I wrote an article a couple of weeks ago for HR Magazine, prompted by the recently published CIPD 2018 Review of FTSE100 Executive Pay. Life being as hectic as it is and the consequent need for brevity dictated a short piece. However for those who have the interest to read slightly more, here’s the broader thinking behind my main points – and as you’ll see it’s not just about men changing the way they think!
The CIPD review was an interesting read, and not just because of the pay statistics it revealed. For me it was another reminder of the opportunities that are still being missed to harness female talent at the very top, and not just in FTSE 100 companies.
Very welcome progress has been made and it’s hugely encouraging to see that 30% of all FTSE 100 board positions are now held by women. However this statistic masks that the number of women in ‘Executive’ roles has failed to keep up. There are just 24 female Executive Directors in the FTSE 100, compared with 195 male executives. A much less progressive 11%, with CEOs at 7%. Plus 78 of the FTSE 100 have no female Executive Directors at all. An interesting pattern and one that, if I were more cynical, I might speculate could also reveal attitudes towards the importance attached to the role of Non-Executive Directors in some quarters? The role of the Non-Executive Director should of course be hugely influential, a bastion of governance, independence and strong strategic leadership. They are also of course by definition not around as much. I am not of course disputing the importance of the hugely influential role of Chairman, but then the FTSE100 doesn’t have many of those who are women either!
While my focus in this article is women on boards, the importance of diversity more broadly is also not far from my mind. I was therefore troubled by the very limited amount of data provided to the CIPD for this review in terms of ethnicity, with only 3 of the FTSE 100 companies providing a breakdown of the ethnic diversity of their board. If the lack of information reflects a lack of focus, this would again point to another opportunity being missed by our largest companies.
Call me a dreamer, but with all other things being equal, which ok is a big ask, I can’t see why half of FTSE 100 CEOs couldn’t be women? Given, according the Office for National Statistics, slightly over half of the UK population are women. It is interesting in its own right that this is at odds with the global picture. According to figures from the World Bank in 2015 49.55% of the world's population were women, in real terms meaning there are 66 million more men on the planet than women. This is the highest differential ever recorded since their records began in 1960. At that time the global population gender balance was 50/50. However I will leave it to those more expert in this area than me to hypothesise on the, potentially very uncomfortable, reasons behind that here.
So why, given this gender balance in our population, are there still so few women CEOs and Executives in the UK? There is no reason in terms of gender, that I am aware of, that means the role of a FTSE CEO, or Executive for that matter, require attributes that can only be found in men. Plus the fact we have women successfully doing these jobs already proves it is not that women can’t. So the question is why more aren’t? Women of course have a role to play themselves and need to be prepared to commit to and deliver the huge amounts of determination, skill, experience, confidence, ability and resilience it takes to do one of these jobs. But again these traits are not the sole domain of our male colleagues. So why do we still only have 7 out of 100 FTSE CEOs that are women? Yes, this is up from 6 in 2016 and 5 in 2015, but patience not being one of my virtues, I don’t want to wait until I’m 77 in 2050 to see parity! Please don’t misunderstand, I’m not a fan of quotas. For me personally they can be divisive and counterproductive in terms of truly making sure the best person for the job gets it. That said I don’t believe 93 times out of 100, if we had a level playing field, men are the best possible person for the job. Those FTSE 100 companies with no female Executives may want consider Grant Thornton’s 2015 ‘Women in Business; The value of diversity’ report, which found that companies with diverse executive boards outperform peers run by all-male boards. They concluded that publicly traded companies in the UK with all male Boards are missing out on £49bn of investment returns, and in the US this figure was £373bn. An increasing number of studies show evidence that more women at the top of companies doesn’t just improve decision making, risk management and contributes to greater employee engagement, but also has a net positive effect on the ‘bottom line’.
So what can we do to improve the number of women at the top? Not just in the FTSE 100 but across the business world and beyond? At heart I’m a pragmatist. We have to accept where we’re starting from and some of the practical barriers women can face. It’s no use pretending that being the ones physically producing children will not be a factor, and to my knowledge we aren’t likely to see any major changes to women’s central role in childbirth any time soon. But it shouldn’t be used as an excuse or a barrier, after all men and women benefit equally and women shouldn’t be seen as somehow having lost something in the process. The reality is, like men who become parents, they gain something, and that can provide even greater determination, resourcefulness and resilience, not less. With the right attitudes, support, technology and focus on what really matters in delivering company performance, there is no reason having children should necessarily be the barrier in the future that it has tended to be in the past.
For me removing barriers is key. Getting better at accepting women can have children without tanking their careers is only one. Given the relatively short period of time many women take out to have children, compared to the duration of their career, we can’t use this alone to explain the lack of women at the top. There are clearly other factors at play. Historical, social and cultural ‘norms’ are definitely up there, some conscious, others subconscious or unconscious, and yes women can be as susceptible as men. So it’s important that we acknowledge and address them.
I was asked a question as part of some unconscious bias training a few years ago. The question was this; “If you were on the 20th floor of a burning building and a fire fighter has to fashion a harness from a piece of ordinary rope by a system of knots in order to allow people in the next building to rescue you, would you prefer it if the fire fighter was a man or a woman?” My first thought, given the session I was in and the inferred benefit of physical strength in the scenario presented, was that I was being led, I felt unfairly, towards saying a man. After all it seemed a perfectly rational, logical response. I was then slightly taken aback when they commented the rescuers on the other building were all male so the physical strength of the firefighter tying the knots was not relevant. It was at that point I had a very uncomfortable realisation that my own ‘disloyal’ subconscious had actually also made an assumption that a man would be ‘technically’ more competent, in a pressured high risk situation, at tying the right knots. Nothing to do with logic or physical reality, but a deeply ingrained conditioning that made me assume a man would be better trained, more able, more competent at something that gender really had no relevance to. It was a crushing experience to realise that if even I made these unconscious assumptions, how could I expect others, and men in particular, to resist the power of the same unconscious type of bias?
Shortly after I read an article on Forbes by Birute Regine, an American developmental psychologist, executive coach, speaker and author which further emphasised the point. Referencing a number of studies and examples she outlined the phenomenon of “gender schemas” or culturally bound assumptions about men and women that are unconscious. One of the impacts of this is that women are first assumed incompetent until proven otherwise, but it’s the opposite for men. Men are assumed competent until proven otherwise. The assertion being that consequently cultural biases consistently overrate men and underrate women with self-assessment studies showing that men and women do the same to themselves.
So how do we tackle what we are potentially all subconsciously hard wired to think? First we need to recognise where this is coming from, and it’s conditioning from the past. It’s important that we acknowledge and address this, otherwise not only will we fail to achieve true equality, but we will miss out on a huge amount of talent and ability that could really drive progress and higher levels of performance in business, Government and all other spheres of life. To move forward we need to assess men and women the same. Not on who they are, with all the subconscious assumptions and biases that brings, but on what they do, what they achieve and the real impact they have.
So, returning to my earlier question, what can we do to improve the number of women at the top? Other than removing outdated barriers and addressing our own insidious social conditioning and biases, we can also recognise that truly effective leadership today is different from what worked even just 20 years ago.
With more volatility, uncertainty, complexity and ambiguity faced by business and the wider world than ever before, now more than ever a new breed of leadership is needed, and I’d argue women and diverse leaders are just as well placed, if not even more so, to provide it.
One of the benefits of being Chair of Real World Group, originally a University spin out company with a strong pedigree in research, is the opportunity it has given me to get greater insight into their extensive leadership research. Research that over the years has included numerous studies about what really delivers truly effective leadership. For me one of the most critical elements is that these studies have been not just some of the largest, but also the most inclusive in terms of the diversity, including gender, of the leaders studied. The leadership model they created as a result ‘Engaging Transformational Leadership’ was ahead of its time when first proposed in 2001. Further study since and extensive external evaluation and validation, as well as its successful application in the real world, has shown it to be truly effective in not just positively transforming organisational performance, but also in enhancing levels of employee wellbeing and engagement. The unique aspect of the model being that its foundation is on behaviours that have been proven to work, regardless of gender, ethnicity or other demographics. It is a truly ‘unbiased’ model. Whilst I am clearly an advocate of this model of leadership my key point is a broader one. If we assess a leader’s ability and skills against a traditional model of leadership, those who do not fit the historical template will always be disadvantaged. Moreover they will not be accurately assessed against what is needed in the current landscape, resulting in leadership roles potentially being occupied by more of the same, rather than what is really fit for purpose now.
So let’s stop judging women and diverse leaders against outdated leadership criteria that no longer work in today’s world. Resourcefulness, resilience, mental agility, persuasive communication, authenticity, balancing competing priorities and risk, creative solutions, partnership working and stakeholder engagement. These are increasingly the skills today’s leaders need, and these are all areas in which women can excel.
To end where I started the striking fact that as a FTSE 100 CEO, you are as likely to be named Dave or David as you are to be female is hard to ignore. As are some of the ‘explanations’ given to the Hampton-Alexander Review by some of the FTSE 350 Chairs and CEOs about why they don’t have more women on their boards. There were a few gems to choose from but “I don’t think women fit comfortably into the board environment” was the one that for me perhaps was the most telling about why more progress has not been made. The fact this view was not just held, but also shared as part of a Government backed review sharply illustrates how far we have to go. It’s not that I believe that comments like these are the result of deliberate intransigence from ‘bad people’, but merely a reflection of decades, indeed centuries of social conditioning and let’s face it, historical reality. But therein lies the real challenge, and as I admitted above, it’s not just men that need to update their mindset to the reality of where we are today, and the equal role and ability women have in truly effective leadership.