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Business Development & Marketing Finance General

Is gender parity in business a utopian dream?

gender parity in Soviet statusRarely a week goes by when some aspect of gender parity often defined as equality is not in the headlines.
Back in April, just ahead of a Government deadline for firms to report on the gender pay gap within their businesses, the BBC reported that nothing much had changed since the initiative was announced.
Its analysis revealed that fewer than half the UK’s biggest employers had succeeded in narrowing their gender pay gap. In fact, in 45% of firms the discrepancy in pay increased in favour of men and overall in 75% of businesses the gap was in men’s favour.
By July, the focus had shifted to the representation of women on the boards of FTSE100 and FTSE 350 companies. While representation of women on FTSE100 company boards had improved since 2011, from 12.5% to 32% according to the Hampton-Alexander review, many of the leading broadsheets were accusing businesses of adopting what they called a “one and done” policy and that any such “improvements” were a token gesture.
Furthermore, a study by Cranfield University, supported by the FRC (Financial Reporting Council) found women typically hold executive director positions for half as long as men and are more likely to hold an advisory non-executive position than a top managerial role.
When it came to women entrepreneurs and finance there was not a lot about which to be optimistic.
The Independent reported in August that a mere 13% of senior members of UK investment teams are female and only one in five firms was founded by a woman. Indeed, the Government’s Rose Review found that a lack of start-up funding is the number one barrier preventing women from starting a business, with women starting businesses doing so with 53% less capital on average than men.
The Review of Female Entrepreneurship was carried out by Alison Rose, who is currently CEO of commercial and private banking at NatWest and is in line to become the first female boss of a major UK bank if she secures the role of CEO at RBS.

Is there any chance of realising the utopian dream of gender parity in business?

Firstly, the gender parity issue relates mainly to the number of women in senior roles.  Too many of those opining on the issue only compare the pay data for each gender across businesses often claiming that men earn more than women without acknowledging that women are generally fulfilling the lower paid roles. Commentators all too rarely look at pay levels for the two genders doing the same job.
Indeed, there are plenty of men in business who support the ideal that women and men fulfilling identical roles should be paid the same.  In the same vein most men believe that more women are needed in senior roles.
However, the fact is that culture and work demands on those in senior roles remains deeply biased against women in most businesses.
For example, Andrew Hauser, executive director of markets at the Bank of England, said in a recent speech at an event intended to promote careers in forex to women, that a “bro-culture” encouraged financial crime in the foreign exchange markets in recent years.  He described it as a “toxic male environment” arguing that it made terrible business sense to not have more senior women in finance.
But the problem of encouraging more women to seek senior roles in business goes much deeper than that.
In an article in the Guardian on Sunday, Yvonne Roberts unpicked the assumptions that underpin the discipline of Economics, which she argued would remain “a man’s game” while women’s contribution to the economy continued to be undervalued when compared to men’s.
She quotes Mary-Ann Stephenson, director of WBG (Women’s Budget Group), an international independent think-tank that is now part of a global network of feminist economists: “Classical economics is based on the independent man who works full time and is in control,”. As such, calculations of a country’s GDP (Gross Domestic Product) largely ignores not only women’s direct economic contributions from work and business, but the often-unrecognised social contributions many make that support the smooth running of the economy.
This, the article argues, was recognised by New Zealand’s leader, Jacinda Ardern, whose government in May produced the first ever Wellbeing Budget which allocated millions to child poverty and narrowing the inequality gap.
Clearly utopia will only become a reality if some fundamental and deep-rooted assumptions are changed.

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Business Development & Marketing General Turnaround

Corporate boardrooms – a hostile environment for female executives?

Rani Lakshibai - a woman taking on a hostile environmentDespite the depressing picture of a decline in the number of women holding senior executive positions in FTSE companies, there have in the past been many impressive female leaders such as Rani Lakshmibai, the Queen of Jhansi in India, who led her troops in battle (with her baby son strapped to her back) during the Indian Mutiny/First War of Independence in 1857.
In July this year the UK’s Cranfield Institute published the results of its 20th FTSE Women on Boards Report which reported a marked drop in the numbers of female CEOs (chief executive officers) and CFOs (chief financial officers) and other executives on the boards of FTSE 250 companies and that the numbers had remained static for FTSE 100 companies.
It found that there were 30 women in full-time executive roles at FTSE 250 firms, down from 38 last year, equating to just 6.4% of the total, and of these there were just six female CEOs and 19 CFOs.
Although the numbers of female executives in FTSE 100 companies had risen from 27.7% in October 2017 to 29% by July 2018, the women recruited were largely in non-executive director roles.
All this is despite a drive to reach a target of 33% of female executives on FTSE 100 boards by 2020, set by the government-backed Alexander-Hampton review.
At the moment just four FTSE 100 companies – the retailer Next, the online estate agent Rightmove, the financial services provider Hargreaves Lansdown and the builder Taylor Wimpey – have 50% or more women on their boards. The CBI (Confederation of British Industry) director general is also a woman, Carolyn Fairbairn.
Among the USA’s Fortune 500 companies, analysed by the Pew Research Centre, it is much the same story. Just 10% of 5,700 CEOs and CFOs in Standard & Poor’s Composite 1500 stock index companies are women.
There have been some high-profile female CEO resignations too, including Indra Nooyi, from PepsiCo, Denise Morrison, from Campbell Soup, and Meg Whitman, from Hewlett Packard.

Changing the boardroom culture to a less hostile environment for female executives

There is some evidence that the way female executives are treated is different from the way male executives are.
In an article in the Evening Standard recently the writer Anthony Hilton cited the treatment of top 10 accountancy firm Grant Thornton’s female CEO Sacha Romanowich, who he said was “effectively forced to resign” after three years.
An anonymous memo was sent to the press, he says, raising concerns about Romanowich’s alleged “socialist agenda”.  She had talked about social mobility, capped her own remuneration to well below that of other Partners in Grant Thornton and introduced a scheme to give all the staff a share of the company’s profits. Some of the company’s rivals spoke out about the brutal treatment she had been subjected to.
It was a similar story of rumour, innuendo and gossip, he says, that led to the eviction of Barbara Judge last year as chair of the IoD (Institute of Directors).
The question is whether such tactics would have been used against male executives.
On Tuesday this week, the Guardian reported on a call from Sir Philip Hampton, chair of the Hampton-Alexander Review referred to earlier, for consumers to boycott the firms that are “so clearly out of touch”.
This was after it was found that Five British companies have failed to appoint a single woman to their boards two years after the target set by the Review.
Sir Philip, who is the CEO of pharmaceuticals company GlaxoSmithKline, said: “it would be good to see pressure from the media, politicians, ourselves [as business leaders] and consumers” put on companies that are clearly out of touch with the 21st Century.
There is a theory, called the Glass Cliff, that says that women (along with other “minorities”) are more likely than white men to be promoted to CEO of weakly performing firms or during times of economic decline. Arguably, therefore, they are being set up to fail. If true this is appalling.
Historically, we are not short of examples of able female leaders, from the Rani of Jhansi mentioned above to Boudica or Boudicca, a queen of the British Celtic Iceni tribe who led an uprising against the occupying forces of the Roman Empire in AD 60, to Queen Victoria, who ruled over the vast British Empire, to two female leaders of the Tories, Margaret Thatcher and Theresa May.
It is true that female politicians are subject to some appalling bullying, insult and harassment particularly on social media.
It is also not unusual for male executives to explain the lack of female executives with excuses such as a shortage of suitably able female candidates, or that women are temperamentally unsuited to the cut and thrust of the boardroom.
Is it any wonder that in such a hostile environment for women the 19th and 20th Century attitudes of the male dinosaurs in many boardrooms are so hard to change despite the fact that they are limiting their businesses to a narrower pool of available talent than they otherwise might have?