Corospondent July 2018

Corospondent - July 2018

Winter 2018

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L’Avenir des femmes - July 2018

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Kirshni Totaram

Kirshni Totaram

Kirshni is global head of institutional business. She is a qualified actuary and a former manager of the Coronation Property Equity Fund. Kirshni joined Coronation in 2000.

Despite pressure from governments, popular movements such as #MeToo and even investors, we have not seen meaningful change for women in the workplace. Women are still scarce in senior management positions and the average take-home salaries and bonuses of female employees still fall below those of their male counterparts.

Extensive research has been done on women in the corporate world in a variety of jurisdictions and sectors. Although the data and reporting have major flaws and should by no means be used as a definitive source, the consistency of the trend running through the data – across countries, industries and all sizes of companies – is worrying and requires pause for thought.

The results of the UK government’s gender pay gap reporting procedure, which requires all employers in the UK with over 250 staff to report on the pay difference between men and women, shed more light on the ongoing problem. More than 75% of UK companies pay male staff more than their female counterparts, and 9 out of 10 women work for companies which pay them less. Only 11% of men work for a company where women earn more than they do. In addition, a common feature of the disclosure is the absence of women at senior management level, with women representing only 16% of executive committees in the top 350 companies in the UK, while some of them have none at all. While we acknowledge the current pay gap and inequality issues, the worrying part is the lack of a pipeline of women being skilled and trained to assume these roles in years to come, and that organisations have not been vocal about their plans to address this. This is despite the fact that women have outpaced men academically for more than 30 years. But not only companies remain under-represented; the same can be said for political leaders, government officials and even pension fund boards of trustees where the number of women represented remains low.

While these trends are of serious concern and remain a big obstacle to having an economy that is more inclusive, some of their consequential effects are long-term societal problems which are often hidden. One of the issues I refer to here is the pensions gap – the pay gap that women experience has long-term implications, particularly for their retirement. Because they receive lower salaries and may contribute smaller proportions to their pension pots, their pension payouts are far less than those of men, a fact which is especially worrying as women generally live longer. Gaps in a woman’s career which they take to have children, as well as a larger percentage of their income spent on the household and broader family, also take a toll on final pension amounts. There have been calls to address this material issue in many countries, but as yet we have not seen any corrective action.

To compound the problems we already have with the numbers is that most men in senior positions often find the current low representation of women at senior levels as being adequate and in fact an indication of a job well done. We find this perception among many women too – having been led to believe that small representations are adequate. This is once again a sign that the expectations from society in this regard simply need to be reset. In fact, one of the biggest challenges in addressing gender inequality is that many of the leaders required to do this are men who have their values entrenched by a patriarchal society.

I often get asked why we have such a small number of women in senior positions. The answer is not obvious or simple, and I have spent much time reflecting on it. Many women voice their reasons as follows: companies encourage workplace practices and barriers which hold them back or make them feel excluded; they have less guidance and opportunities for promotion at early levels and have to contend with maternity leave, children and part-time work. Furthermore, they reason that many companies adopt a ‘one size fits all’ approach, showing little recognition for the fact that the needs of men and women in the workplace are different and so too are their contributions. I also often hear that women ‘self-select’ out of the workforce because they are not as competitive as men, or are generally more risk averse. This intrigued me, as my own experiences and upbringing have proved different.  

In their book, The Why Axis: Hidden Motives and the Undiscovered Economics of Everyday Life, economists Uri Gneezy and John List use experimental economics to determine whether women really are less competitive, or whether they are just socialised that way. Their answer was that women raised in a matriarchal society are just about as competitive as men raised in a patriarchal society. This finding does feel intuitively right. Societal conditioning plays a major role in the way girls and boys are brought up and cannot be overlooked. Girls are typically expected to be ‘perfect’ and as such grow up to be less risk averse than men, though this particular trait is not evident in matriarchal societies where women play large leadership roles.

Interestingly, countries which boast the best progress in female economic empowerment and the smallest gender pay gap are Iceland, Sweden and Norway, all of which have progressive attitudes towards women, especially with government-led initiatives in the workplace. Larger government spending on family benefits significantly reduces lower pay for women, while greater affordability of childcare could improve the number of women in the workforce, as does longer paid periods of maternity leave and shared parental leave. Encouraging more women entrepreneurship and improving opportunities in higher-paid roles through flexibility also helps to reduce the pay gap.

If women are not integrated into the economy, we miss out on skills, ideas and a different perspective. Efforts to achieve equality in the workplace are of benefit to everyone, as diversity leads to stronger business results and stronger businesses. To build future businesses that are dynamic and inclusive, we need to have equal opportunities for all and improve the pipeline of women with potential. We cannot be satisfied with a few high-profile women promoted to senior positions while the rest are left behind. When the most talented people can rise to the top regardless of what they look like or where they come from, we all end up winning.

At Coronation, we believe we are addressing gender diversity and equality at all levels. We have a majority female workforce with an average tenure of almost 18 years at top management level, and ranging between five and nine years across all other areas of the business. Our focus on gender diversity helped inspire our first annual Women’s Day event last year in Johannesburg, where mentorship was one of the themes. The event led to the creation of our mentorship programme which was launched for 14- to 15-year-old schoolgirls and includes a number of sessions aimed at inspiring independent thinking by broadening a student’s knowledge about money management and life lessons. The 2018 Women’s Day event, for our female clients, staff and schoolgirls, will take place on 1 and 2 August in Johannesburg and Cape Town respectively.