Start-ups urged to set the tone for gender diversity

Start-ups can set the tone with regard to gender diversity, experts say, after a new report revealed more than 75% of small firms do not intent to appoint a female to a senior management position.

The report, from Dun & Bradstreet and support group Chief Executive Women, is based on a survey of 1,200 chief executives over a three-month period (September to November 2011).

According to the survey, 75% of very small firms (one to five staff) and 77% of small firms (six to 20) do not intend to appoint a female to a senior management role in the next three months.

Not surprisingly, companies in wholesale and retail are more likely than those in manufacturing to appoint women to senior management in the next six months.

However, more than 65% of small- to medium-sized firms will not be mandating that female candidates be shortlisted for senior management roles over the next six months.

According to CWE president Belinda Hutchinson, studies show firms with gender diversity in their senior ranks tend to perform better in a number of areas, including return on equity.

“More needs to be done to support small- and medium-sized businesses [to] increase female participation in management,” Hutchinson told News.com.au.

Yolanda Vega, chief executive of the Australian Women Chamber of Commerce & Industry, agrees gender-balanced environments provide a better outcome “for SMEs and corporates alike”.

“We can’t continue to compete in a global environment if we don’t use all our resources, and women are a major resource,” Vega says.

According to Vega, small businesses are more inclined to foster gender diversity than their larger counterparts, partly because so many small businesses are run by women.

“If we look at SMEs around the country, which make up 97% of employers in Australia, out of that 97% almost 40% are [run by] women,” she says.

“Women employ women as well as other men… Women are equal employers.”

Vega says it’s encouraging to see so many start-ups being launched in Australia because, unlike many bigger companies, they’re “not entrenched in the archaic systems”.

“Young and vibrant entrepreneurs are doing what’s best for their business… They are setting an example and it’s about time the big boys at the top start taking note,” she says.

Martin Nally, founder of hranywhere, says regardless of size, the best organisations in the world have four common traits.

“They are a strong vision, roles clearly defined for the people in the business, exceptional communication, and diversity in its full measure,” Nally says.

“Diversity in its full measure means your organisation is a mirror of the customer base you support.”

Nally says while he believes people should be offered jobs based on merit, not gender, more businesses are moving away from the “ideal” of a Caucasian male aged under 50.

“I’m not someone who recommends quotas but I am someone who says, are we truly reflective of the people we’re servicing?” he says.

“If you do not have a good representation [within your business] of the customer base you have, you’re missing out.”