January 23, 2017    4 minute read

Will Boardroom Gender Balance Improve in 2017?

The Path to Parity    January 23, 2017    4 minute read

Will Boardroom Gender Balance Improve in 2017?

Despite increasingly vocal pressure from many sources to address the global workplace gender gap, 2016 compounded its status as a testing year in business by returning an overall slowdown in the march towards equality, according to an end-of-year report from the World Economic Forum.

Dashed Hopes

Disparities in salary and stagnant labour force participation rates continue to be responsible for much of the imbalance. However, as the report also states, one key area widely tipped for rapid improvement over the past couple of years stagnated in 2016:

“The number of women in senior positions also remains stubbornly low, with only four countries in the world having equal numbers of male and female legislators, senior officials and managers, despite the fact that 95 countries now have as many – if not more – women educated at university level.”

This finding is especially disappointing given the general air of optimism that began to emerge around 2012-2013. Hopes for an impending paradigm shift were built on two important observations: first , that digital technologies were encouraging a shift towards more flexible interpretations of standard working hours; and secondly, that customers in an increasingly dehumanised (i.e. online) marketplace had begun to place more value on the sorts of support, detail-orientated and problem-solving interactions typically seen as core strengths of female, rather than male, skill sets and roles.

This latter point was alluded to repeatedly in the UK press following the demise of household name British corporations like Austin Reed and BHS, both of which were accused of having fallen out of step at director level with their modern, largely female customer bases.

A Long Way to Go?

And yet, contrary to this apparently sunny outlook for the chances of increased executive gender balance, newly compiled research into 2016’s top ten Fortune 500 companies upholds the World Economic Forum view that male-dominated boards remain very much the norm.

Displayed as a series of infographics, the data clearly shows that, even for globe-straddling corporate giants like Apple, ExxonMobil and Walmart, women almost always account for less than 20% of directorships, and in some especially noteworthy cases, barely number one in ten. Again, this is despite the fact that in most developed nations, women continue to graduate at a significantly higher rate than their male peers (currently at a ratio of 3:2 in the US).

20% of major-company directorships are female

Moreover, it is almost universally acknowledged within the sector that a more representative gender balance at the upper echelons is typically good for business. Indeed, last year’s large-scale survey led by the global Women In Retail group and UK management consultancy firm Elixirr returned a 100% response rate backing this claim – of the 70 top-level executives (male and female) interviewed, every respondent agreed that full gender diversity all the way up the corporate ladder would be likely to result in improved market performance. 

Interestingly, only 25% of those same respondents felt that their own companies were currently doing enough to achieve a better balance among the directorship. Another widely circulated 2016 report – this time on gender bias in the tech industry – by Computer Weekly magazine found that diversity “drives greater success than individual ability does: according to McKinsey research from last year, companies that are more gender diverse are 15% more likely to outperform others”.

The Path Ahead

So, will 2017 be the year in which this apparent increasing awareness finally kick-starts some less sluggish progress? The only practical answer is, of course, that we will have to wait and see; it may only be January, but the early signs suggest a fairly mixed prognosis.

On one hand, it has now been confirmed that last year was an excellent one for women-led startups, which claimed a larger market share than ever before. On the other hand, the latest blocking of a parliamentary bill in Sweden – traditionally seen, along with its Scandinavian neighbours, as something of a pioneer with regards to improved workplace equality and diversity – has already resulted in the failure of a proposed equality law that sought to impose gender quotas on the directorships of its national corporations.

It seems the struggle is set to continue for some time yet. But 2017 may well see the issue of boardroom gender balance come to a head on a more global stage than ever before.

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