Women’s Day – But Not In Business

by .
Originally published in Impact Investor

Here’s a disturbing fact. The number of women in senior management positions in Germany’s leading 100 companies is dropping. A bit embarrassing, given that next Sunday is International Women’s Day.

Earlier this year DIW Berlin, one of Germany’s leading economic research institutes, published the results of its annual ‘Woman Executive Barometer’. This calculates how many women are on the boards of Germany’s major companies. In 2014 the percentage of women on the boards of the country’s top 100 companies dropped from just under 5% to just over 4%. Not much of a shift maybe – but certainly headed in the wrong direction.

According to Dr. Elke Holst, Research Director Gender Studies at DIW Berlin, the boards of Germany’s top companies “remain male-dominated monocultures, despite the obligation toward increasing the representation of women in senior management undertaken by the leading associations of the German business community in 2001. This is anything but a positive development.”

Mind you, we can’t afford to be smug about the UK’s corporate gender diversity. The boards of the UK’s FTSE 100 companies are totally unbalanced – 87.5% of board members are men, 12.5% women. At the current rate of change it will be almost the end of the current century before we will see gender-balanced FTSE 100 boardrooms.

How should we describe this state of affairs? Unfortunate? Outrageous? Bizarre? I’d settle for wrong. If pushed further, I would add that it’s disastrous for the wellbeing of our society and its workers to have such unbalanced corporate life. As father to three daughters, I would really love to see this kind of stubborn inequity disappear. For a start we might substitute ‘inequity’ – meaning lack of justice – for the rather woollier word ‘inequality’…

I could offer lots of reasons why this gender imbalance exists in corporate life, but it’s the same reason why there are many fewer women in prison than men. Women are – on the whole – just nicer than men. They tend to nurture and care; men tend to prance and fight.[i]

Too many disagreeable people

The stats are pellucid. According to the Harvard Business Review (HBR) women make up 60% of university graduates in Europe and the US, 50% of the workforce in the US, but only 2% of the top jobs in America, and 5% in Europe. Part of the reason, maybe, why women don’t make it to the top is because of the pram in the hallway, as the writer Cyril Connolly, a contemporary of George Orwell’s, put it. And being a nasty piece of work is definitely correlated with higher wages. A different HBR survey, stretching back as far as 1957, found that “disagreeable people consistently earned more than agreeable people”. This was true of both men and women and across all job sectors. The survey commented: “…over time both men and women paid a further wage penalty if they mellowed and became more likable, with those moving from sort-of to really nice paying a higher price than complete jerks who mellowed into mere slime balls.”

Men leave behind the fallers

But what we are talking about here is probably obvious to most women and also a good few men, if, that is, they eschew the macho culture they get sucked into shortly after birth. I asked a work associate of mine to imagine what the world might be like if more women in charge of companies. Rather than point towards the endless heaps of slowly mouldering surveys, questionnaires, or similar paperwork that gets endlessly recycled but never seems to change anything, she gave me a highly illustrative anecdote, from the top of a European ski slope: “The group I’m skiing with usually do a men’s trip & a women’s trip because they all have kids in school. The men follow a pretty clear leader, go fast, take the piss out of anyone who falls and leave anyone that doesn’t keep up. The women discuss a route at breakfast & agree as a group, always ski together, help anyone stressed and never leave anyone behind.”

Naturally there are always exceptions, women who stand out precisely because they have made it to the top of the greasy pole. Women like Haruno Yoshida, recently appointed as the first female head of the Japanese business association, the Keidanren. Yoshida raised her daughter as a single parent, and admits that it took two decades (her daughter is now 20) to become reconciled with her guilt at not spending enough time with her daughter. Women sacrifice their personal lives if they want to crawl to the top; men sacrifice their female partner’s professional life.

Yin and yang

There is some hope however. CEO of Sodexo, the global services company, is Michel Landel. He has just given an interview to McKinsey, where he identified something rather critical when it comes to a better gender balance: “Last year, we set out to explore the correlation between gender-balanced management teams and key performance indicators such as employee engagement, brand awareness, client retention, and financial metrics. We analysed data from 50,000 managers across 90 entities around the world and the results are compelling. They clearly show that teams with a male–female ratio between 40% and 60% produce results that are more sustained and predictable than those of unbalanced teams.” In other words: gender balance = better performance. Who’d have guessed it? The yin and yang of business success…

It’s a view echoed by Nadia Sood, a founding partner of Impact Investment Partners, which invests directly into companies that drive positive social change and commercial returns. Nadia has an experience of business and finance, including senior roles with Nestlé, and private equity ventures in Africa and Asia. She says that “for me, the debate about women on boards is the wrong debate. Boards often don’t get into very detailed aspects of the business. What’s important is to get more gender diversity right through the ranks.”

So don’t let’s get too fixated on the ‘how many women on boards’ question – what’s even more important is getting the 50-50 balance from top to bottom in all spheres of life, corporate and otherwise. Happy International Women’s Day!

[i] Yes I know there is a profound irony in this being written by a member of the prancing fighter brigade. I can only apologise for that. I equally plead guilty to having had, in my time, several female bosses – some good and some bad. That kind of equal distribution is how matters should be of course.

This article originally appeared in Impact Investor

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