According to the World Economic Forum, it will take 99.5 years to close the global gender gap. The closing of the gap could result in added 15 percent of GDP to economies, some of them worth over $6 trillion. The potential of inclusivity in business is compelling, however unlocking these benefits must begin with focused and measurable action from the business.
The Diversity Matters research suggests that in the UK, greater gender diversity on the senior leadership team corresponded with the highest performance uplift: for every 10 percent increase in gender diversity, EBIT rose by 3.5 percent.
Gender balance doesn’t equal inclusion
Most organisations understand that having a diverse workforce is important. However creating an environment that values their unique talent and makes them want to stay could be a challenge. To realise the potential inclusion and diversity, organisations should take full advantage of the opportunity diverse teams represent, particularly when it comes to the talent pipelines, such as attracting, developing, mentoring and retaining the next generation of procurement leaders.
Some sectors are doing better than others. In technology, women accounted for nearly 30 percent of the sector’s entry level workforce in 2019. Last year, over 13 percent of women were promoted compared to 12 percent of men and the overall hiring rate of women increased to 27 percent.
To unlock the talent potential and reap the rewards of diversity, culture change needs to happen first. While specific HR policies are important, diversity and inclusion also need to be about making each person valued, as well as continuously invest in their development, supporting and motivating them to succeed within their role and organisation. Executive sponsorship from the top is necessary to empower women to progress their careers – having visible female role models, provide mentoring for the next generation of female procurement leaders, as well as holding the leadership team accountable for improving gender imbalance are all equally important.
Read more: Unilever achieves gender balance across management globally – Unilever announced today that it has achieved gender balance across management globally, a year ahead of the target it set itself. With a higher representation of female managers than ever before…
According to McKinsey’s research, gender diversity correlates with the bottom line and organisations with a gender balanced C-suite have a higher likelihood of achieving above the average financial results. CPOs whose organisations have over 40 percent of women have reported significantly better financial performance over the last five years and 65 percent of the CPOs noticed an improvement in their procurement performance linked to the increase of number of women in their teams.
Inclusion and diversity are also increasingly becoming a competitive advantage for companies that attract and retain diverse talent. Research suggests that more diverse companies are more successful at winning top talent and improving their customer service, employee satisfaction and decision making, which in turn leads to increased revenue.
The Gender pay gap – ‘Median pay for all employees was 17.3% less for women than for men at April 2019.’
A recent survey of over 300 CPOs globally suggests that 60 percent believe that there are more women in their organisation compared to three years. However, the same survey also highlighted that women account for only 25 percent of the members of procurement committees and management teams. Whilst some mature procurement organisations in the US and Western Europe have recently appointed a female CPO, on average 80 percent of these roles in the top companies are still taken up by male leaders.
The facts speak for themselves – there IS value in gender equality, and furthering the inclusion and diversity agenda. And, happily this is now a conversation that isn’t just left to the ‘diversity team’. I frequently find a discussion about Procurement Transformation will turn quite naturally to inclusion and diversity as part of the enablers. This is positive. The next stage is to see these discussions turn into actions that deliver. Here’s to next years’ blog reporting both an increase in gender diversity, and the associated returns.