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Boosting your bottom line through embracing gender diversity

by Janet Musgrave on 14 May 2018
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Research tells us that embracing gender diversity at the senior level delivers business benefits. But what’s behind the noise? Do we really know what works, and does it really matter?

This was the topic of discussion at a round-table event held at BIE offices last month. The event was co-hosted by BIE and The Pipeline’s Margaret McDonagh, who shared insights based on her experience of working with senior women to develop their careers and with organisations to create the environment to make this happen.

McDonagh is a former Non-Executive Director of TBI Plc and Standard Life and was the first woman and youngest ever General Secretary of the Labour Party. Alongside Lorna Fitzsimons, former CEO of the Britain Israel Communications and Research Centre (BICOM), they founded The Pipeline.

The Pipeline offer a tried and tested diagnostic tool that helps organisations uncover the barriers to achieving greater diversity, and their flagship programme Top Flight helps women with potential take that last difficult step to senior leadership roles.

Also attending the event were HR leaders from companies including Grosvenor Estates, KPMG, Zoopla, Iron Mountain, Experian and Newday.

The bottom line

The Pipeline have done extensive research around gender statistics and challenges in organisations. Their research reveals that profit margins are almost double in companies with at least 25% females on their Executive Committee compared to those with none.

This is supported by research by McKinsey, who found that senior management teams of global companies with three or more women had a higher performance, on average, than teams with no women.

It’s clear that the value of getting more women into senior roles is more than just ‘noise’. The reality is that an organisation’s bottom line is stronger with a better blend of gender at the top.

So how can organisations embrace and develop their female talent? And what challenges need to be overcome?

One of the key points emphasised by McDonagh was that organisations should be setting big targets when it comes to bringing more women into senior level roles. Evidence suggests that going big is more effective than trying to bring in more women in bitesize chunks. And it’s true that having more women in leadership roles will, in turn, encourage more women to aspire to senior roles. In essence, the more women we see move into leadership roles, the more chance organisations have of seeing benefits to the business.

The value of sponsorship

The importance of sponsorship in driving gender diversity was discussed in-depth at the event. The Pipeline’s research suggests that women are over mentored and under sponsored, and according to McDonagh, it’s sponsorship that makes the difference.

A key theme that came out of the discussion was that there is often a discord around the true meaning of ‘sponsorship’. There is a tendency for senior leaders to group mentoring, coaching and sponsorship together - assuming they're all the same thing.

However, the difference between mentoring and sponsorship is substantial. While mentors give advice on meeting goals and provide feedback on assignments, sponsors effectively ‘fly the flag’ for their protégé. Typically, a person would be sponsored by someone in the organisation completely unrelated to what they do and the area they work in. The sponsor’s role is to open doors for them, give them opportunities, and encourage their line managers to offer them the same.

Notably, the benefits for women of having a sponsor are measurable. Research by Forbes conducted at the Center for Talent Innovation (CTI), found 68% of women with a sponsor feel their rate of career advancement is satisfactory, compared to 57% of unsponsored women.

It was universally felt around the room that there is merit in encouraging sponsorship of female talent. It’s about getting people to think, ‘Who are the female up and coming high flyers?, and, ‘Who are the women in the business who need more support?’

Overcoming challenges

There was much acknowledgement about the differences in how men and women present themselves in the workplace. We spoke about how in the context of an interview, female candidates are more likely to hone in on their weaknesses and areas for development, whereas their male counterparts are more likely to stick to selling their strengths. How organisations recognise and react to these differences is a challenge.

There’s also the issue of unconscious bias. If a man and a woman are equally matched for a leadership role, the man is often considered the ‘safe’ choice. Even now, it’s still a reality that women’s promotions are seen to have more risk attached. According to McDonagh, there’s no evidence of any difference in the success of women with children compared to women without children. And it’s crucial that organisations recognise this.

We also explored gender differences in promotion into senior roles. Women may take longer to make an impact, taking the time to make sure they’re understanding the environment, the politics and the ways of communicating before they share their ideas. Organisations need to be mindful of this way of working and give women time and space to carve their mark.

Critically, some HR leaders around the room responsible for driving gender diversity reported hitting brick walls when it came to getting buy-in from the top. There was a definite sense that leaders can be apathetic about gender diversity. The CEO's role is a critical one - an organisational shift in gender enrichment needs to come from the top.

It’s clear that embracing gender diversity at the senior level can have a significant positive impact on an organisation’s bottom line and organisations need strategies in place to make this happen.

McDonagh’s takeaway was that if you’re going to focus on something - focus on sponsorship. What’s more, business leaders need to think about how they can turn sponsorship into a strategic priority. As what’s apparent, is that bringing more women into senior level roles is reliant on support from the top.

Creating adaptable businesses

Topics: HR