Why?

Is imposing quotas for women in the boardroom a bad idea? It is according to a recent article in The Economist. The article, as is normal for that August Journal, is reasonably balanced. I say reasonably as it does acknowledge many verities relating to women and work. Some excerpts follow:

There is a powerful business case for hiring more women to run companies. They are more likely to understand the tastes and aspirations of the largest group of consumers in the world, namely women. They represent an underfished pool of talent. And there is evidence that companies with more women in top jobs perform better than those run by men only.

McKinsey, a consultancy, recently looked at 89 listed companies in Europe with a very high proportion of women in senior management posts and compared their financial performance with the average for firms in the same industry. It found that these firms enjoyed a higher return on equity, fatter operating profits and a more buoyant share price. The authors described the correlation between promoting women and doing well as “striking”, though they admitted that they could not prove what was causing what. It is possible that firms that are already doing well tend to hire more female directors.

The evidence from Norway, the first European country to impose strict quotas, suggests that compulsion has been bad for business.

To obey the law, Norwegian firms promoted many women who were less experienced than the directors they had before.

A study found that firms that were forced to increase the share of women on their boards by more than ten percentage points saw one measure of corporate value fall by 18%.

Men do persistently underestimate women, argues Herminia Ibarra of INSEAD, a business school in France. Ms Ibarra looked at more than 20,000 assessments of INSEAD’s executive students. Male work colleagues of the women judged them to be just as capable as the men (or more so) in most areas, but thought that they lacked strategic vision. No such lack was seen when their female work colleagues judged the students.

The way patronage and promotion work within the corporate world may count against women. Nearly all the executives who rise to the top have had a powerful backer.

In all societies, at least for now, women shoulder most of the burden of looking after children and ageing parents. European women devote twice as much time as men to domestic tasks, according to McKinsey. It varies from country to country. Latin men are slacker than Nordics. Italian men spend only 1.3 hours a day on domestic chores, whereas Italian women spend 5.2 hours. In Sweden, the ratio is a somewhat fairer 2.3 hours to 3.4.

Partly because it is so tricky to juggle kids and a career, many highly able women opt for jobs with predictable hours, such as human resources or accounting. They also gravitate towards fields where their skills are less likely to become obsolete if they take a career break, which is perhaps one reason why nearly two-thirds of new American law graduates are female but only 18% of engineers.

Deutsche Telekom, a German media behemoth, has declared that 30% of its middle and upper management jobs will be filled by women by 2015. “We have tried mentoring, coaching and networks, but nothing worked,” says Anne Wenders, a spokeswoman for the company.

The fact remains that promotion and advocating women is in its early years. I am reminded of Kim Campbell the former prime minister of Canada she offers a possible solution to the perceived increase in ethics within corporations – female leaders – in several studies results show that when you have a critical mass of women in an organisation, you have less corruption...lest you think that all we aspire to for the world can be accomplished by male dominated organisations I have only to say to you: Enron, Taliban, Roman Catholic Church.