March 8 marked International Women's Day, 24 hours to celebrate the political, social, economic and cultural achievements of women. Yet in corporate Canada we remain frustratingly far from reaching gender parity. In fact, only 3 per cent of TSX-listed companies have a female CEO and only 14 per cent of board seats at TSX-listed firms are occupied by women. At this pace, we remain some 200 years from achieving parity. The risks of this reality are simply too great to be accepted.
Canada is in a unique position globally and with that comes the privilege that we can find new ways to drive change. Our financial institutions are already driving innovation with technology, but the challenge that lies ahead is how to apply this same thought process to diversity to reap the economic and social rewards. According to the McKinsey Global Institute, Canada could add $150-billion in incremental GDP in 2026 by advancing women's equality.
However, if achieving gender diversity was easy it would have been done by now, especially with all the intelligent and well-intentioned professionals working on it. Unfortunately, it is hard and requires major societal shifts, senior level commitment, focus and significant effort; but worse what we have done to date has not yielded results.
Women in Capital Markets (WCM) promotes gender diversity within the Canadian financial-services industry. Our work suggests that the answers to diversity are not as simple as providing flexible work arrangements or introducing better work-life balance. Nor is the holy grail of diversity found in unconscious bias training, or additional networking opportunities for women. These all help, but in isolation, none of them move the dial.
Our research, conducted in partnership with Emerge Consulting and Analytics, suggests that women and men in finance diverge dramatically in their experiences at work, with a notable gap growing from the first year of a career to the sixth and then slowly narrowing. This eventually leads to what we see as the ambitious, fearless and frustrated women who climb into the executive ranks, and a separate group who shift paths, change industries or leave the work force altogether, leaving behind them an economic loss and diversity that will not be replaced.
Understanding how and why experiences differ is critical to solving some of the fundamental questions surrounding building diverse teams. It was Albert Einstein who said that if he had an hour to solve a problem, he would take the first 55 minutes defining the problem and only the last five solving it. We need to spend more time on defining why we have seen such shamefully slow progress on diversity.
Our research suggests that in finance, there are clear areas around leadership, transparency and culture that impact the different experiences men and women have at work and, therefore, easing some of these could help propel large strides.
Typically, men and women with the same manager respond differently when asked about the respect, importance and support they receive for their work, with men feeling more positive across the board. In addition, our research suggests that women typically face less accessibility to their manager and harbour concerns about whether they are fairly compensated. This all results in women feeling less fulfilled at work than their male counterparts.
All the mentorship or "leaning-in" in the world won't be enough to balance these scales but we also don't see this as an area for women to be "fixed." Instead, we suggest that this is the time for a dramatic and purposeful shift in management styles, cultures and corporate transparency. We see early signs of progress at some of the largest Canadian financial institutions, where CEOs are engaged and holding their management teams accountable, but there is still significant work to be done. Companies need to tackle these issues head on and boards of directors need to be engaged on diversity.
It is our view that leaders can drive change by attacking each one of these gaps thoughtfully and purposefully. To begin sharing the results is critical, since the more management understands about the path of women in the work force the better equipped they will be to shift their leadership styles. Secondly, opening a dialogue between management and the work force with regards to the specifics of gendered experiences is critical. It is also vital to train managers and have focused policies that embed transparency. Managers need to understand unconscious bias but they also require specific training on how to successfully lead diverse and inclusive teams.
So while International Women's Day was an important celebration of all the women around you, let us also use this time to recognize that what we have done to date has failed to yield diversity and let us commit to a new approach, one that will leave gender parity as a legacy to the next generation. This is something powerful to celebrate as we #pressforprogress.