Australasian Science: Australia's authority on science since 1938

Changing the Way We Do Things

By Kathryn Fagg

We need to have a critical mass of women in key roles.

As we seek to increase gender diversity and create more opportunities for talented women, we need to be aware that we are looking to change the way things are done, which can be uncomfortable.

We want to create a better society for Australians, and that means we have to draw on all the talent that is available, both men and women, but be respectful and consider others’ views as we seek to bring about change. We will have a better society when we fully draw on the talent of all of our people.

We also need to recognise where there has been success, and that’s reflected in the increasing number of women on boards and the surge among younger women choosing to study engineering. Leadership has been the key in both cases.

The proportion of women board members in the ASX200 is now at 25%, compared with just 8% back in 2008, which was when there was a wake-up call that something needed to be done as the representation of women actually went backwards.

The 30% Club, supported by the Australian Institute of Company Directors, targets 30% of the ASX200 board members being women by 2018. The appointment rate of women to ASX200 boards was running at 40% in 2016 – the run rate required to achieve the 2018 target.

In the engineering area there is strong leadership evident. At The University of Queensland, 22.9% of its undergraduate engineering students were female in 2016 – well above the 2015 national average of 17%. The University targets 30% female participation in its undergraduate engineering programs by 2023.

The University of NSW has reported that it offered a record number of engineering places to female students this year. One in four engineering offers went to female school-leavers. UNSW Engineering targets 30% by the end of the decade.

It is terrific to see the progress being made on the board front, but the much greater challenge is increasing the number of women in the most senior executive roles as these have the most influence and decision-making power in organisations. We need more women in roles such as Chief Executive Officer (CEO), Chief Financial Officer (CFO) and heads of business units.

In late 2016 I became President of Chief Executive Women (CEW), which represents more than 400 of Australia’s most senior women from the corporate, public, academic and not-for-profit sectors. The organisation’s mission is “women leaders enabling women leaders”.

As CEW’s President, I have set myself the goal of having an impact on the rate of appointment of women to the most senior executive roles in organisations, and not just appointment to senior support roles. Everyone in organisations knows which roles are the most important. We need to have a critical mass of women in them.

Once again the key is going to be leadership. Although there are no silver bullets, we know what is required. Leaders must be able to communicate a compelling case for change, to build a top team with gender diversity, to play a strong role in key recruitment and promotion decisions, to set challenging targets, and to act as a sponsor for talented women and men.

Often a discussion around sponsorship leads to a question of whether it is consistent with concepts of merit and meritocracy. The answer is that merit should be the basis for appointments, but sponsorship can help ensure that the right people are considered.

It is also important to recognise that great care needs to be taken when looking at “merit”. Last year, CEW along with the Male Champions of Change released a report on avoiding the “merit trap”, because organisations that pride themselves on being a meritocracy can be at greater risk of their judgements and actions being biased. In particular, it is critical to look at both performance and potential when considering candidates for appointment. We also need to be careful to avoid defining “merit” as “people like us”.

One of the challenges for organisations is to look beyond individual merit and consider institutional merit. One of my favourite quotes on the topic comes from Lieutenant General Angus Campbell, Chief of Army, who reflects on the difference between individual merit and institutional merit:

Institutional merit is not the same as individual merit. If you choose a senior executive team based only on individual merit, you get a monologue. Institutional merit creates a strong diverse Army, not a strong list of individuals.

Focusing on institutional merit is a key to the quest for greater diversity.

Kathryn Fagg FTSE is a Director of the Reserve Bank of Australia and ASX-listed companies Boral, Djerriwarrh Investments and Incitec Pivot. She chairs the Academy’s Industry and Innovation Forum.