Why are women underrepresented in leadership positions in Australia?

While universities are churning out more female graduates, and men and women share similar career goals and ambitions in Australia, there is a distinct lack of women in high-level leadership positions. Women make up 42% of all employees, but only make up a quarter of executives and only 10 per cent of CEOs for large, for-profit companies. For women of colour and people of marginalised gender, these numbers are significantly smaller.  

A report by the Workplace Gender Equality Agency (WGEA) indicates that the managerial gap between women and men only widens with age. Within the 15-24 age bracket, there are slightly more female managers than male (4.0% compared with 3.3%). However, when you look at the 55-64 age bracket, that gap has widened to 20.7% male managers and 9.6% female managers. When broken down by race, these numbers are even worse. McKinsey Institute’s Women in the Workplace report stated while white women make up 19% of C-suite positions in the US, women of colour make up only 3%. The numbers in Australia are just as bad. Of the 2,490 people who occupy senior positions at ASX-200 companies, 76% have an Anglo-Celtic background, 19% have a European background, 4.6% have a non-European background and 0.4% have an Indigenous background.   

(graph from WGEA report) 

One study suggests the reason this gap is so pervasive is the difference in growth opportunities offered to men and women in the workplace. According to research by the Harvard Business School, women are given less informal professional development opportunities compared with men. Male employees tended to experience a more “sponsored” role, where more senior staff identified growth opportunities on their behalf and connected them with other senior-level managers who could train and facilitate promotions, whilst female staff received more traditional, generalized advice on things like common workplace problems. The highly relevant, personal growth opportunities and guidance is worlds ahead of the generalist advice received by female staff, and reflects the old school “boys club” we are all trying to move away from. 

Some would say the most obvious reason women often drop off the promotional ladder is due to taking time off for family care duties. However, of mothers in Australia that did return to work, 82% returned to their previous employer, and a large majority of those women (79%) returned to the same roles and responsibilities prior to motherhood. Another thing to note is that fathers’ career prospects remain largely unaffected by the birth of a child. Could it be that even when the mother is the primary breadwinner, she still does almost 10 hours’ worth of housework more than her partner, and therefore has less time (or inclination) to dedicate to their paid work, or that they appear ‘unmotivated’ or ‘disengaged’ due to their family commitments?   

A study from 2014 revealed managers perceived their female staff had lower motivation levels than male staff, regardless of their experience or seniority. There was also a strong correlation between the professional development opportunities offered to employees, and how engaged and motivated managers perceived staff to be. Therefore, the employees that were offered the most professional development opportunities were male. The study also found this to be a positive feedback loop – the more opportunities an employee was offered, the more motivated and engaged they were with work, and so on. 

Missing out on initial professional development opportunities can lead to missing out on growth and development opportunities down the track, and this is especially true for women.  

Diverse representation in positions of leadership is beneficial for closing the gender pay gap and gender equality as well as improving company profitability and productivity. Research by WGEA and the Bankwest Curtin Economics Centre found that organisations who have equal representation of women on governing boards have significantly narrower gender pay gaps across the organisation than those that don’t. Their 2019 report also found that in organisations with equal gender representation in leadership, women are now progressing into management roles at a faster rate than men, and if growth were to continue, it would only take 20 years to have equal representation in full-time management positions. 20 years is still a long time to wait for equality! 

As far as the financial benefits go, the 2020 Gender Equity Insights Report determined that an increase of 10% of female representation on Boards of ASX-listed companies leads to a 4.9% increase in company market value worth the equivalent of $78.5 million for the average company, and appointing a female CEO led to a 5.0% increase in the market value of Australian ASX-listed companies, worth the equivalent of AUD $79.6 million on average. 

A lack of diversity in senior and upper-level management positions is detrimental to employees and the financial interest of organisations. More importantly, it is hard, as an individual, to see yourself rising to a CEO, board director or senior management when the people currently occupying those positions are predominately old, white and male. One way to inspire yourself and others is through seeking out professional development, especially PD that is targeted at women and minorities.

YWCA’s TINA Talks are a great example of this – join our 2021 series and be inspired by those blazing the path to a more gender and culturally diverse future.