How to
Achieve
Gender Parity

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To end pay disparities and equalize employment opportunities for men and women, company leaders must ensure there is an empowering culture and progressive policies in place to give women equal power, opportunity and status.

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BY AVE RIO

“L

ike a lot of women, I don’t think I was woke until Nov. 9, 2016,” said Annie Williams, the team lead for women’s issues at Indivisible Illinois. After the election, Williams joined the Women’s March and was inspired, like so many others, to fight for equality.

Williams said she has encountered implicit bias throughout her life. “I can remember when I would be in meetings and I would say something, and it would be totally shot down,” she said. “And within that same meeting a guy would say the same thing and all of a sudden it was the greatest idea ever. I was in IT, and it was always a struggle for me to prove that I could work as well as the guys. I want my nieces and nephews to grow up in a society where this is not an issue anymore.”

There are too many informal circles where — more often than not — men have better opportunities to be seen and known [for promotions].”

— Kim Davis, executive vice president and chief human resources officer, NFP

It will take 217 years to end pay disparities and equalize employment opportunities for men and women, according to the most recent estimates by the World Economic Forum.

“In the last year and a half in particular — but throughout history — we’ve seen that women raising their voices and women’s allies raising their voices beside them and on their behalf, is what makes change,” said Sharmili Majmudar, director of strategic partnerships at Women Employed, a nonprofit organization that advocates for women in the workplace. “It’s only possible if we are working together to raise our voices, share our experiences and make sure that we are communicating loudly and clearly that it’s not OK, that we’re not going to tolerate it anymore and that we expect our elected officials and employers to stand up for what is right.”

Changing the Culture Starts at the Top

Social and economic barriers such as access to education, child care, household responsibilities and inherent cultural biases play a major role in preventing equality in the workplace, but there are specific actions companies can take to create a culture to lessen the problem.

Accenture’s “Getting to Equal 2018” report found that women are four times more likely to rise in corporate ranks if a culture of equality exists. The report outlined 40 factors that directly influence women’s advancement. Those factors are divided into three categories: leadership attributes, bias-free policies and a culture that respects individuals and offers freedom and work flexibility. The research showed that if all organizations created environments in which these 40 factors are most common, women’s pay could increase by 51 percent. On average, that’s an additional $30,000 per woman each year.

One of the 40 factors is that the proportion of women in senior leadership has increased over the past five years. According to the Accenture report, nearly three times more women are on the “fast track” to leadership in organizations with at least one female senior leader than in organizations without any. Further, companies where leadership is held accountable for improving gender diversity are 63 percent more likely to have seen an increase of women in senior leadership roles over the past five years. With the adoption of these 40 factors, Accenture also estimates the ratio of managers could improve to 84 female managers for every 100 male managers, as opposed to the 34 in 100 current ratio.

“It all starts with the senior leadership team believing in what we’re doing, not just as a thought process or as a speaking point, but truly believing,” said Kim Davis, executive vice president and chief human resources officer at insurance brokerage and consulting firm NFP.

Davis said the executive team at NFP has made advancing women in leadership a top priority. She said the top women in the organization formed a council and worked with the leadership team to pinpoint areas of improvement that can help the firm empower women and reduce gender inequality.

The promotion process can breed inequality, so there should be a companywide posting process to avoid someone being preselected for a promotion. “There are too many informal circles where — more often than not — men have better opportunities to be seen and known [for promotions],” Davis said. “Many times, they’ll put someone in a role without looking at a diverse slate of candidates.”

For the past three years, the firm has been tracking the ratio of women to men in the company. About 60 percent of their workforce is women; about 72 percent of all the compensation changes and promotions at NFP went to women in the company in the past few years, Davis said. “We’re starting to be able to see a market improvement in pay changes and promotions,” she said.

In order to make significant improvements, leaders should track internal progress against their own baseline and set both short-term and long-term goals, said Jewelle Bickford, co-chair of the Paradigm for Parity coalition, an organization made up of various leaders and senior executives with a mission to achieve full gender parity by 2030; their near-term goal is that women hold at least 30 percent of senior roles. So far, more than 80 companies have joined Paradigm for Parity in that goal. Bickford said some potential metrics include measuring the percent of women attracted, the percent of women retained and the percent of women promoted versus men, as well as the percent of women in the promotion candidate pool. “Establishing a baseline and measuring progress is critical for holding executives accountable,” she said.

Company leaders can adopt Paradigm for Parity’s five-point plan to help move toward gender parity. The steps include minimizing or eliminating unconscious bias; significantly increasing the number of women in senior operating roles; measuring targets at every level and communicating progress and results regularly; basing career progress on business results and performance, not presence; and identifying women of potential and give them sponsors and mentors.

“Unfortunately, far too commonly workplaces are structurally engineered against women,” Bickford said. “The solution is to change the corporate culture to ensure women have equal access to power, opportunity and status.”

Bickford pointed to evidence that links gender-balanced leadership with financial and stock market outperformance. For example, Credit Suisse Research Institute found that companies with 50 percent women in senior operating roles show an average of 19 percent higher return on equity. Further, the Peterson Institute for International Economics found that moving from zero to 30 percent female leaders in companies correlated with a 6 percent increased net revenue margin.

“To change the paradigm so women and men have equal representation, men and women must realize that the solution must be far bigger than just any single individual or single company,” Bickford said. “We need systemic, social change that paves the way for progress.”

Policies Make the Difference

NFP’s Davis said all company policies should be analyzed for flaws and biases that may treat women differently or unintentionally undermine them. Two important policy factors from the Accenture survey are that men and women should be offered and encouraged to take parental leave.

According to an Indeed survey of 1,005 U.S. female workers in the technology industry, 83 percent of respondents said they felt some level of pressure to return to work during their leave. Of those, 38 percent feared losing credibility or value, 34 percent said pressure came directly from colleagues or managers and 32 percent feared losing their jobs. Overall, only 32 percent of respondents labeled their company’s parental leave policies “completely sufficient.” The same survey found that only 49 percent of women feel that both genders are treated equally in the workplace.

In 2015, Facebook began offering four months paid parental leave to full-time employees. Other major companies like Amazon, Netflix, Microsoft and Adobe now have similar policies. And yet, according to data from the U.S. Department of Labor, only 12 percent of private-sector workers are offered paid parental leave.

Another policy factor from the Accenture survey is that the organization clearly states gender pay-gap goals and ambitions. Federal data show that full-time working women earn 80 cents for every dollar men earn. According to an Economic Policy Institute report, in the first four years after college graduation, women earn 86 percent of what men earn. Women Employed’s Majmudar said a ban on salary history questions can help diminish the pay gap throughout a woman’s working life. When salary is based on previous earnings, that means the gap continues to compound and follow women throughout their career, Majmudar said. “It’s unfair, and it just perpetuates the pay discrimination that women experience early in their careers. Any employer should be able to determine how much they’re able and willing to pay, and what the competitive market rates are for that position.”

Seven states currently have bans against asking salary history questions, and many companies ban the question internally. Starbucks Corp., for example, recently announced it reached gender and racial pay equity in the United States. According to a company news release, the effort began in 2008 with a compensation study throughout the company that resulted in tools such as “a calculator to objectively determine target starting pay ranges based on a candidate’s experience.” Raises and bonuses are also statistically analyzed to prevent systemic bias. The company also stopped asking job candidates about their salary history. In addition to Starbucks, companies such as Adobe, Apple, Intel and Salesforce have also reported success in closing the gender pay gap, and more than 50 companies have pledged to do the same.

NFP has also banned asking salary history questions. “It just propagates the pay equality issue from one company to another,” Davis said. Personally, Davis said she’s been offered roles at other companies and found out later that a male employee with the same or even less knowledge and experience had started at substantially higher salaries than she did. To help repair that inequality, “we use pay ranges for a position and base our pay on knowledge and experience of the person, rather than what that person was making before.”

Majmudar echoed that companies should be transparent about employee earnings. “List salary ranges for available positions, either internally or externally,” she said. “Conduct pay audits so that you as an employer can address any inequity that exists just within your organization.”

Majmudar also said employers should have more open conversations about pay and involve women in how pay is set. “A lot of large companies have certainly done that work,” she said. “And there are others, as well, who are taking a look at whether or not their pay is equitable — not just according to gender, but also according to race and any other number of dimensions.”

Ave Rio is an associate editor at Talent Economy. To comment, email editor@talenteconomy.io.