Conversations about quotas to increase the number of senior women in business seem unreal. It is as if instead of living in contemporary Australia, we have stepped through that mirror with Alice, and are making our way through Looking Glass Land, talking nonsense.
Given the utter unlikelihood of any Australian government imposing quotas, why are we even having the conversation?
Maybe it is guilt, or at least discomfiture about the continuing low numbers of women on boards and in executive ranks of leading companies. In late 2012, women made up 15.4% of the non-executive directors of the ASX200 companies and held just 9.2% of executive positions in the top 500 companies.
Worse, according to Workforce Gender Equality Agency, there had been “a decade of negligible change for females in executive ranks”.
A Bain & Co report presented in early February 2013 to a business breakfast in Sydney hosted by Chief Executive Women similarly showed no increase in the numbers of female senior executives in major Australian companies in a decade. “Short of some bold actions,” the report commented, “it will be many more decades before the representation of women in leadership comes anywhere close to achieving a critical mass, let alone equalling that of men.”
The situation is not just bad, it is diabolical. Enough to embarrass even the most dedicated misogynist.
Yet when during discussion after the breakfast presentation of these figures, investment banker and company director Peter Hunt intervened calling for the Corporations Act to be amended to require a quota of at least quarter of women on company boards, there was widespread disagreement.
Hunt received a hiding in the media the next day. In the Australian Financial Review, Tony Boyd accused him of ignoring “some compelling evidence from Norway”.
Boyd argued in his Chanticleer column that the law in Norway, requiring companies to appoint 40% women to the boards of listed companies, had been a failure because “there was little if any change in the number of women in senior executive ranks”. Female representation at senior management remained “stuck at about 10%”, Boyd wrote, arguing that “this showed that board-level compliance with quotas was not enough to change the culture of companies or the deeply entrenched male biases in the hiring and promotion of women.”
As the Norwegian law applied only to boards, this is not surprising. If more women on boards is going to lead to more women being appointed to senior management, it is going to take a lot more time than is required simply to tap a woman on the shoulder and offer her a directorship. Executive jobs usually require industry-specific skills and experience and these take time to acquire.
What Boyd does not want to concede is that quotas work. The percentage of women on boards in Norway rose from 7% in 2003 to 39% in 2009. Norway’s top 500 companies very quickly managed to find enough women to meet the quota. Although they had ignored the law during its first two-year voluntary compliance phase; the threat of de-listing for non-compliance forced them to take it seriously. The Norwegian law achieved exactly what it was intended to do: it increased the numbers of women on boards.
Given that there is supposedly widespread agreement in Australia that there should be more women on boards, why are we so opposed to quotas? If something works, shouldn’t we embrace it? And shouldn’t women, especially, be clamouring for such a remedy to their current exclusion?
Instead, many women maintain they would rather miss out than benefit from quotas. There is even a new group, Financial Executive Women, set up in early 2013 as an “invitation-only networking group for women” which is “staunchly” against quotas. The group’s objective is to have women appointed to leadership positions because “they’re the best person for the role, not because they’re needed to fill a quota.”
This just shows how thoroughly many women have been brain-washed into perpetuating the system which shows no sign of allowing women to achieve critical mass, let alone equality for “many more decades”. Not in the working lifetime of any of these women.
Do we think for one second that if there were an equivalent tool offered that would enable men to get jobs, promotion, raises and generally be top dogs, that they wouldn’t grab it with both hands? Do women think men worry about what other people think about the tactics they use to get ahead? Such opposition to quotas is stark confirmation of women’s passivity and their blind belief that if only they network, or mentor, or try harder, or look better they will get the job, the promotion or the pay raise. If they are good little girls, they will be rewarded. This is despite the evidence of the past few decades and despite what Tony Boyd called “the deeply entrenched male biases in the hiring and promotion of women”.
Making nice will not make these biases go away. As we have seen, no change in the numbers in ten years and no change in prospect. What kind of wake-up call do women need?
The system that excludes women has successfully constructed a self-preserving and reinforcing ideology, which I call the misogyny factor. In this instance, the rationale is that there is a conflict between quotas and merit. In fact, as Sex Discrimination Commissioner Elizabeth Broderick has persuasively argued, the merit principle “is intended to eliminate favouritism, nepotism and bias – and yes sexism…”
Instead, it is being used to justify women being passed over. You supposedly can’t argue with ‘merit’ because it is self-evidently an objective criterion, yet this is patently not the fact. It is simply not credible that, after more than three decades of women entering and graduating from universities in equal or greater numbers than men, that the distribution of merit in this country is so skewed in favour of men. The statistics on women’s representation in leadership highlight the persistent bias against women that gives lie to the notion that ‘merit’ has been a factor in selecting people for these positions. ‘Merit’ is the fig leaf that, very inadequately, tries to cover the shame of modern-day discrimination against women.
This is also evident when we look at federal politics, where the Australian Labor Party has an affirmative action policy – a quota – to ensure that 40% of its representation is female, while the Liberal Party does not.
“Every woman on our side of politics has been selected on merit,” deputy leader of the federal opposition, Julie Bishop, said in an interview with Mamamia in November 2012. There are just nineteen women in Bishop’s Liberal Party in federal Parliament (21.8% of the total), compared with thirty-eight women in the ALP (just short of the 40%. Is Bishop seriously saying that there are fewer women of merit in the Liberal Party? Or is she just unwilling to acknowledge the blocks that stand in the way of women being preselected for safe or winnable seats for the Liberals – that could be circumvented with a quota?
As Elizabeth Broderick has argued, “Quotas are one way of bringing women’s merit out into the open.” By having a quota, the recruiter is obliged to consider a wider field than might otherwise be their natural inclination. This does not mean that people – women – are selected who are patently unqualified for the position; it merely means that there is a mechanism for them to be considered. Without the quota, there is no mechanism – no pressure to change. It is quite absurd when everything else in business is planned and measured that there is such reluctance to do so when it comes to the hiring of women.
The opposition to using this tool, to achieve an objective that everyone claims to want, is irrational and suggests the support for the objective is insincere. Such opposition would be better seen for what it is: a flat out refusal to adopt a measure that would deliver improved representation of women, because business does not want it, and does not acknowledge the economic value that would accrue from a more representative workforce.
Unless, of course, companies adopt quotas. A number do so, as they know it is the only thing that works. They do not use the Q-word: the preferred term is ‘target’. Large companies such as Qantas, Telstra, Westpac and IBM all have publicly disclosed targets. But when the target to say, bring more women into senior management, is set at 40% or even 50% and has a timeframe attached to it, isn’t it a quota by another name?
The key differences are that they have been voluntarily adopted, rather than legislated, and that they are being used to improve numbers of women in executive positions, rather than on boards. Because they are voluntary, the issue of penalties for not reaching the targets will be an internal corporate matter. Whether CEOs are held accountable by their boards for reaching these targets remains to be seen. It is going to be interesting to observe over the next few years whether the numbers improve sufficiently to suggest that the targets have real force.
They will be able to be tracked because of the new ASX corporate governance reporting guidelines requiring all listed companies to include in their annual reports information about their diversity plan and report on the gender breakdown of staff, senior management and board. Over time it will be possible to track these numbers.
Given these measures are in place, why does the issue of quotas keep being raised in business forums such as the breakfast hosted by female chief executives? Does this indicate scepticism by business about the effectiveness of the voluntary measures? And why, given that there is no possibility either major party will legislate quotas, does business pretend this is a (threatening) possibility?
There is not even a remote chance that the Gillard government will introduce quotas. If it were to do so, it had its chance with the Workplace Gender Equality Act, enacted late in 2012. Instead quotas were not considered even for one second, and the government went out of its way to accommodate business pressure to water down already fairly weak legislation.
Under a reporting regime that is not due to be fully operational until 2015, companies employing more than a hundred people will be required to inform the government of the gender breakdown of staff and boards, report on remuneration by gender and the flexible work arrangements available, as well as informing government of the consultative mechanisms with employees about gender equality in the workplace. The consequences for non-compliance remain the same as in the Howard-era legislation: companies can be named in Parliament, and non-compliant companies ‘may’ be prohibited from tendering for certain government contracts or receiving certain forms of government assistance. Over the past decade or so, several companies have been named year after year for non-compliance, usually for failing even to lodge their reports, with no apparent deterrent impact on their conduct. I have not been able to find a single instance of the contract compliance provisions being applied.
Business need not fear that the Gillard government is going to force it to hire more women although the Prime Minister seemed to send a different signal when she addressed the Business Council of Australia dinner in Sydney on 15 November 2012. She spelled out some of the policy things her government was “doing for women'” and made the following, astonishing comment: “I’m looking forward to seeing [gender equality] flow from the shop floor to the leadership level, where I’m sure that in a couple of years’ time I won’t still find myself meeting with boards where the only other woman is serving food.” Julia Gillard seemed to be telling business that she was ready to compel them to hire more women if they failed to take action themselves. She will need to win the next election for us to know if that was what she was really saying.
On the other side of politics, despite a few rumblings from Shadow Treasurer Joe Hockey that quotas should be considered “as a last resort”, it is inconceivable that an Abbott government would legislate to mandate participation by senior women in a significant way. If he wins the 2013 election, Tony Abbott will be flat out getting the business sector to accept a 1.5% levy to pay for his proposed parental leave scheme. Three thousand companies are likely to have to pay this extra tax, so it is stretching the bounds of credibility to think Abbott would add a further requirement.
Yet, every time another bad set of numbers is revealed, the Q-word is raised. It’s as if there is an acknowledgement, deep down, that nothing is really going to change until there is concerted, planned action with penalties for non-compliance.
There is sweet optimism implicit in this thinking, suggesting we will get there in the end. Nothing that has happened over the past few decades justifies such optimism. The market has failed. Voluntary measures have not proven to be effective. But if it takes fear to force change, let’s keep talking about quotas.
This is an edited extract from an essay which first appeared in the Griffith Review’s Women & Power.
References available at www.griffithreview.com