New Zealand's top business leaders are meeting this month to help boost the country's economic performance through the power of diversity.

The March 14 summit will bring best business brains to bear on a road map to jump-start, for example, flagging rates of women in business leadership - proven to increase corporate performance and thus national economic returns.

A 2011 Goldman Sachs economics research report found closing the gap between male and female employment rates would raise New Zealand GDP (gross domestic product) by 10 per cent. But while 58 per cent of Bachelor's degree graduates are women, females make up only 19 per cent of New Zealand-listed company boards and 17 per cent of senior management.

The report found that, since 1970, the rise in the female employment rate has boosted economic activity by 30 per cent. But it argued New Zealand was still only three-quarters of the way to unlocking the hidden value of the female labour pool.

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McKinsey research in 2014 also showed US companies in the top quartile for gender, racial or ethnic diversity were more likely to have financial returns above national industry medians. Those in the bottom quartile were less likely to achieve above average returns.

Professional service firm KPMG is one of those involved in the new initiative - Champions for Change - driven in part by a frustration with a slowing rate of progress. KPMG partner Kim Jarrett says: "We've got to the stage where we're not getting any traction. We need something quite dramatic to shift the dial."

The who's who of large businesses and government is aiming to move that dial on diversity of all types in senior and leadership positions by setting goals for increased diversity and inclusive leadership by 2020 and the means by which they will be reached.

Along with KPMG Chief Executive Paul Herrod, CEOs invited include Fletcher Building's Mark Adamson, Fonterra's Theo Spierings, Barbara Chapman of ASB, Police Commissioner Mike Bush, Air NZ's Chris Luxon, Stephen Town of Auckland Council plus Contact Energy's Dennis Barnes and other major private and public CEOs.

Jarrett says diversity and inclusion will unleash wider talent pools, diverse thinking, greater innovation, improved decision-making and ultimately drive better returns for shareholders.

"You can't innovate if everybody around the table thinks the same way," Jarrett says. "The benefits of diversity at a senior level for companies and organisations are well-proven; the emphasis now is on setting benchmarks and goals and agreeing on measurement."
Champions for Change is inspired by the work of Global Women (the secretariat for Champions for Change and advocates of diversity and inclusion in New Zealand businesses) and the successes of similar initiatives overseas.

For example, in the UK in 2010, women made up only 12.5 per cent of the boards of FTSE100 companies. A UK government report set a target of a minimum of 25 per cent by 2015 and the number reached 26 per cent last November. The push there has been taken up by powerful groups such as the 30% Club.

In Australia, Male Champions of Change, a group including the CEOs and chairs of ANZ, Qantas and Telstra, is pursuing a four-point action plan to boost workplace diversity. The Australian group publishes the results and progress of each of its members each year and shares insights gained from the programme.

"These are people who want to see measurable results, and identify workable ways of achieving them; we can learn from them," says Jarrett.

Gender disparity emerged as a critical theme for discussion at the World Economic Forum (WEF) agenda in Davos this year. The WEF's recent Global Gender Gap Report - which ranks 145 economies according to how well they are leveraging their female talent pool - estimated it will take over 80 years to achieve gender parity in the workplace, given the current rate of women's advancement.

New Zealand ranks 10th in that area, ahead of the UK (18th), the US (28th) and Australia (36th) but behind many Scandinavian countries.

The obstacles aren't confined to the sometimes-unconscious bias of male decision-makers. Jarrett quotes Facebook COO Sheryl Sandberg, who says more women need to lean into their careers: "For many women the idea they can have a successful professional life and a fulfilling personal life is difficult at best and impossible at worst".

That might mean measures such as mentoring, flexible working and appropriate human resources policies. Other initiatives to help build a more diverse workforce include an equal number of male and female short-list candidates for roles and equal numbers of men and women on interviewing panels and flexible working.

A just-published study by Australia's Curtin University found women in management generally earn 29 per cent - or around A$100,000 a year - less than men. It also found the pay gap narrowed if the number of women on corporate boards increased.
For Herrod, KPMG's New Zealand Chief Executive, Champions for Changes' work has a personal dimension; he wants his two young daughters to have a future in which women are paid equally for equal work and experience.

"The Champions for Change initiative brings a concerted focus to embedding a culture within New Zealand businesses that encourages a measurable step-change towards diverse leadership."

"Equality in the workplace is a basic fundamental that isn't being recognised in New Zealand - and needs to be. Being a part of this important commitment to change is another step on KPMG's Diversity and Inclusion journey."


Read more from KPMG here