Why Canadian companies are right to reject gender diversity policies

Recently, an article came out in the Globe and Mail that the vast majority of Canadian firms are rejecting gender diversity policies. Securities regulators suggested a formal policy, which would put companies in line with new regulation, that has been adopted by 10 provinces in the country, to report on how many women they have in their boards – and what their plans are to increase the number (if it is unduly low). The alternative to “plan” is “explain”, meaning that companies must either plan to increase the number of women in senior roles or explain why it is justified in its low state; many company are opting for the latter.

However, this is not a problem, and here’s why: Creating a plan to simply increase the number of women in a firm is not how to solve the problem of diversity and inclusion.

Looking back to the early 1960’s and 1970’s in the United States, the government already tried this method. They enforced quotas on hiring of women, which was intended to be a way to rectify the discrimination of the past. The measure created resentment against the women in the firm who, regardless of actual qualifications, were perceived to be nothing more than “quota hires” and thus were not respected or considered real members of the team. This led to a destruction of the intent of the programs, and eventually formal quotas were removed.

Today, we face a different challenge. Women are more educated than men on average and anecdotally are hired at similar rates to men for junior levels. However, they are paid less and the percentage of women steadily drops as you move up the ranks in a company. So companies are getting women in the door, but are having a hard time keeping them and developing them to the same degree that they do their male employees. The failure to have women in high ranking corporate positions, then, will not be fixed by simply hiring them into those positions; it is obvious there is more at play here. While hiring women at the top should be considered just as one would consider a male – as a qualified candidate – fixing the underlying issues of gender diversity in the workplace requires focusing on two things: Changing a static culture and a developing an environment of inclusion.

A Static Culture:

Increasing numbers is the easy way out. However, it is also the least effective. Sure, you can hire more women on your board (and your plan could include things like “partner with women’s groups”, which is a great step to take to increase the number of women you have access to). However, numbers are not the problem, culture is. When a culture is static – that is to say it remains an “old boys club” or “frat house” (as was the case with Twitter earlier this summer) where women are not respected and after-work meetings take place at smokey bars or even strip clubs – then it does not matter how many women you hire because they will not feel comfortable, fit in, or stay very long. This not only removes the potential benefit you can receive from women in the workplace (both as someone with a different perspective and a highly qualified employee on their own merits), it could spell internal disaster as costs of hiring skyrocket and team cohesion drops.

A Lack of Inclusion:

If diversity is inviting people over for dinner, inclusion is making them feel at home and able to be their true selves. When you bring more gender diversity into your firm, you are more profitable; this is caused not necessarily by the presence of women, but because a woman will inherently bring different perspectives, views, and ideas to the workplace versus a man. When exposed to different viewpoints and perspectives, every team member is more productive and effective, leading to a better outcome for the company. This cannot happen, however, unless the firm is inclusive of different opinions, perspectives, and ways of work. Simply hiring more women with no regard as to how to leverage their unique perspectives and identities is a recipe for dissatisfied employees and executives, not to mention bad feelings reverberating throughout the firm.

Start from the bottom up to create inclusive environments

If firms want to increase gender diversity at the top, they must work from the bottom up. Studies show that mentorship and ally networks help all employees (and particularly women) advance their careers. Further, career discussions with managers help, but only if they are based on objective metrics and all employees are given the opportunity to display their talents and learn. Finally, creating a culture that celebrates people who bring in new ideas – whether or not you end up using them in your business processes – will cultivate an environment that women can thrive in.

When you leave increasing gender diversity to nothing more than increasing the number of women, you lose out on the benefits of what gender diversity can truly bring. In order to leverage the power of all your employees, work to create cultures of inclusion that enable their success from the bottom up, instead of hoping that solely hiring more women at the top will fix the problem.