Gender inequity must be addressed as key business issue

As employers wind down for the year and start to think about their priorities for 2017, it is important gender equality is placed near the top of their list.

A succession of reports – from McKinsey, Goldman Sachs, Credit Suisse, and the Grattan Institute – have consistently identified a link between gender equality and better business performance and outcomes.  In a turbulent international economic environment then, greater diversity helps to protect an organisation against future shocks. 

However, the Workplace Gender Equality Agency’s new dataset shows that the Australian business community is still not taking full advantage of these benefits.

Every year the Agency collects almost 5000 reports from more than 12,000 employers covering more than four million Australian employees. A unique dataset; the measures covered include pay, workforce composition, flexible working arrangements and specific actions employers have taken on gender equality at work.

The Agency’s recently released 2015-16 data shows that across the nation women still face a pay gap of 23 per cent based on total remuneration – a difference of almost $27,000 in the average full-time pay checks of men and women. Every industry in Australia has a pay gap – even the female dominated ones. Across the dataset other disparities are also obvious; women dominate part-time and casual roles, and are less likely to work in management - only 16.3 per cent of CEOs are women and only six per cent of managers work part-time.  The Australian workforce is also highly segregated; women are more likely to work in health care and education, while men dominate the mining and construction industries.

While there are positive signs of change in the data – over 70 per cent of employers now have a gender equality policy or strategy – it is clear that for real change to occur targeted, effective action is required on the part of all employers.

That action must begin with employers analysing the state of play in their business, forming an action plan and reporting the results to their executive and board. This is a familiar process for anyone who has ever analysed and addressed any other business issue. Yet the Agency’s dataset shows that only a small portion of Australian employers are taking this comprehensive and strategic approach.

In the last 12 months only 27 per cent of employers analysed their payroll for pay gaps. Of those organisations, less than 15 per cent went on to report the results to their board, and only a quarter reported them to their executive. Too often action on gender equity is stuck at the HR level – for real change to occur it must come from the top.  

Reporting organisations can use the confidential, tailored Competitor Analysis Benchmark Reports the Agency provides to help them review this data and report it to their executive. These reports outline measures including each employers pay gap, number of women in management, and appointment rates by gender – all compared with their closest competitors.

The reports are available now on the Agency’s secure reporting portal.  Once that data has been analysed and an action plan developed, reviewing progress should be a standing item on every board’s agenda.

Employers must also use this strategic approach when addressing how men and women work, as these fundamental assumptions in our workplace are still major contributors to workplace inequality. 

Research consistently shows that men want more flexibility at work, yet women are three times as likely as men to work part-time. This dynamic means that men are less likely to have their lives outside of work – including caring responsibilities – recognised or supported, while women struggle to progress their careers. As only six per cent of manager roles are worked part-time, many female employees are automatically locked out of a managerial career path.

Currently, 63 per cent of employers have a flexible working policy or strategy – an encouraging development. However, employers must work harder at creating workplaces in which employees of all genders and at senior levels are given real permission to use these schemes. Increasingly, employers are addressing this by taking the decision-making out of the hands of managers – for example by using an all roles flex model on an if not why not basis or removing standard working hours from contracts.

One area where we are not seeing enough change is in industrial and occupational segregation across the workforce – the concentration of women and men in different roles and sectors. Agency data shows that across Australia six out of 10 employees work in an industry dominated by one gender. This impacts on the pay gap as traditionally male dominated industries have been valued more highly than female dominated ones.

Many male-dominated organisations still complain that “there just aren’t any women applying”, but experience shows that with commitment this can be overcome. Infrastructure firm AECOM recently achieved a gender equal split within its graduates for the first time by connecting with university student societies and by more efficiently targeting women during their graduate recruitment campaign. In the software sector MYOB is increasing the number of women in its programming team by retraining workers who have taken a significant break from the workforce.

Ultimately, we will only address gender inequity when all employers see it as a key business issue which needs to be addressed with data, commitment and the firm belief that this is good for business.

In November 2016, Workplace Gender Equality Agency Director, Libby Lyons presented the results as part of a CEDA series around Australia, watch her address here.