Bath Business and Society

Research, analysis and comment on the role of business in society from Bath's School of Management

Tagged: Women

Getting women onto the board – why some countries fare better than others

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📥  Business and society, Gender equality, Policy

Office Politics is simply how power gets worked out on a practical, day-to-day basis. 

Office politics "is the use of one's individual or assigned power within an employing organization for the purpose of obtaining advantages beyond one's legitimate authority. Those advantages may include access to tangible assets, or intangible benefits such as status or pseudo-authority that influences the behavior of others. Both individuals and groups may engage in Office Politics." 

Office politics differs from office gossip in that people participating in office politics do so with the objective of gaining advantage, whereas gossip can be a purely social activity. However, both activities are highly related to each other.

Office politics also refers to the way co-workers act among each other. It can be either positive or negative although for most of us 'abnormals' it's negative!

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The world over, there are more men than women in corporate boardrooms. This means that business is missing out on the talent and skills of a hugely important group that could make business more competitive. Here, Dr Johanne Grosvold and Dr Bruce Rayton discuss research which shows how four key institutions - family, education, economy, and government - either facilitate or hinder women’s rise to the boardroom.

Following the collapse of Lehman Brothers in 2008, Christine Lagarde of the World Bank questioned whether the bank would have collapsed had it been the Lehman Sisters, rather than the Lehman Brothers. She suggested that insufficient gender diversity in the upper echelons of financial institutions was partly to blame for the financial crisis and corporate collapses.

The continued under-representation of women in corporate boardrooms across the world remains a thorn in the side of big business and politicians alike. Increasingly though, governments and businesses are beginning to consider what can be done to redress the balance. Some countries such as France and Sweden are leading the way with up to 41% of women on the board, while others such as Greece and Malta lag behind with rates of only around 5-10%.

Given such cross-national variation, we set out to understand why it persists and to identify what could be done better to make gender diversity in the boardroom a reality. Taking a sample of 23 countries, including most of Western Europe, the USA, Asia and Latin America, we analysed the role of education, family, religion, economy and the role of the government in influencing board diversity. Our results were both surprising and encouraging.

Out of the five institutions we analysed, four were statistically significant in helping to explain why women do or don’t make it to the boardroom. Family, education, economy and the government all played a role while religion was the only factor that had no apparent effect.

Education - in countries where women and men enjoy similar levels of enrolment in higher education, women are better represented in the boardroom.

Family - in countries where there are fewer incidents of divorce, there are fewer women on the board. In other words, we found that an unintended outcome of higher rates of the divorce over the last few years has been greater labour force engagement and executive ambitions amongst women.

Economy - where women make up a smaller proportion of the managerial labour force, there are fewer women on the board.

Government - in countries where governments back their welfare legislation and family friendly policies with money and, for example, subsidise childcare, women are better represented in the boardroom. Passing legislation and instigating initiatives designed to encourage women to balance family and working life only give the desired results if there is adequate funding to make these initiatives meaningful and effective.

We believe these results may be good news for business and women alike. Increasingly more women than men are pursuing higher education, which means they are giving themselves the best starting point for climbing the corporate ladder. It is important, though, that governments consider the potential effects of their broader policies on women and families, to ensure that these help rather than hinder women to capitalise on the benefits of higher education.

In many countries, women retain the role of primary carer. Governments are, however, increasingly attuned to the need for providing better funded welfare provisions such as subsidised childcare to ensure that women are able to contribute fully to society and economy. This suggests that going forward, business is likely to reap the rewards of even more and better talent. To maximise these benefits, business could play a more active role in complementing government action, for example by including subsidised childcare in remuneration packages in countries where such provisions are not routinely provided by the state.

Welfare provisions of this kind have typically been associated with liberal or social democracies. But the growing acknowledgement of the business case for supporting women's career progression means that governments and employers in all countries should do more to encourage gender balance in the boardroom.