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Saturday, July 13, 2024

How gender equity affects the bottom line

"Time for corporations to step up."

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by Rozl Bautista
People Relations Leader, Asia, 3M

The case for gender equity in the workplace goes beyond ethics and vanity metrics. It is a business one, and the numbers say it all.

A 2019 McKinsey study found that females in top leadership can increase company profits and share performance by as much as 50 percent. Development Dimensions International also reported that organizations with above-average diversity were eight times more likely to be in the top 10 percent of financial performers.

In the Philippines, a 10-percent increase in women at board level would bring a 2.0-percent increase in Return on Assets. While the country holds the highest percentage in Southeast Asia of women in senior management roles at 32.8 percent, only 13.2 percent of board membership in the country are held by women and only 3.9 percent are board chairs, highlighting a stark mismatch of women representation in senior management and in the boardroom.

To get leadership on board, it’s important to understand how diversity directly benefits corporations. Here’s how:

Diversity benefits customers

Companies thrive on creating diverse solutions for customers. Different perspectives help better meet the needs of diverse customers, therefore, driving growth. In Southeast Asia, diversity is strongly linked to innovation. Companies with five or more dimensions of diversity attributed 46 percent of revenue from new products, 10 percent more than those with only one dimension.

Diversity benefits employees

Diversity driven by formal workplace policies and informal company culture helps employees feel welcomed and engaged. This affects all employees across the board – current, new, and potential.

New employees feel supported and included, helping them adapt much quicker. It also reduces employee absenteeism and increases employee loyalty. As much as 53% of employees in Asia believe that greater diversity and inclusion would help employers better retain talent.

In a region where more than 70 percent of senior executives report securing top talent a challenge, ensuring workplace diversity is no longer an option but a necessity.

Diversity also matters to the new generation of workers. According to Deloitte, 58 percent of millennials from diverse organizations agreed that their companies were good at attracting and retaining talent, compared to 41 percent who said the same from non-diverse organizations. Additionally, 69 percent of employees from diverse organizations said they would stay beyond five years, more than double those from non-diverse ones.

Driving gender equity amid COVID-19

The pandemic has undone much progress in gender equity as women across the globe are disproportionately impacted.

In the Philippines, 51 percent of women compared to 34 percent of men reported a decrease in formal employment amidst the COVID-19 pandemic. Moreover, over four million employed women were at risk of job disruption, especially those in industries such as wholesale and retail, and accommodation and food service activities. For those able to enjoy job security amid the pandemic, whether as frontline workers or in a work-from-home arrangement, women may be particularly vulnerable to the health impact of COVID-19, on top of socio-economic concerns.

It’s time for corporations to step up – from changing practices to promoting more female workforce participation. True gender equality goes beyond flexible working hours. Here are some ways corporations can continue to advance the issue in the new normal.

First, kickstart initiatives that directly champion female leadership. By providing platforms for guidance and mentorship, they help develop leaders at all levels to accelerate the inclusion and advancement of women. 3M’s Women’s Leadership Forum (WLF) is one such example. It now has over 5,000 employees in its 65 chapters worldwide, including the Philippines.

Second, redesign the recruitment and interview processes to ensure a fair playing field for all. According to global recruitment consultant Hays, the top three ways organizations in Asia proactively seek diverse candidates include employee referrals; utilizing data to choose channels that produce most diversity; and working with specialist recruitment agencies to engage applicants from underrepresented groups. With a cumulative goal across all diversity categories to double the pipeline of diverse talent in management globally from 32.6 percent to 65.2 percent, 3M is working on removing all individual discretion and bias from interview processes, and investing in a new interview management system focused on skills-based hiring.

Third, introduce employee training to address unconscious biases. This can help employees identify and understand potential biases and the tools to change them. There are still some ways to go in Asia. While 72 percent of employees here agree that unconscious bias training is beneficial, only 49 percent of employers are providing it. To strengthen our inclusive culture, we are incorporating unconscious bias training at all levels of our organization, starting in the United States.

Lastly, corporations can support gender equity-focused non-profits and empower employees to donate their time and skillsets to such causes. More recently in the Philippines, 3M has partnered with Mano Amiga Academy to create supplementary science education activities for students at home, as well as to support the school’s STEM Warriors Camp, encouraging girls to nurture their interest in science, technology, engineering and mathematics (STEM) and to consider these as future career tracks.

Diversity brings undeniable benefits and in these challenging times, the need for corporations to strengthen diversity initiatives and policies is more urgent than ever.

Let’s work together to heed this call. 


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