The EU, Quotas and an apology

A health warning on today’s post, for two reasons.  First, expect a rant.  This morning two of my favourite subjects caught my eye, the European Union and the subject of quotas.  Second, be prepared for an admission that I might have been wrong.

Shocked?  You should be.  I suspect this may be my first public admission of my own fallibility since 1987 ( I lost an argument over which one of the Farris Brothers played lead Guitar in INXS , it was Tim, not Andrew ).

Back to matters at hand.  Namely the EU and Quotas.  So here we go.  Ready, aim…….

Wait a minute.  Here comes the admission.  It looks as though for once I owe our good neighbours ( in that enormous waste of our hard-earned cash, I had to get it in somewhere ) in Brussels an apology.  It seems that for once they might actually be needed to do some good.

The subject of quotas is on the Agenda again and I am not talking about Fish Stocks.  This time it is back to the issue of diversity in the workplace, in particular in the boardroom.

3% of Fortune 500 CEO’s are Women.  In Europe, only 12% of Board posts are occupied by Women.  In the UK, the picture is a little better.  In the FTSE 100 the number of women in Board Posts is up in the last 10 years from 6.9% to 12.5%.  A step in the right direction, but there are still only 79 female Executives on the Board of Britain’s largest companies.

It makes no sense.  This is not 1811, this is 2011.  Organisations the world over are ignoring 50% of the population when it comes to picking top talent.  The debate rages on and yet little changes.  It’s a nonsense.

A 2010 report by McKinsey stated

“Operating results of companies which have greater gender diversification are 56% higher”

In 2007, A Goldman Sachs report evidenced

“closing the gender gap could boost U.S. gross domestic product, a broad measure of economic growth, by as much as 9%, and up to 13% in the euro zone”.

Based on the stats, business doesn’t seem to be getting the message that Talent is not defined by gender, race, sexual orientation or religious belief.  It is not defined by geography or culture, by nationality or heritage.  Get the message, pick the very best you can afford to deliver the very best value to shareholders, customers, employees, the wider world.

I don’t want to be told who to hire.  I don’t believe in quotas, it encourages all sorts of problems when it comes to hiring, but if the message doesn’t get through, politicians will step in and a quota is what we will get.  Politicians and Business don’t mix (with any degree of success).  Quota’s and Business don’t work.  If Business Leaders don’t wake up, then a quota is what we will get and we have only ourselves to blame.  For once, the politicians might just be right.

I’ll leave you with a sense of just what we are up against in the battle to get this message through.  Recently Josef Ackerman, CEO of Deutsche Bank, was reported to have commented that having more Women in the Board Room would make board meetings “prettier and colourful”.  I’ll leave you to make your own judgement.



Filed under Corporate Governance, Employee Engagement, Hiring

2 responses to “The EU, Quotas and an apology

  1. Pingback: Tweets that mention The EU, Quotas and an apology | The Recruiters Little Black Book --

  2. Dilip Bhatt

    (same comment posted on Linked-in HR UK Group)

    Have to admit based on the facts posted in the blog that in the FTSE 100 the number of women in Board positions is 12.5%, this has to be sad state of affairs.

    Senior politicians love this sort of stuff, Merkel said the lack of women in top management is a “scandal,” even Brown got his knickers in a twist and said ‘lack of women in UK boardrooms is ‘completely unacceptable’ and he demanded (whilst thumping the desk on doubt) that business explains itself.

    If I may digress, similar situation exists for the ethnic communities; there is a lack of black directorship and leaders generally at the board table. Typically equality impact assessments will show a lack of ‘ethnic’ managers, with the equality gap getting worse as we move up the hierarchy. I have seem quotas introduced to address these challenges and one of the most common is apply ‘positive action’ concepts, whereby we encourage and support members of ethic groups to seek and apply for senior roles. Did it work, well only to a degree? I suspect many organisations have applied similar positive action as been applied to address the gender gap at the board level, has it work, well only to a degree. It has taken 10 years to move from 1999 7% to 2009 to 12%. Ohhh hum….

    So I don’t think quotas will make a big difference nor will we see a step change, the worst outcome would be that female board members are appoint to meet equality goals and I am saying that as an Equality Practitioner. However, I do not see any reason why some government intervention would not be a bad thing. Why not ask companies to explain themselves as to why they have a gender gap at the board/managerial levels and actions they are planning to address the issue. Quotas per se would also be difficult; in that some industry sectors (e.g. building and engineering) will struggle to meet a general quota for sure.

    A tricky challenge indeed.

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