Despite recent advances in gender equality in the workplace, Equileap‘s 2018 Gender Equality Global Report and Ranking reveals just how much work is yet to be done.
We sat down with Equileap’s executive director Diana van Maasdijk to discuss the report’s findings and the state of corporate gender equity today.
Tracking Workplace Gender Equality
Van Maasdijk cofounded Equileap with Jo Andrews in 2016 to gather data on companies from a gender-lens perspective. This is the second year that the organization has produced the Global Report, which ranks companies on 19 criteria on four categories—gender balance across the company, pay equity and work-life balance, gender equity policies, and actions taken to reinforce women’s empowerment.
“We thought that if we researched the companies, scored them, and started publishing the top companies—and what was happening year by year—that would encourage the companies to be more transparent to show what they’re doing and how they’re improving,” Van Maasdijk said.
Since the organization’s founding, the data it’s collected has become a valuable resource for gender-lens investors. Institutional and private investors have licensed Equileap’s data to serve as the foundation for $620 million worth of investment products.
Progress on Unsteady Footing
While the data in this year’s report showed that some companies are improving, Van Maasdijk hopes to see swifter progress. “Even the Top 200 companies globally last year scored, on average, a C,” she said. “This year, they’re scoring an average of C+. Even though we see some improvement, we think there’s a lot of room for improvement.”
General Motors took the top spot in this year’s Global Report, followed by L’Oreal and French apparel firm Kering. Merck & Co. and Singaporean telecom company StarHub rounded out the top five. One of eight B+ companies, GM’s top spot reflected its position as the only company among the 20 largest in the United States that has both a female CEO and a board comprising men and women equally. In addition, GM has no overall pay gap, offers flexible hours and work locations, and has policies aimed at combating sexual violence at work and improving supplier diversity.
Published in October 2018, the Equileap Global Report found that communications, financial services, and utilities represented the best-performing sectors on measures of gender equality in the workplace, with tech companies showing the most improvement—14% of eligible tech firms made it onto the report’s top 200 list, up from just 3% in 2017.
Van Maasdijk said that the advances in the tech industry reflect growing public sentiment surrounding tech companies’ gender practices. In 2015, after a high-profile gender discrimination lawsuit in Silicon Valley, a handful of tech executives published a report, Elephant in the Valley, chronicling the workplace issues women faced there. As the report garnered media attention and was bolstered by the #MeToo and #TimesUp movements of the past year, tech companies began targeting ways to close the gender gap within their corporations, from creating new policies around sexual harassment to making executive changes.
According to Van Maasdijk, that’s no coincidence. “Public opinion matters and has significant impact,” she said.
Challenges on the Road Ahead
Still without any companies scoring in the A range, the Equileap report suggests the hard work ahead for gender equity advocates. Among the companies studied, not one has achieved gender balance at every level of employee, and many companies have made claims of pay equity without providing supporting data. The report’s three lowest-performing sectors were energy, industrial, and consumer cyclical.
And while gender equity in the workplace is gaining momentum, Van Maasdijk said that many investors still need to be educated on the business case for gender-lens investing. A 2018 McKinsey & Company study found that gender diversity on executive teams is related to both profitability and value creation.
“I’ve been encouraged to see how much interest there is, and seeing articles on this and people talking about it,” Van Maasdijk added. “I think we’re on the right path, but it’s not mainstream yet.”
Van Maasdijk said that she sees a host of gender equity issues remaining in corporate America, including the glass ceiling and the pay gap. She also recognizes the challenge of the common perception of gender-lens investing as a niche part of ESG investing, rather than a core component.
“For a long time in ESG, the ‘E’ was most prominent,” Van Maasdijk said. “Of course, environmental protection is something we should be doing and prioritizing. But there are very clear connections between social justice issues and the environment. It’s not an alone-standing concept—this is a cross-cutting issue.”