Women at the top still a distant reality
In general, gender equality is not reached on a board until women constitute 95 per cent of staff. Photo: Daniel O'Brien
With a female Prime Minister, Governor-General and deputy opposition leader, Australia has women in key leadership positions. Unfortunately, these breakthroughs enhance the paradoxical reality for many working women: the statistics tell us that leadership positions for most women remain a distant reality.
The sector making considerable headway in this regard is Australia's community and not-for-profit sector. Our study, Reflecting gender diversity: an analysis of gender diversity in the leadership of the community sector, shows the sector leads the way in workplace gender equity. Women make up 60 per cent of senior management roles and 51.4 per cent of board director roles, well ahead of the private and public sectors.
There is no doubt that these are impressive figures. However, closer analysis shows there is a long way to go. With women making up an extraordinary 85 per cent of the sector, there are legitimate concerns that the pathways to leadership and management for the many women working in the sector still contain obstacles. Under-representation of women in leadership is not unique to the community sector, but it was particularly concerning to find that the comparatively higher representation of women in senior roles is mainly in smaller organisations. The higher the turnover - $30 million or over - the fewer women there are holding positions on boards. Moreover, our findings reveal that, in general, gender equality is not reached on a board until women constitute a staggering 95 per cent of staff. And 31 per cent of treasurers in the survey organisations were female.
Moreover, while our report shows that women are doing better in the community sector than in other sectors, we are conscious that they do so at a time when the healthcare and social-assistance sector (which includes the community sector) has the largest gender pay gap of any industry in Australia, at 32.6 per cent. The United Nations has recognised that women's economic dependence on men can prevent them from taking part actively in public life, including in leadership roles. We remain hopeful that next year's Equal Pay Day will tell a different story about the economic independence of women in our sector: significant headway has been made with the historic Fair Work Australia ruling on equal pay for community sector workers earlier this year. Perhaps next year it will not take women 64 extra days to earn the annual male wage.
A key finding of our report is that participation of women in the workforce does not automatically lead to equality of opportunity for women. Instead, concerted and considered attention is required in order to address the gender pay gap and the dearth of opportunities for women's leadership, including by addressing the impact of society's ideas about caring work on women's leadership aspirations. The UN's Committee on the Elimination of Discrimination against Women points to the fact that women and men do not share caring work of children and family members, and this inhibits women's ability to take part in public life.
For this reason, the UN has called on governments for many years to strengthen women's leadership, including by implementing short-term targeted measures that will increase the number of women in leadership. Our report found that, within the community sector, more survey respondents supported the introduction of mandatory quotas than respondents who didn't. A leading example of successful implementation of mandatory quotas is Norway, which, according to a 2011 study, doubled the percentage of women on boards compared with the other 11 countries examined when they introduced their quota for boards.
In Australia, short-term targeted measures include reporting to the Equal Opportunity for Women in the Workplace Agency. Rather worryingly, our research indicated that 76 per cent of community service organisations with 101-200 full-time equivalent staff were not reporting to the agency. Proposed laws to strengthen the agency's regulatory role by penalising non-reporting organisations will give the agency much-needed teeth; however, this should be coupled with a commitment to educate the community sector on their requirements under such legislation.
There are widespread benefits from having more women in decision-making and leadership roles in organisations, aside from enabling us to achieve a fairer and more socially just society. It makes good economic sense. The Reiby Institute report on ASX500 Women Leaders found that top companies with women directors delivered an average return on investment 10.7 per cent higher than those without, over three years. Companies with women directors delivered an average return on equity 11.1 per cent higher than those without women directors over five years. In eight out of 10 sectors, companies with women directors demonstrate higher return on equity than those without women directors.
It makes sense that a society can only reach its full potential when the participation of women is encouraged, realised and acknowledged at all levels, in all sectors. While the community sector has come far, there is still a considerable way to go.
And across the private and government sectors there is even more work to be done. An interesting finding in our report was those organisations which derived almost all their income from government were more likely to have a high percentage of women on their boards. This suggests - given familiarity with the regulatory context of government - a pathway between community sector boards and government boards. No doubt there are other unexplored pathways and opportunities between our sectors, and we would do well to explore them together.
Dr Caroline Lambert is executive officer of YWCA Australia; Dr Cassandra Goldie if chief executive of the Australian Council of Social Service; and Ruth Medd is chairwoman of Women on Boards.