Creating An Employee Executive Board Will Close the Gender Gap in Business
I believe that women are an awesome force. And I'm not biased because I'm a woman -- the stats speak for themselves. Women make up half of the global population, contribute $7 trillion in US consumer and business spending and drive 85% of all consumer purchasing. That's pretty awesome.
But the power of women in the economy isn't translating to the workplace. While women represent 47% of the US workforce, we hold less than 20% of Fortune 500 Board seats, 14% of the top five leadership positions at the companies in the S&P 500 and 4% of S&P 500 CEO spots. There are even more men named John running large corporations than there are women CEOs.
The business case for gender parity is evident. As Sallie Krawcheck, Chair of Ellevate Network, has pointed out, "More diverse companies have higher returns, lower volatility, lower risk, more client-focus, more innovation. Diverse leadership teams out-perform smarter, more capable leadership teams."
But the gender achievement gap in business still exists. We are seeing some progress on closing the gap as the conversations around women in the workplace increase and more and more companies implement programs around sponsorship, women on boards, family leave, professional development and work/life balance. But if the US is going to Step It Up for Gender Equality and reach gender equality by 2030, we need to up our game.
So what's the solution? When we asked Ellevate's community of professional women what's worked best at improving diversity in their company, the top answer (35%) was senior management engagement. This makes sense since senior leadership sets the tone for the company -- policies, culture, expectations and objectives- - which in turn sets the paradigm through which all internal decisions are made. But we know that men hold 86% of the top leadership positions. While the engagement of senior leadership is a top driver for closing the gender achievement gap, will lack of diversity beget diversity?
Corporate Boards could help close the gender achievement gap in business as senior leaders often look to them for input on everything from compensation, restructuring, and business prioritization to social responsibility. But corporate boards are 80% male and most don't view diversity as a priority.
Client opinion directly impacts business progress like product development and marketing. And we've seen clients influence senior leadership's prioritization of diversity in the workplace, such as the efforts of General Counsel to drive diversity in law firms. But these efforts are determining priorities, not solutions. And what we need now are solutions.
The most valuable partner that senior leadership has in its quest for gender parity is the most obvious: employees. Makes sense, right? But female employees are an underutilized resource. 87% of Ellevate Members say that gender discrimination still exists at their companies and when we asked Members if they feel they have a say in their company's policies and culture as it pertains to women and working families, 53% said no.
How do we engage women in closing the gender achievement gap and in turn driving better performance and better returns? Companies need an Employee Executive Board. Unlike current employee-based diversity committees, the Employee Executive Board works in conjunction with senior leadership and must have the power to not only set diversity goals for the corporation but also dictate the measures necessary to achieve these goals.
The Employee Executive Board is an independent internal committee that convenes key stakeholders - the Corporate Board of Directors, senior leadership, clients and employees and, in doing so, is the hub around which business will evolve, innovation will happen and change will be created. As President Barack Obama said "[w]omen's empowerment and their full participation on the basis of equality in all spheres of society, including participation in the decision-making process and access to power, are fundamental for the achievement of equality, development and peace."
Still not convinced? Then consider the other benefits of engaging women in closing the gender achievement gap within your company.
- FOCUS ON GENDER EQUALITY: When diversity is a priority, having an Employee Executive Board that focuses 100% on this goal is critical. Senior management is enmeshed in the business strategy and profits and can easily get distracted from the diversity agenda.
- FIRST-HAND KNOWLEDGE: Giving women, many of whom have faced or will face sexism in the workplace, the opportunity to change these inequalities will yield impactful solutions.
- CULTIVATE LEADERS: What better training for high potential women than on-the-job leadership? An understanding of the business landscape that needs to be navigated when implementing policies (financial impact, personnel resources, etc) is the best training for leadership a company can offer.
- PUBLIC COMMITMENT: Companies that have women represented on an Employee Executive Board lead by example. They send a clear message that they value diversity of thought and experience.
- EMPLOYEE ENGAGEMENT: Having an Employee Executive Board engages key stakeholders within the company that can help champion positive change at all levels of the organization.
- FINANCIAL REWARDS: If women hold 50% of entry-level positions in the workforce but only 14% of senior leadership position then there is a major leak in the funnel. The total cost of this turnover is 150 percent of annual salary for a mid-level employee and 400 percent for a highly specialized or high level employee.
As UN Secretary-General Ban Ki-moon said, "Too often, leaders have used women to advance power. I believe we must use power to advance women." Until women have power, change will not happen.
This article first appeared on the Hufington Post.
This post is part of a blog series produced by The Huffington Post in conjunction with International Women's Day, celebrated on March 8, 2016. A What's Working series, the posts address solutions tied to the United Nations' theme for International Women's Day this year: "Planet 50-50 by 2030: Step It Up for Gender Equality." To view all of the posts in the series, click here.
Follow Kristy Wallace on Twitter: www.twitter.com/kristysisko
Toss the old diversity and inclusion playbook — there's a new set of rules. Download the e-book from Sallie Krawcheck here.
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