Embrace Gender Parity For Better Business Performance

There is a growing body of research that suggests a positive correlation between gender parity and business performance. 

McKinsey's "Delivering Through Diversity" report found that companies in the top quartile for gender diversity on their executive teams were 21% more likely to experience above-average profitability than companies in the bottom quartile. The Peterson Institute for International Economics conducted a global survey of more than 21,000 firms in 91 countries, and found that having women in corporate leadership positions is positively related to firm profitability. Specifically, the report found that the presence of women in corporate leadership positions is associated with a 15% increase in profitability.

A study by the Boston Consulting Group (BCG) found that companies with more diverse management teams have higher innovation revenue. Companies with above-average diversity scores generated 45% of their total revenue from innovation, compared to just 26 per cent for companies with below-average diversity scores. A report by the Credit Suisse Research Institute found that companies with at least one woman on their board outperformed all-male boards in terms of share price performance and return on equity.

Clearly, gender diversity in the workplace is not only a matter of social justice and equality but also makes good business sense. Yet, few Indian businesses are driven by this agenda. As a nation, we are ranked 140 amongst 156 countries in the WEF Global Gender Gap Index. Women employees represent only 23 per cent of the total workforce, and the parliament has not even 15 per cent of women representation. Just 14.6 per cent of Indian companies have a female CEO, and the percentage of women on boards is 17 per cent. The data highlight the need for greater gender parity.

Gender parity and pay parity go hand in hand in order to ensure that such initiatives continue to progress. Indian enterprises can find inspiration from global best practices and success stories. Companies like Sodexo, L’Oreal, Schneider Electric and Accenture have almost achieved gender parity in senior leadership teams, and have seen the results of this effort on their performance. 

Pay parity, or equal pay for equal work regardless of gender, is an important issue for companies around the world. While many companies are making progress towards achieving pay parity for women employees, there are still relatively few that have achieved it fully. Salesforce.com was one of the first to achieve pay parity way back in 2016. Adobe, BHP, Ikea, L’Oreal and Roche are some of the other leading global giants that did it. 

It is important to note that while these companies have made significant progress towards gender and pay parity at the top, there is still more work to be done to ensure that all companies are inclusive and equitable for all employees, regardless of gender.

What best practices can Indian enterprises adopt to drive gender parity, and therefore better business performance?

• Provide equal opportunities for development and advancement: Companies should provide equal opportunities for development and advancement to all employees, regardless of gender. This might include mentorship programmes, leadership training, and sponsorship opportunities.
• Create a culture of inclusion: Indian enterprises should create a culture of inclusion, where all employees feel valued and included. This could be via creating diverse and inclusive teams, promoting open communication, and celebrating diversity and different perspectives.
• Offer flexible work arrangements: Start offering flexible work arrangements such as work times and remote work options, to accommodate the needs of all employees, including those with household responsibilities.
• Ensure pay equity: Board of directors must urge management to ensure pay equity, where all employees are paid fairly for the same work, regardless of gender. This might involve conducting regular pay audits and making adjustments as necessary.
• Use gender-neutral language in job descriptions and evaluations: While recruiting for any position, use gender-neutral language in job descriptions and evaluations to reduce bias and ensure that all candidates are evaluated fairly.
• Establish gender quotas and targets: Think of establishing gender quotas and targets to encourage the recruitment and promotion of women to leadership roles. Quotas can be used to ensure that a certain percentage of leadership positions are held by women, while targets can be used to encourage the recruitment and promotion of women.
• Foster a supportive network: What most Indian companies lack is this supportive network of women, where women can share experiences and support each other in their career development. To get this done right, include employee resource groups and networking events.
• Encourage work-life balance: When can enterprises encourage work-life balance? Start by offering parental leave, flexible work arrangements, and other benefits that support employees. Even if you are not able to offer special benefits, at least try to reduce their workload so they can go home after regular work hours. 
• Hold leadership accountable: Get leadership teams to be more accountable for progress towards gender parity goals, and provide regular reporting on gender parity metrics. This can help to ensure that progress is sustained over time.

Muneer is a Fortune 500 consultant, author, startup investor/mentor and co-founder of the non-profit Medici Institute. Twitter @MuneerMuh

Dr M Muneer

Guest Author The author is Co-founder and Chief Evangelist at the non-profit Medici Institute Foundation for Diversity and Innovation; and also the CEO of CustomerLab Solutions, a strategy execution and disruptive innovation consulting firm.