Difficulties for Women on the Rise

| April 29, 2009

Recent studies from around the world paint a clear picture: developing women in business is worth the effort.   

Being interviewed for the The McKinsey Report, one female CEO reflected that thirty years ago she never would have imagined women’s development in business would have progressed so slowly.

Although the first phase of the battle has been won on the twin fronts of equality in educational opportunities and workforce participation, the barriers to women’s career development have persisted.

Three recent reports from: McKinsey & Co UK, The European Diversity Commission & The Institute for Employment Studies  may shed some light on why this is so.

In Australia, women now experience equal or greater representation in the fields of law, economics and business. However, at the senior executive level this figure falls to an average of 10.7%, dwindling further to only 2% of those sitting in the CEO’s chair.

We begin our careers with a promising gender balance of roughly 50:50, only to face a 2:98 gender imbalance at the end. In Australia only 54% of companies have at least 1 female executive manager, (compared with 60% in the UK and 85% in the USA).

Internationally, the key factors preventing women rising to the top of their professions are extremely similar. Four common barriers are; male dominated workplaces, childcare issues, managing family commitments, and a lack of suitable development opportunities. 

Through neglecting women’s development Australia is cultivating the skills shortage. By only selecting from 50% of the talent pool Australian companies are diluting the quality of their senior management teams. It’s such a shame our typical response is to import foreign senior executives at a premium price, when there are so many eligible female candidates languishing in junior positions.   

Why do we continue to make huge investments in a world class education system, producing a plethora of highly qualified female graduates, only to underutilise them in our workforce?   

Companies with a higher proportion of women in their top management have better financial performance. This is evidenced through 36% higher stock price growth, 10% higher return on growth equity and nearly double the EBIT growth compared to the industry average. 

The McKinsey Report also detailed hugely improved performances for companies with higher levels of female executives. In these companies corporate brand image was 69% stronger, employee motivation 58% higher and customer satisfaction 57% better.   

When you combine the financial data with the human capital data what emerges is a very strong argument for developing women in business.

None of this is news. It was 1998 when the first McKinsey report was released stating companies with more women in senior roles performed better, so why has change been so slow? 

The piece of the puzzle I find most disturbing is that 54% of senior female middle managers were childless, compared to only 29% of their male counterparts. The Harvard Business School Review confirms that the higher women climb professionally the fewer children they have, but the reverse is true for men

This is a sensitive topic to discuss, because interpreted superficially it may seem to reinforce the old stereotype that women need to make a choice between career and family; an ultimatum society does not push upon men.

Look a bit closer though, and all it really indicates is that women need to take greater control of managing their business development so that they can fulfil their potential both professionally and personally.

More on how we might support each other to achieve this in my next blog.

Yu Dan Shi is the founder of SucessWe International specialising in executive & career coaching, leadership development, building high-performance teams, professional development for women, and managing diversity & culture. Before founding SuccessWe, Yu Dan had a successful 15-year corporate career in both Australia and Asia. She held senior executive and management positions within several leading IT companies. She was the Head of a business unit for Asia Pacific and Japan at Dell, Marketing Director for Harris Technology, and Chief Marketing Officer for Lenovo Computers in Australia & New Zealand. Yu Dan has an MBA degree and trained as a coach with the Institute of Executive Coaching. Yu Dan is also NSW Chairperson for Australia Computer Association Women’s Board. She lives in Sydney and is the mother of 2 school aged children.

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