Pledging for Parity – and why it pays

International Women’s Day was born out of a workplace dispute 108 years ago, so it’s only appropriate that the workplace continues to occupy a central position in the annual call to action for gender parity on March 8th.

But before we delve into the latest facts and figures around gender equity at work, consider the following intriguing finding from a study conducted last year by the Heritage Bank.

The 2015 Australian Pocket Money Survey found that, on average, Australian girls earn an allowance of $9.60 a week from their parents. The boys, meanwhile, are raking in $13.00.

That’s a gender pay gap a tick over 26% – and the kids are still years away from their first job interview.

It’s a figure not too dissimilar to one reported last November by the Workplace Gender Equality Agency (WGEA) in its gender equality scorecard: the full-time total remuneration pay gap in favour of men in Australia stands at 24%.

Then consider the work of business psychologists The Mind Group, who recently asked 100 working Australians (split 50-50 on gender): “Please could you picture in your mind an Australian Corporate CEO; What do they look like?”

Their response was startling to say the least: 97% described a white, middle-aged man. The three participants who pictured a female CEO were female themselves and had worked closely with a female CEO or executive.

So as we turn to the records of Australia’s bosses, one thing is already abundantly clear: we all need to be asking ourselves questions about progress towards gender parity.

Numerous organisations have used International Women’s Day to deliver the findings of research into both the gender pay gap and the under-representation of women at the top levels of business management.

A comprehensive Roy Morgan poll delivered the good news that the proportion of Australian women at work grew from 52.5% to 54.5% in the 12 months to January 2016, fairly evenly split between full-time and part-time employment. This compares to 65.6% of men.

Across several categories of jobs, however, substantial pay gaps exist. For example, among those classed as ‘professionals’ significantly more men are earning salaries at the higher end of the six-figure realm, while that trend is reversed in the lower salary bands (under $70,000), where women feature more prominently.

Appropriately enough, the WGEA grabbed some of the biggest headlines on March 8. Its latest report, co-authored by the BankWest Curtin Economics Centre, found that women in key management positions are paid on average $100,000 less than their male counterparts – and the higher the level of management, the greater the gap becomes.

The study also delivered some interesting findings on the high-profile issue of female representation on boards. Performance on this score differs markedly between industry sectors, but overall 37% of organisations reported no female representation on their governance boards at all.

Tellingly, however, the research found that greater female board participation resulted in smaller differences in levels of pay – specifically, increasing the number of women on company boards from zero to 50% is associated with a 6.3% decrease in gender pay gaps.

While the authors can only speculate about potential reasons for this trend, researchers from La Trobe University might have a useful suggestion: these companies have more profits to play with.

Examining the performance of the top 500 ASX-listed companies on a yearly basis from 2005 to 2011, the La Trobe study found a positive and significant association between female non-executives on boards and firm financial performance.

What’s more, report co-author Professor Paul Mather said there was a causal relationship. “Board diversity is affecting performance, it’s not that better performing firms are recruiting more women,” he said.

This is not an isolated finding either: last year, the Centre for Gender Economics reported that companies with at least 25% female representation on their boards perform 7% better than those with men only (there are 34 such all-bloke boards on the ASX 200), and 2% better than those that are male-dominated.

Given the extent of the budget surplus facing his Government, the Prime Minister would seem to have made a savvy move on March 8 by announcing the target for women holding federal government board positions will rise from 40% to 50%.

The International Women’s Day #PledgeForParity campaign gives everyone the opportunity to make a similar concrete step to hasten the journey towards gender parity – a journey the World Economic Forum has suggested will take another 118 years at its current global pace.

Perhaps you could start by undertaking a pay gap analysis at your own business. Hopefully you don’t need to take a further step back and re-evaluate your methods of sharing the pocket money out between the kids…

Has your organisation made a #PledgeForParity this year? Why not share the details below.

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Graham Turner is the former Editor of Ai Group's Industry magazine, which ceased publication in 2014. He now edits (and moderates) this Blog, together with Ai Group's weekly Email newsletter.

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