Getting serious - Our experiences in elevating the representation of women in leadership - A letter from business leaders (2011)

Business woman leader photo - cover of Our experiences in elevating the representation of women in leadership publication

Our experiences in elevating the representation of women in leadership

A letter from business leaders


Getting serious

In our companies we see progress from building an understanding of gender diversity and taking the actions described in Phase 1. However, for most of us, these alone do not meet our aspirations. The next transition occurs when we move from an interest in elevating women in leadership, to an understanding that we must actively drive change in the same way that we do for any transformational business imperative.

A company cannot transition to Phase 2 until the CEO has conviction. This increase in commitment makes sense for a variety of reasons. For some of us, there are business grounds for making the next move. Some of us think of it as a moral imperative—we want our daughters to have the same opportunities as our sons.

However, for most it is a fundamental belief that our organisations will be disadvantaged if we do not leverage half of our population. Many of us also believe that a company culture that does not support the advancement of women will be increasingly unattractive to the next generation of talent.

Companies who are further along in the journey have a more penetrating approach to managing the objective. Leadership becomes more driven—there is a transition from asking questions and supporting programs to managing gender balance as a business imperative—alongside other priorities such as customer service, new markets or productivity improvement.

As Exhibit 9 shows, McKinsey’s Women Matter global research finds that having gender diversity as a top strategic priority correlates directly to the actions a company takes on gender diversity, and to the number of women in senior management. This makes sense, but what actions need to be taken?

Essentially, we must eliminate obstacles to merit-based appointments of women. For some, tweaks or targeted interventions are required, so that talent processes can be harnessed to drive change.

In the first phase, HR led the charge with our support. In this second phase the leadership team takes over. The task in the second phase is to provide strong leadership, and where required, intervene to manage the talent pipeline to deliver the best outcomes. People processes must deliver and develop the best people—regardless of gender.

By integrating the goal of elevating women’s representation in leadership into the business agenda, companies move further towards achieving gender balance than by relying on CEO personal interest and programs alone.

Exhibit 9: Having gender diversity on the top of the strategic agenda is critical

 Having gender diversity on the top of the strategic agenda is critical

By ensuring targets are in place, well understood and hardwired into scorecards, senior leaders become good at identifying barriers—and intervening to offset their impact. All of this adds up to improved results against objectives. Exhibit 10 describes how ANZ embeds its gender balance aspiration into its overall strategy.

However, there are risks, namely that the focus on women can be seen as compromising rather than enhancing our talent. ‘It’s important to be clear that my active interest and targets don’t guarantee a woman a job or promotion. What they do is to increase the probability that a talented woman will be considered alongside a talented man’, says Andrew Stevens from IBM.

In this phase, the five most impactful actions are:

1. Make the leadership team the diversity council. With an up shift in commitment, we personally set and monitor progress against our diversity strategy.

Ralph Norris transitioned CBA’s diversity council from people with experience in diversity, to the full executive committee—to better align accountability. In the past, CBA’s diversity council might have provided advice, but no specific action plan. Now, the diversity council ‘owns’ elevating women’s representation in leadership. Meetings that used to be about education are now about decisions and corrective action.

Says Gail Kelly of The Westpac Group, ‘the diversity council is chaired by me and made up of the full executive committee. It needs to be us—we can call each other out and we can hold each other to account. As the council evolves it may expand, but for now we own it.’

Telstra’s diversity council, established in 2006, is chaired by David Thodey and comprises six of his direct reports. This group provides strong strategic oversight and draws connections across the organisation so that diversity and inclusion is business-focused, aligned and deeply connected to customer, community and people outcomes. Council members monitor key metrics and engage local groups to further embed change.

2. Signal change with the appointment of women to key roles. A number of us describe needing to ‘prime the pump’ by making or facilitating key appointments—whilst ensuring the appointments are solid. We all agree this must be done without compromising meritocracy. We do this by becoming more aware of the women around us. We also seek out those we may not have immediate exposure to. Some of us deliberately remove barriers where meritocracy might be failing. Others admit to simple good luck and fortuitous timing.

These appointments signal a new diversity paradigm. At Woolworths, Michael Luscombe’s appointment of two women into line roles in the senior executive team signalled that promotion would not just be given to those with years of technical experience, but that leadership qualities were also critical to selection.

When Stephen Roberts from Citi was looking for someone to join his team, he reached out to a woman he knew who had started her own business. ‘I asked her to tell me all the reasons it wouldn’t work. Then, I told her what I was prepared to do to make it work.’ Eighteen months later, she has been nominated for a significant award by her peers. ‘I often think of the others who are not getting that phone call. What a waste’, says Stephen.

Alan Joyce of Qantas states, ‘it’s often about getting people to consider candidates who aren’t on the radar. That drives the different outcomes.’

3. Shift from ‘diversity maths’ to measuring and managing KPIs. At this point, we understand our ‘diversity maths’ well. From that foundation, we move from a general to a granular view of the opportunities. We set realistic and specific targets for each part of our organisation. We communicate the path to achieving them. Plans are created and measured against. Diversity metrics move from being separate scorecards to being embedded in reviews. Traditional reasoning that diversity results are outside our control becomes unacceptable.

For example, at Citi, a simple, achievable target focused on the CEO’s direct reports worked well. Says Stephen Roberts, ‘We needed a goal that would make a real difference, that was easy to measure, that would build confidence. We also needed to ensure that we provided support for groups who didn’t have a natural pipeline of women ready to take on leadership roles. When provided the support, the knowledge and resources, it was amazing how much progress we made in only a few months.’  This experience is described in Exhibit 11.

Our companies take different approaches to communicating targets. The Westpac Group employed a mix of both internal and external communications to reinforce its commitment. ‘Our partnership with UN Women’s International Women’s Day served to drive momentum internally, to raise the profile of key women in the pipeline, but also to send a very public signal about the level of commitment and our confidence about reaching our goal’, says Gail Kelly.

Some of us fear over-communicating targets or results because it might imply a move away from merit-based appointment—and raise suspicions that women did not ‘earn’ their promotions.

In this phase, companies also move towards considering the quality of the women in the pipeline, not just the quantity. For example, at Woolworths, all talent discussions include consideration of the proportion of female talent in the high potential and promotable pools, as well as in the top 1000.

4. Intervene on talent. We are aware of patterns of hiring and promotions that don’t support our goal of developing the best talent regardless of gender. Many of us report intervening to get the right merit-based outcomes.

We become increasingly aware that our processes overlook talented women, and therefore do not support true meritocracy. We seek out ways to fix this tilted playing field:

(i) Zero-in on top talent pools and high performer programs. Many of us emphasise getting to know the women in our senior talent pools, leading to several key appointments. Many of us are still in the early stages of tracking promotion slates and succession planning to ensure that deserving women are considered.

Some of us have set goals for women representation in talent pools above the current share of roles, to ensure sufficient access to opportunity.

IBM’s leadership program integrates the company’s pipeline management and succession planning process. IBM focuses on promoting women via managing a ‘women ready for promotion’ list. This is consulted when leadership programs become available or new executive roles arise. All executive benches must have at least one female candidate.

Mike Smith and his team at ANZ talk about ‘early and activist career and succession planning to ensure we are creating a strong pipeline for line and business roles’. Women are encouraged to think through their aspirations and the critical experiences they need to achieve their goals. A clear career plan is important for employees with leadership aspirations, particularly those who may take time out.

(ii) Bet more on leadership intrinsics in appointments. Many of us regularly question overly narrow experience requirements that might leave women out. We observe that women’s experience might feel more ‘choppy’ than their male counterparts—due to factors such as parental leave or a limited ability to consider mobility options.

In the Australian Public Service, leaders work to interpret career break experiences, such as leadership of a school’s Parents and Friends Committee, or a pro bono role with the not-for-profit sector, into their evaluation of candidates.

(iii) Transition to sponsorship, not mentorship. Many of us decide that our traditional approaches to mentorship are not enough. We believe we need to provide not just general guidance for women, but also support that helps them get promoted.

Exhibit 10: Embedding the diversity aspiration at ANZ


Previous approach
Current priorities and actions
Governance/strategy
  • HR led
  • Diversity Council of interested leaders
  • Women in management targets
  • Strong and visible CEO and Senior Executive leadership
  • Gender/diversity identified as key differentiator in people strategy
  • Targets are ‘built into’ management board scorecard with regular reporting (at least quarterly)
  • Public targets and reporting
Recruiting
  • General desire for balance in graduate classes, and other entry points
  • Intention to develop more women leaders
  • Limited tracking of gender balance for outside hires
  • Target of 50% representation in graduate intake
    • – Intervention if not on track
    • – Consequences embedded in review process for not achieving
  • Focused action to develop and promote women with clear results
    • – 3 Management Board members
    • – 3 country CEOs
    • – Senior women leading key businesses and operations
  • New expectations for service providers including policy for at least one woman on all recruitment slates with tracking
Learning
  • Women skill building and networks
  • Discrimination/sexual harassment training
  • Capability building focused on building inspiring and inclusive leadership; embedded in core competencies for advancement
  • Targets and tracking of women representation in key leadership programs
Pipeline
  • General understanding of talent pipeline
  • Promotions tracked and monitored as part of diversity strategy
  • Limited reporting or corrective action
  • Target share of women consistent with share of roles
  • Limited opportunities to intervene on exits
  • Targets for key talent and accelerated development programs
  • Detailed understanding of senior women including
    • – Individual, early and activist career and development plans
    • – Succession planning for business critical/line roles
    • – Senior sponsors
    • – Close tracking of retention and promotion rates
  • Commitment to and actions plan to achieve gender pay equity
Retention
  • Gender Action Network
  • Mentoring programs
  • Building vibrant and diverse teams a key element in People strategy
  • Detailed understanding and promotion of the conditions and culture that enable women to advance and succeed
    • – Inclusive and values-based leadership and culture
    • – Flexibility and support through career cycles
    • – Gender education and awareness sessions for all senior leaders
  • Commitment to advancement of women in society through financial capability and employment programs.

Exhibit 11: Target setting: learnings from Citi


From July 2010
To July 2011
Goal characteristics
  • General, company-wide aspiration
  • Difficult to measure
  • Simple, achievable and specific goal
  • Focused on direct reports of CEO
  • Easy to measure
Words used
  • ‘Create an inclusive workplace through actively demonstrating commitment to the attraction, retention and development of a diverse talent pool’
  • ‘Hiring a minimum of one senior woman into an approved, open role’
Communications
  • Focused on inclusiveness and being ‘the right thing to do’
  • Leaders asked to cascade goal to overall organisation
  • Highlighting business case, including reporting requirements, and current external climate of quotas
  • Communication of impact on key metrics
  • CEO spoke personally to all direct reports about goal
Accountability and support
  • Very difficult to measure
  • Unclear consequences for achieving
  • No specific support offered
  • Simple to measure
  • Embedded in direct reports performance review
  • Search firms hired to support ‘hard to crack’ groups
  • If goal not achieved, reasons to be shared with senior management team, diversity council
Impact: 9% increase in women in top 2 levels (from CEO)
  • More than 75% of groups achieved their goal early
  • Others are on track, and have clear plans to meet aspiration
  • Increased confidence and appetite for further increases
Lessons learned: General goal does not work, better to have:
  • Focused audience
  • Easy to measure target
  • Support mechanisms where needed

Exhibit 12: Sponsorship at Goldman Sachs

Context and Objectives
Leaders were disappointed with the promotion rates of senior women, which lagged rates of their male counterparts. Many women were seen as having a lower profile than their male counterparts. They also had fewer advocates on average from outside the business.
Goldman Sachs in Australia is working to close this gap, through a formal sponsorship program for senior women. The firm has already experienced a successful rollout of the program in Asia.
Actions Taken
  • Executive Directors assigned two Managing Director sponsors
  • Sponsors required to provide coaching focusing on impact, profile and platform
  • Feedback sought from sponsors regarding candidates’ responsiveness to feedback and their suitability for promotion  
Lessons Learned
  • In the first year, Goldman Sachs in Asia promoted the highest percentage of women to Managing Director
  • Promotions continue to be strictly merit-based, but the program helps close the ‘profile’ gap between the functional contribution high potential women make and broader recognition and visibility in the organisation
  • Sponsorship programs provide leaders exposure to women that they might not have otherwise met and in some cases builds their own leadership skills

Exhibit 13: NAB Diversity and Inclusion Service Provider Principles

Summary of expectations for search and recruiting firms
Supporting NAB’s aspirations
Service providers will:
  • Be true partners in supporting NAB’s aspirations by
    • – Providing a written strategy to improve their own diversity in terms of gender, age, work flexibility, ethnicity, disability, sexual orientation, etc.
    • – Reporting on gender diversity in their own organisations across all levels and any targets in place
  • Providing evidence that they are able to support NAB’s diversity aspiration by utilising
    • – Inclusive language and imagery
    • – Channels that target diverse labour pools
    • – Validated short-listing processes that weed out biases
    • – Objective interview processes
  • Employ a robust approach to training recruitment consultants on diversity and inclusion, cultural awareness, non-English speaking background, bias in selection, EEO and anti-discrimination. This includes training provided to consultants on the service provider’s diversity policy, NAB’s Diversity and Inclusion Policy and unconscious bias
Metrics to track success
Service providers must also provide progress updates, including KPIs to NAB on a quarterly basis that cover:
  • Gender metrics for all roles (successfully filled or not) which include the gender ratio for each phase of the process including
    • – Initial pool of candidates
    • – Selected for Interview
    • – Shortlist provided to NAB
    • – Selected to interview by NAB
In addition, shortlists for senior management roles must include at least one woman of sufficient quality/suitability recommended for interview. If such a candidate is not presented, a written explanation is required each time

For example, McKinsey & Company interviews with over 100 remarkable women leaders globally found that for many female leaders there was a key individual who believed in them. This sponsor shaped their professional destiny by pushing them hard, opening the right doors, and giving them honest feedback when they were veering off track. These efforts went well beyond ordinary mentoring relationships—sponsors stuck their necks out, they looked for and created opportunities for these women because they wanted their protégées to succeed.

Many of us also believe that sponsorship is particularly important in the first 3-5 years of a woman’s career, not just when they are close to achieving a senior role. Sponsorship during these early years where expectations are being set—both the organisation’s and the woman’s—can make a difference in their early trajectory, and in the likelihood that they will strive for senior roles later on.

At ANZ, this means building the expectation that sponsorship is a key role of senior leaders and emphasising its importance for women. All executive teams are expected to know the women in their divisions who are part of talent and graduates programs. Leaders are encouraged to engage and sponsor women through meaningful work experiences, by identifying and building career paths, and through regular people planning processes.

As Exhibit 12 shows, Goldman Sachs is rolling out a program that holds senior executives responsible for the success of specific women. ‘Sponsorship is about moving from coffee chats and advice, to actually backing our women, and feeling responsible for their career success. It’s a real mindset shift’, says Stephen Fitzgerald.

Andrew Stevens of IBM spoke at and attended various activities over three days of the company’s women’s leadership training earlier this year, ‘It was deeply satisfying. Fifteen of the eighteen senior women attending have had real breakthroughs since then. Many have said my attendance helped. It also allowed me to get in touch with, and to some extent, remove, barriers. It also sent a message about just how important elevating women’s leadership is to me.’

Exhibit 14: Telstra’s female employment brand

Diagram - Telstra’s female employment brand

(iv) Ensure your attraction engine is delivering. Some of our companies are working to increase the number of women brought in through external appointments, especially into areas that are particularly male dominated. As we focus on women talent, our search partners need to as well. Most of us are now insisting on women candidates for all senior external searches, where in the past, it was common for none to be presented at all.

For example, NAB has introduced Diversity and Inclusion Service Provider Principles that apply from 2012. These principles, outlined in Exhibit 13, require recruitment partners to provide information regarding their diversity strategy. Areas to be covered include strategic actions, training and processes that will achieve the supplier’s stated diversity strategy. Reporting on the gender ratio along each step of the recruiting process must also be submitted, including the initial pool of candidates, screening, selection, and short-listing for all roles. There is also a requirement that at least one woman of sufficient quality will be recommended for interview.

Many of us are re-thinking our own recruiting strategy, in the hopes of attracting more women at all levels. Exhibit 14 describes Telstra’s recent efforts to improve its recruiting approach, which resulted in the creation of a segmented employment brand for women. This approach has more than doubled applications within targeted areas, in the first three months of its implementation.

Citi is taking an innovative approach to leveraging its networks to attract women, including former employees of the company. Senior leaders, particularly women, are regularly asked to provide referrals from their networks.

In addition, a new program planned for launch focuses on engaging with Citi alumni. Alumni will receive regular updates from leaders on knowledge, new developments and opportunities at Citi. While the mission is broader than recruiting, there is a belief that staying in touch with former employees, many of whom are on extended career breaks, will be a powerful tool for attracting new employees or referrals, particularly from women.

5. Surface barriers and biases. During this phase, we work to surface, rather than drive underground, the fears, mindsets and behaviours that work against reaching our aspiration. We might do this through surveys and focus groups, and through individual conversations. It is important to get a sense of things that stand in the way of meeting our goals.

Treating diversity on par with other business objectives makes a significant difference and allows opportunity for real action. In this phase, we are getting good at identifying barriers and intervening to offset their impact.

For most of us, in this second phase we still see obstacles to reaching our ultimate objective—an environment where supporting gender diversity is ingrained within the very culture of our business.

Questions we would encourage you to think about:

How do you signal the importance of this issue to your organisation in the way you commit your time, and in the conversations you have?

Do high potential women inside your organisation or currently on career breaks have real sponsors?

Can you identify the top three priority areas where you and your top team need to personally intervene?

 

‘Our strategy is to stay ahead of the curve on talent, by building a culture that is truly inclusive. I tell people that we shouldn’t rest until we reach census levels–50/50. When I see hesitation or resistance, I know I’m onto something. I find it energising!’
Andrew Stevens, IBM

‘The success of our strategy depends on having a vibrant workforce, with people who understand and can connect with our customers and markets wherever we operate. With more women in our leadership pipeline and senior executive ranks, we are tapping into a much broader range of leadership styles, experiences and skills to manage our business and achieve our goals.’
Mike Smith, ANZ

‘Qantas is an iconic brand. It’s about the legacy you leave and diversity is a key part of that. This covers gender, indigenous, disability, age, sexual orientation. If I do it right, Qantas will be much more rounded, more representative for a national icon and much stronger for the next 90 years. If I leave with the right diversity in place, then it’s a job well done.’
Alan Joyce, Qantas

‘The key to changing behaviours has been our consistent focus across multiple generations of the APS. There is now a groundswell of people leaving a legacy. Its become part of our culture and now, is just the way we do business.’
Annwyn Godwin, Merit Protection Commissioner, Australian Public Service Commission

‘We know that a diverse workforce creates value and we need to ensure we reflect the customers and communities we work with. NAB sees our focus on the advancement of women as a never ending journey. Early progress has been pleasing, however, we need to ensure we stay the course.’
Cameron Clyne, NAB

‘Success is about sustainable gender diversity, not just a few key roles filled at a moment in time.’
Sue Morphet, Pacific Brands

‘For me, this is all about, how we build great leaders. It’s a broader shift. How do people lead other people? How do you work with each individual to make them successful? How do you create an environment which is inclusive, where everyone can perform to their potential? That’s why this is so important.’
David Thodey, Telstra

‘We need to make leadership appointments, not technical ones. It will require focus, but it’s absolutely the right thing to do for the business. Our culture and performance will be all the better for it.’
Grant O’Brien, Woolworths

‘We’ve been focused on building a strong inclusive culture for many years now to ensure that we can attract and motivate the best talent possible, regardless of gender, ethnicity, religion or sexual preference. This requires the courage to try new things and challenge long held mindsets and unconscious bias. It also requires unwavering commitment.’
Ian Narev, CBA