For forward-thinking businesses, this is simply too far away. Today’s organizations must tackle archaic perspectives on female employees and unlock the full potential of women in the workplace now.
Some change is underfoot. According to new research, the number of women-led businesses has seen a surge of nearly 3000% since 1972, and women start 1,800 businesses every day in the US. However, there’s still significant work to be done when it comes to representation and diversity. For every 100 men promoted to management positions, just 79 women reach that milestone. In addition, an average of 16% of global startups have a female founder, and less than 1% of those founders are women of color. Implementing profound change when it comes to women in business not just vital for society itself, but it comes with proven business returns too. Indeed, it has been found that companies with women in management outperform the market in general, with an average annualized return among women-led businesses doubling what the MSCI World Index delivered between 2007 and 2017. It’s time for businesses to address the state of equality and move towards a more equal workforce future.
True organizational transformation comes from a shared understanding of the issue, and measurable steps to change. These steps can be broken down into three actionable pillars:
- Workplace culture
- Salary equity
- Leadership opportunities
In our examination of the state of play for women in business, we’ll take a look at each of these vital pillars. We’ll also delve into how organizations can enact lasting change in these areas to step into a more diverse future of work.
Building a culture for success
Within a competitive and ever-shifting landscape, employee experience matters more than ever. Millennials cite workplace culture as a principal driver for choosing an employer, and businesses that invest in generating an empowering and positive culture will see the returns. Employees that feel their voice is heard in their organization are 4.6x more likely to feel empowered to deliver their highest job performance, and satisfied staff are proven to be 20% more productive in their positions. Diversity isn’t simply a question of ticking a box by making new hires, it’s a holistic mindset that involves entire organizations and the way they approach their work. An inclusive organizational culture isn’t only measured by statistics: it’s abou how successfully every individual within it thrives.
Brands should start at a policy level to set expectations for a respectful and inclusive environment. By formalizing their commitment to building a work ecosystem that works for all in a company policy, accountability is introduced, on behalf of the organization itself and all its members. Articulate this policy clearly and familiarise all new hires with this foundational policy of equality.
When businesses introduce technological change, training is a given. Cultural change is no different: make equality a shared vision through training, workshops and education. That way every individual, male or female, feels they hold a stake in the transformation and is equipped with the information to implement it effectively.
Did you know that the average US employee spends 1,770 hours a year at work? Equality isn’t just about numbers, it’s also about the human experience of the people that make up those numbers. Building a work culture that enables diverse teams to realize their true potential is a key element of changing the state of play for women in business.
Closing the gender pay gap
The gap between men and women’s pay in the US is currently 20%, meaning that women earn, on average, $9,909 less than their male counterparts a year. Organizations can design a positive work culture, hire more women and transform their approach to communication in professional spaces, but all this means nothing if it’s not accompanied by salary parity. To put this in context, if the pay gap were closed the average female professional could afford one more year of university tuition, the equivalent of 14 months of childcare or 74 more weeks of groceries. However, pay equality isn’t just good for women, it’s good for the economy too. Recent studies have demonstrated that pay parity would generate an extra $512.6 billion in annual income for the US economy.
Organizations can begin by leveraging a wage gap calculator to simulate scenarios to close the gap between women and men and optimize economic opportunity. Another vital starting point is to make wage and salary information public and accessible, a feat managed by over 70% of public companies but just 17% of private companies today. When it comes to transparency over pay, private companies trail far behind, demonstrating the low priority attributed to wage transparency in today’s climate.
An actionable step to improving the economic opportunities for the genders is to examine the diversity not just of an organization internally, but of its suppliers too. Consider increasing reliance on female and minority-owned suppliers, which are historically underleveraged by corporations. It’s been proven that matching consumer base to a brand’s supplier base brings positive results. Thus, if your key consumer profile is young working women, but your product is created and supplied by a male-owned and operated team, you might want to rethink. Women controlled around $40 trillion in consumer spending in 2018, attributing significant buying power. Why shouldn’t that buying power by reflected on the supply side too? Organizations that redress this balance also stand to gain actionable insights into their consumers too.
Therefore, despite some progress for working women in recent years, they continue to work within the bounds of a biased salary structure. For companies seeking to attract female talent and build genuinely diverse workforces, it’s essential to act on this in order to unlock the productivity and empower professionals for years to come.
Opening opportunity pathways for all
A quick glance at management statistics shows that the representation of women reduces steadily as you move up the employment ranks. For white women, workforce share decreases from 31% to 19% from entry-level to C-Suite, whilst for women of color, the percentage drops from 17% to just 4%. When addressing the issue of female representation in business, companies not only need to hire more diverse individuals, but they need to open opportunities for personal growth and promotion too. Representation matters, not just now but for the future. That’s because when those pathways to the top are opened for women in business, more will follow. Indeed, studies show that the gender of founders postively impacts the gender balance of the employees as a whole.
A proven method of opening advancement opportunities for women and other minorities is via a mentorship program,so that experience can be passed down from one generation to the next cohort of leaders and innovators. Additionally, structural imbalances can be addressed using a sponsorship program, which builds a roadmap for entry-level professionals to reach the uncharted waters of the C-Suite thanks to tangible support and guidance.
Opportunities won’t open themselves: companies need a holistic approach to improving diversity and the investment to back this up. For instance, companies that appoint a dedicated diversity task force typically succeed in increasing female representation by up to 30% within five years. To achieve an authentically diverse workforce at all levels, intelligent goal setting is also crucial: set measurable, achievable and public goals for transforming the way women progress through your organization.
Conclusion: moving towards an equal future
Gender equality is a real challenge that innovative businesses must address. If they fail to do so, they risk compromising their competitivity, employee loyalty and brand image. Today’s companies face increasing pressure to innovate and understand a range of customer profiles. Responding to this need will be impossible without a range of employee perspectives, and an innovative approach to workforce-building too.
By focussing on the three pillars of culture, pay parity and opportunity, the state of play for women in business can be tackled holistically rather than tokenistically. A fairer future is better for customers, employees, and better for business too. How is your organization moving towards a more equal future?
