Women are good for business. There should be more of them in finance leadership positions, but the solution isn’t merely to hire a few more female CFOs. It requires a well-considered, long-term strategy, otherwise companies could face expensive legislation to tackle the gender imbalance.
At one extreme lies the quota system. It works fast but is a severely blunt tool. Female job applicants want assurance they will be judged on merit, and men who apply want assurance they won’t be discriminated against even if they merit the job. Quota systems do neither.
But at the other extreme is inaction. Assuming that merit, regardless of gender, will rise naturally is to ignore the effect of generations of under-representation. Ernst & Young estimates it will take 117 years to reach gender parity if we do nothing!
The middle ground involves systematically encouraging women into senior roles, on their own merit. Here are three ways to make a start.
1. Flexible working practices
Flexible working practices encourage more women back into the workplace, allowing for a larger pool of talent from which to recruit senior finance executives. Despite many years of debate and numerous high-profile instances of flexible working, the overwhelming majority of workplaces still equate presence in the office with productivity. But every finance software system worth its salt has a mobile application and, implemented thoughtfully, flexible working has huge benefits. Not only will it encourage a more diverse talent pool, it also encourages satisfaction and retention of all staff, not just women.
But it has to be sincerely implemented. Paying lip service to flexible working while penalising employees who take advantage of it does more harm than good.
Once women have the flexibility to return to or remain in finance roles, a mentoring program should be implemented to encourage personnel development. The dearth of women in senior finance roles becomes a self-limiting factor in the promotion of more female executives. If there are no strong role models, fewer junior employees will aspire to more senior roles, limiting the pool of candidates with merit at the top of the finance food chain.
About half of finance graduates are female. With mentors to guide, and visible career paths within the finance function, more women will progress through the ranks, and their representation will filter upwards to the decision-making finance roles.
In addition, a mentorship programme underscores a company’s commitment to redressing the gender imbalance, which will help shift perceptions and bring about cultural change in an organisation.
3. Eliminating bias
No matter how conscientiously neutral a company aims to be, unconscious gender bias exists in most workplaces and requires concerted efforts to overcome. Bias awareness training is a good place to start because it acknowledges the issue, but companies should also consider changing internal processes to challenge the status quo. Recruitment panels should be diversified, the process of selection should be made as transparent as possible, and appraisal criteria should be examined to ensure that they don’t inadvertently limit promotion of suitable candidates.
These corporate improvements will go some way to redressing the gender imbalance at the top of the finance function. Ultimately though, to see the full benefit of women in senior financial roles, organisational culture has to change.
For example organisations could “promote supportive not competitive cultures – too often a competitive culture results in zero-sum internal politics and wasted energy focusing on peers not customers/suppliers,” according to Martin Willis, a financial controller contributing to the female CFOs debate in the featured discussion on the Modern Finance Forum.
Cultural change is hardest to effect and it has to come from the very top. The C-Suite needs to commit to diversity and be conspicuous in driving it through the entire organisation.