S M L Reset to Default

Unleashing the potential

More female leadership is good for business, shareholders, and society. But are companies getting the message?

by Julie Sobowale

Anna Stuart knows how to find talent. For more than 20 years, Stuart has helped companies optimize performance. She ran the management-consulting division of the Halifax office of accounting giant Grant Thornton for six years before heading to Halifax-based recruiting firm Knightsbridge Robertson Surrette. One of the most pressing HR issues facing businesses today, insists Stuart, is female management. “It’s no longer about finding female applicants,” she says. “It’s about how to retain women. Women and men have different perspectives about their careers. Companies have to change.”

Women are a largely untapped resource. Although they comprise nearly half the Canadian workforce, few are in senior-management positions. But some progress is being made, particularly here on the East Coast. Only 6% of the Financial Post’s Top 500 companies are run by women, compared to 11% of the Progress TOP 101 companies. According to the Atlantic Provinces Economic Council’s recent labour force report, A Rising Tide, 39%of the region’s managers overall are female compared to 37%nationally. In the private sector, APEC estimates that only 18% of the region’s senior positions are filled by women, a 5%increase since 1996.
 
Still, most female managers work in sectors heavily concentrated with female workers.Catalyst, a New York City-based non-profit research organization that focuses on women in the workplace, reports that the food services, retail, and finance sectors have more than 20% female senior managers. Fewer than 15% of managers in construction, manufacturing, and mining are women, and those industries have few females in the workplace overall.
 
Perhaps the most crucial overhaul is needed in the boardroom. Only 13% of corporate and advisory boards in Canada include women. A comparable rate applies to Atlantic Canadian companies: only 13% of TOP 101 Companies in Atlantic Canada have women on their boards.
 
Catalyst studied the financial benefits of women on boards in 2007. Its report, Bottom Line: Corporate Performance and Women’s Representation on Boards, linked financial success to the presence of women directors. Companies with the most female board members outperformed those with few or no female directors in return on invested capital by 66%, return on equity by 53%, and return on sales by 42%.
 
Boards also benefit from the presence of women in terms of demanding ethical standards. According to the Conference Board of Canada’s 2002 study, Women on Boards: Not Just the Right Thing…But the Bright Thing, women make boards more efficient and critical. Of boards with three or more women members, 94% created conflict-of-interest guidelines, compared to 68% of all-male boards. And 86% of boards with three or more women created codes of conduct for their organizations, compared to 66%for all-male boards.
 
If companies can be more profitable and ethical, why are there still so few women on corporate boards? According to Catalyst, the answer lies in the way directors are recruited. Companies choose from a narrow pool of applicants, usually CEOs from public companies. Since there are few female corporate CEOs, women are excluded. Deborah Gillis, Catalyst’s vice-president for NorthAmerica, recommends that companies look at marketing executives, HR specialists, lawyers, and accountants when searching for board members. “Search for a set of experiences that are not limited to a CEO title,” she says. “Define what you’re looking for.”
 
Companies unable to find female directors can add advisory boards with representatives
from diverse backgrounds, and so keep the original board intact while getting the advantage of diverse ideas. Companies could also develop a quota system; several Crown corporations and government agencies have policies that require a certain number of women on boards. Regardless of the strategy used, companies will need a formal process that results in considering a wider range of applicants.
 
A commitment to promoting qualified women includes watching out for employees’ positions over the long term. In 2004 Ernst & Young, Goldman Sachs, and Lehman Brothers formed a task force called The Hidden Brain Drain: Women and Minorities as Unrealized Assets, to investigate long-term leave. It discovered that 40% of women and 12% of men leave the workforce at some point during their careers to raise children or take care of elderly parents. When women leave, they often go for only a short time; the average is two years. Fully 93% of women who take a leave want to return to their jobs, for both career fulfillment and financial reasons.
 
Companies can keep staff members engaged while on leave. For example, buddy systems allow employees to stay in touch with the organization. Employers should also provide a long-term plan for the worker’s return. For small businesses, the difficulty lies in  replacing the employee during leave. Anna Stuart suggests that employers find creative ways to keep the position intact. “Instead of having the position part-time, have two employees split the position,” she says. “That way you address the gap and also give employees a chance to learn new skills.”
 
Deborah Gillis believes executives need to take three key steps toward developing female leadership: communicate to management how female leadership is good business policy; hold management accountable for creating career-development programs; and ensure equal distribution of employment opportunities. “Cultural change needs the support of leadership,” she says. “There will be resistance. Management has to communicate consistently about the business rationale to be successful.”
 
New strategies are needed in order for companies to attract top talent. Companies can develop diverse groups of candidates for senior-management positions by creating diverse hiring committees. They can also even out opportunities for career development with formal mentoring programs and networking events. Mentors can help employees understand the rules of the organization and stay connected to industry leaders.
 
“Young women need to see positive role models at work,” says Gillis. “They need champions to recommend them for positions, introduce them to industry leaders, and give them critical feedback. We need to create career paths for women.”

 

Subscribe to the Articles feed

advertisement