The Competitiveness Picture

11 October  2007

Does it matter whether more women make it into the upper echelons of the world’s top companies? This was the key question in the debate about competitiveness in business. Perhaps unsurprisingly, the answer from all members of the panel was a resounding ‘yes’. But it was an answer based as much on hard-nosed business reasoning as on a nobler, but on the face of it, less economically tangible desire to encourage greater workplace equality between the sexes.

Companies with more women in the boardrooms are better companies. Their results are statistically better and they consequently generate more wealth. Citing one recent study by Goldman Sachs, moderator Alison Maitland argued that if men and women achieved workplace parity in the USA, that country’s GDP could grow by an impressive nine percent.  The figure for the European Union’s Eurozone was even better at 13 percent while Japan could achieve 16 percent GDP growth.

Sandrine Devillard of Mckinsey and Company then presented a major new report by her firm called ‘Women Matter’. With the aid of a video that included interviews with top European business leaders, a European Commissioner and Latvia’s former woman President Vaira Vīķe-Freiberga, Devillard highlighted the main conclusions of the study.

The report brought forward three key findings. The first was that increasing women’s employment levels would help deal with the labour shortage already threatening many developed nations and which, with an ageing population, is set to get worse. Secondly, firms with women in the boardroom perform better. And, third and perhaps most importantly, they tend to make more money than competitors without a healthy gender balance. “More women at the top goes with better organisation,” she said.

She added that McKinsey’s studies also showed that a firm needed at least three women in the boardroom before the effect of a more balanced top level management team would be felt.

Laura Liswood, a senior advisor with Goldman, Sachs & Co., agreed that increasing women’s participation in the marketplace was one of the best ways of dealing with the ever increasing labour shortage. “You can ask people to retire later. You can increase immigration beyond politically acceptable levels or you can increase the number of women in the workforce,” she said, adding that in her view, it was blatantly obvious which was the most preferable of the three options, and it wasn’t either of the first two.

She debunked what she saw as the myth of the ‘glass ceiling’ that prevents women from progressing beyond a certain point along their career paths. “I don’t believe there is a glass ceiling. There’s just a very thick layer of men,” she said.

Meanwhile, Ting Liu, Chair and President of Asia Link Group, explained that China faced some very specific demographic issues when it came to the promotion of female executives. As a result of the country’s well documented ‘one child’ policy there are now around 120 girls in China for every 100 boys.

This is because the authorities decided to relax the population control measure in rural areas and allow couples who had a girl as their first child, to try again for a second pregnancy. In traditional Chinese society, families still placed great importance on having a son, she said.

This reality meant that the gender balance in many Chinese companies was relatively good, especially when it came to entry-level recruitment. Nevertheless she said women still needed encouragement in the Chinese business environment and not least from other women. “It is very important for women to help each other,” she said.

As the only man on the panel, Olivier Barberot, the Senior Vice President of  Human Resources, for Orange, France Telecom’s mobile telephone, internet and television arm, explained that his company tried to be pro-active when recruiting and promoting women.

“I don’t believe in quotas and I don’t think we need legislation on this but it is important to try to encourage women employees with pro-active measures,” he said.

He also objected to the suggestion that men in some way enjoyed working practices that prevented them from striking a healthy work-life balance. “Men don’t like meetings to be at night any more than women do,” he said.

In conclusion, all panellists agreed on the importance of putting into place clear mechanisms to measure how well women were making it into senior positions compared to men, so that accurate data existed. “What gets measured gets done,” said Devillard.