The number of organisations who have reported on their gender pay gap has halved since...read more
Gender diversity at companies leads to markedly better performance, yet most executives don’t have a clear plan for achieving it, according to a new report by The Boston Consulting Group.
The report, titled Getting the Most from Your Diversity Dollars, is being released, analyses survey data from 17,500 male and female employees at organisations around the world, along with interviews of 200 senior leaders. The results show a consistent mismatch between the effort level of companies and the actual progress those efforts generate. For example, 91% of women said they were aware of gender-diversity initiatives at their company, yet only 27% said that they had benefited from those initiatives. In the UK, the comparative figures were 92% and 26%, with just 37% saying they had been exposed to the initiatives.
A central challenge, says the report, is that senior men and women start with different perspectives on what matters. Men tend to think the biggest challenges lie in recruitment, while women point to retention and advancement as the biggest issues. “Given that the leadership teams at most companies are predominantly male, those differences can lead to a misallocation of resources,” says Matt Krentz, a senior partner at BCG and co-author of the report. “Instead, it’s important for leaders to understand which investments can have the greatest impact.”
The report says company leaders need to treat gender diversity the same as any other strategic objective, focusing on a small number of measures that are likely to yield the biggest pay-off. The report looks at 39 initiatives and ranks them by their effectiveness.
For example, many companies have established baseline measures such as mentoring programmes for women who show high potential. Yet mentoring often depends on face-to-face meetings that can be informal and sporadic. Although such meetings can sometimes help women navigate a tough spell at work, they often aren’t enough to change a woman’s career path, says the report. Similarly, offering a one-time training session for managers or adding diversity to executive compensation targets tends to have far less lasting effect than leaders might think, it states.
However, other measures are “hidden gems”, for example, increasing the visibility of role models who have come up through the organisation and engaging male employees in diversity efforts or providing additional support to women at “moments of truth” in their career, such as when they return from maternity leave, take an international post or receive a promotion that gives them significantly more responsibility.
“These are critical junctures in a career path,” says Miki Tsusaka, a senior partner at BCG and co-author of the report. “They’re short periods where companies can make a targeted investment to help women, and those investments can pay off disproportionately.”
In the UK, there was a difference between what female employees and their senior managers felt were the barriers to gender diversity. Women tended to cite obstacles related to retention (39%) and advancement (34%) in their roles as the most important to tackle whereas senior managers tended to blame the thin recruitment pipeline as the most significant barrier to progress.
Some 54% of UK employees identified flexibility as the most effective intervention at their company and including men in diversity programmes was felt to have a significant impact: 74% of respondents at UK companies where men were involved in gender diversity reported that their company had made progress versus 11% at companies where men were not involved. However, the report found male involvement remains limited in UK organisations – fewer than 50% of employees surveyed believe that the men in their company are involved in championing gender diversity.
The report also highlights case studies of global companies that have successfully put certain effective measures in place, including pharmaceutical giant GSK, Commonwealth Bank of Australia, Unilever, Bank Muscat and PepsiCo.