Gender equity drops in COVID economy

In the last year, the number of women reaching senior leadership positions in ASX200 companies has flatlined.

According to the Chief Executive Women (CEW) ASX200 Senior Executive Census, just 12% of executive leadership team roles that have profit and loss responsibilities are currently held by women.

Of the 25 CEO appointments that have been made so far in calendar year 2020, just one was a woman.

The results are disappointing, especially at a time when more attention than ever before is focused on the makeup of executive teams.

Longitudinally, this year is an aberration. Over the last four years, the number of women in CFO roles has increased from 9% to 16%. The number of organisations that have achieved gender balance (at least 40% of each gender) on their leadership teams is up from 16 in 2017 to 30 this year. Another 34 companies are close to achieving this level, with somewhere from 30-39% female representation.

The importance of balance

Having a diverse board and executive team has been linked to company performance.

AMP Capital senior economist Diana Mousina says she is seeing similar trends on gender equality, though it's difficult to parse trends due to the instability and uncertainty caused by the ongoing pandemic.

"Usually, economic downturns tend to reduce financial gender inequality," she says. "This is because downturns usually result in yclical industries like manufacturing and construction (which have a much larger share of male employment) underperforming, while female dominant employment sectors like healthcare and education are non-cyclical and perform much better.

"But, the COVID-19 pandemic has seen a different downturn. The industries hit the hardest haven't been the traditional cyclical industries, but industries in the services economy in which women tend to have a larger employment share, including retail, accommodation and food services. Since March (when the pandemic really hit Australia) more women than men have lost their jobs as a result of COVID-19, and more have completely left the workforce."

The pandemic has shifted women into a more traditional role of primary caregiver for children, something Mousina says was reflected in her own household. "I can personally attest to these productivity challenges. The peak of the pandemic in March-April was very tiring, trying to manage television and radio interviews with an energetic 2-year-old singing in the background."

The changes to come out of the pandemic

Mousina says that the pandemic may end up being a net benefit to women in the workforce because of structural and institutional changes to what we consider work. "This will be a huge help to many women who often cite the need for more flexible working to help manage the family load. And there are also pockets of families in which men working in roles that can be done from home have taken a larger share of family responsibilities, as the females have been essential workers (in health and education) in professions where they can't work from home."

"I think the biggest change to the workplace in a post-COVID world will be increased flexibility. Employees will demand the flexibility around working from home and working hours which they have gotten used to in the COVID world. 2020 has demonstrated that employees can be trusted to work from home so the increase in flexibility is a good thing, as it should be good for employee productivity."

CEW's president Sue Morphet and chair Jenny Boddington agree. "Our research shows that caring for young children and the cost of childcare continue to present powerful financial disincentives to women working full time.

"But we also know that companies achieving gender balance in leadership roles are overcoming these barriers."

Mousina says that changes in the childcare arena could prove significant. "Companies could consider offering paid parental leave that is available to all genders and encourage take-up of parental leave for their staff. Companies could also consider co-operating with childcare providers to allow their staff to salary sacrifice childcare payments to encourage its take-up. The government maternity leave scheme (which is means tested) could be also extended to males who are primary carers in the first year of their child's life."

Outside of childcare, future workplace flexibility could also change how women are able to work.

"The other big impact will be potentially some downsizing to the office space if employers have a certain percent of their workforce working from home. I think talk of the "demise of the office" is too dramatic, but there will be some downsizing to office spaces."

In their message on the 2020 CEW census, president Sue Morphet and chair Jenny Boddington encouraged business leaders to take proactive steps to on gender balance. "As leaders, we urge you to think about the actions and practical steps you will take to ensure better balance within your business and a gender-balanced leadership pipeline.

"Our economy will be stronger if we harness the best talent and leadership available. Without change, we will not capitalise on the full productivity of our workforce and the education investment in Australia's highly capable female talent."