Missed opportunities for Australian business

This is a timely article about the missed opportunities for Australian business.

The story highlighted that the executive ranks of the nation’s top 200 companies have, in effect, become a men’s club, with just 10% of management jobs being held by women. This means that corporations are not making effective use of the nation’s talent pool because half of our university graduates are women!

Looking ahead, smart companies will recognise that our nation’s ageing population and shrinking workforce will necessitate much better outcomes on the recruitment and retention of well-educated women. The companies that are successful on this front and retain a higher percentage of women managers will be advantaged, because their greater skills retention will translate into a competitive advantage in the marketplace.

The challenge then is to how hasten the process of boosting the number of women in executive ranks.

I don’t believe the introduction of quotas is the best means to achieve this. An initiative to artificially set a quota for the number of women executives is very much a ‘last resort’ because it will be divisive and build resentment towards women selected for executive roles. This will only make it harder for those women chosen for an executive role to make a success of their new position.

A survey on ‘Retaining Women in the Workforce’ conducted by the Australian Institute of Management late last year showed that male and female managers believed the major impediment to retaining women executives was inflexible working arrangements. Other impediments included childcare support, paid maternity leave and pay equity.

Rather than impose quotas, what’s required is a solution that speeds up the marketplace adjustment to the problems caused by our ageing population. In this regard, there is an opportunity for the Australian Government to build on the leadership it has shown in initiating the inquiry into pay equity and increasing female participation in the workforce.

A way in which this could be addressed is the establishment of a small Government owned company – operating at arm’s length from Government with an independent Board of Directors and a business-savvy executive team – to connect with industry on how to overcome the problems of poor female participation in executive ranks.

The research work of the EOWA has succeeded in identifying the poor record of corporate Australia in the promotion and retention of female executives. However, a public service based organisation like the EOWA is simply not best equipped to engage with industry on solving the problems their research has identified.

A business-savvy company established with the strong support of the Prime Minister and Government ministers should act as a catalyst for change on the retention of women executives by building effective links to industry. These links would achieve recognition by industry that a problem exists, the opportunities that are available and set the pathways for companies to follow. In that way, we can boost the number of female executives and build our nation’s skills base at the same time – important achievements for a country with an ageing workforce. By so doing, we will achieve the best outcome for Australia’s long-term economic future.

Susan Heron, CEO of the Australian Institute of Management, Victoria/Tas.