DIRECTOR'S SPEECH
Speaker: Fiona Krautil
Title: EQUAL OPPORTUNITY - AN ISSUE OF CONTINUING NATIONAL IMPORTANCE
Event: AIRC
Date: February 2003

Introduction
Ladies and Gentlemen, today I want to challenge the notion that equal opportunity is a marginal issue or that it is somehow a problem that is behind us all.

Equal opportunity has never been more important than it is today - not only for women but also for businesses and for our society.

Achieving widespread equal opportunity will require substantial redesign of Australian workplaces.

There are some marvellous examples in Australia of how re-designing jobs can promote equality and deliver business benefits.
But these are still too few.

Although progress has been slow over recent decades, I think the pressure for more action is gathering in our community and that there are some early signs that the pace of change will accelerate.

Women in the workplace, today & tomorrow
In EOWA's estimation, fewer than 200 Australian employers have made significant achievements in re-shaping their workplaces to make them more accommodating of the needs of women.

That's less than 10 percent of the organisations that are required to report to us annually - after 17 years.

Its pretty clear that the vast majority of employers who report to EOWA are still committed to doing the minimum required to comply with the Act.

Nevertheless, many of our corporate and government leaders believe that equal opportunity for women in the workplace is no longer a problem.

For instance, when we released our inaugral census last November the Commonwealth Bank chairman John Ralph echoed a lot of leadership sentiment in Australia when he said that it was only a matter of time until women achieved equality.

Well a lot of time has already passed under the bridge since the Whitlam Government successfully backed the historic equal pay for women case and the Hawke Government introduced the precursor to the EOWA Act.

During the past few decades, women have become more evident in the workplace and there are notable examples of women rising to senior positions.

Yet the overall picture is still quite gloomy.

The EOWA census of women on boards and in senior management showed that Australian women hold just 8.4 percent of senior executive positions.

Even more disappointingly, Australian women hold only 5 percent of executive positions in the core business areas, which are the main feeder group for CEO and Board positions.

This failure of Australian business to select women for executive positions in core business areas means that women will continue to be a novelty in Australian boardrooms for many years to come.

In addition, that lack of interest in providing equal opportunity clearly shows up in the pay statistics.Women earn on average 67 percent of male earnings. That's 271 dollars less per week.

Even in industries dominated by women, the gap is as wide as 54 per cent.

In fact, women earn less across every single occupational group1.

One reason for this enduring gap is that women have been marginalised from full-time work.

The percentage of women in full-time jobs has remained static for 25 years, while growth in casual and part time jobs has rocketed.

This degree of casualisation is obviously not consistent with achieving equal opportunity.

In the light of the overwhelming nature of this evidence, I don't think it can be seriously argued that time alone will solve the problem.

Though I must also say that in his comments John Ralph pointed to one of the economic consequences of our failure to make significant progress on this issue when he drew attention to the fact that over half of our law graduates are women.

This is true and it has been true for some time.

So much so that we are investing large amounts of money in developing the skills of hundreds of thousands of graduates with the certain knowledge that our workplaces will prevent them from realising their full potential.

That is hardly rational from a public policy point of view.

We can't solve the problem by stopping young women from going to university, so we're going to have to do more to address the persistent problems in our workplaces.

The CEO is critically important
I don't want to sound too pessimistic, that's not my natural disposition.

There are some excellent employers out there developing and implementing some exciting and very successful equal opportunity programs.

In fact, 2002 was a good year in the life of the Agency.

We identified 56 employers who could be described as leading edge.

Another 50 employers, met our waiving requirements, next tier down, and demonstrated that they had done everything reasonably practical to address the employment issues involved but they had not yet gone that extra step.

Moreover, a growing number of Australian employers want to be seen as Employers of Choice for Women, for instance, 46 CEOs and 230 other senior executives participated in this year's EOWA Business Achievement awards.

I mention this interest from CEOs because my experience, working in this area in business since 1988 and more recently at EOWA, tells me that CEO commitment and involvement is absolutely critical for achieving successful change.

Its also true that the presence of women in senior positions makes it more likely that progress towards equal opportunity will be sustained.

So it is disappointing that our first census found that over half (54 per cent) of Australia's top 200 companies still have no women in executive management positions.

Why male CEOs should remain so resistant to the idea of equal opportunity in the workplace is frankly beyond me.

It defies any rational explanation.

After all, there is clear evidence that providing equal opportunity directly benefits the bottom-line.

There is, moreover, a strong and well-accepted economic case for employers to invest in equal opportunity programs.

Equal opportunity reduces the costs of recruitment and retention, it increases the returns on investment in skill acquisition, it fosters a more committed and productive workforce and so on.

In these post-Enron days there are also good reasons for investors to welcome the greater diversity of perspective and openness that women can bring to the traditional clubbiness of our corporate boardrooms and senior management teams.

Call me biased, but I don't think its any co-incidence that it was a woman who finally blew the whistle on Kenneth Lay and his colleagues.

Neverthless, equal opportunity is not a rational commercial consideration but an emotional issue with most men.

Often men only change their views when they hear from their daughters about the problems they confront in their own careers. So what do you do about fathers who only have sons?

Recognising this reality led EOWA to describe its mission in terms of inspiring employers, without that inspiration equal opportunity is just not a goer.

Although, I should note in passing that many younger men are becoming supportive of equal opportunity programs because they can help them with their own desires to be more involved as parents.

Self-interest is always a great motivator.

Re-designing the workplace
Inspiring CEOs is one thing, but there is also the underlyng reality that the design of our workplaces has simply not kept up with social change.

We live in a two-income family society. Most women do paid work at some time in their lives and about three-quarters do some paid work during their child-rearing years. Yet we often talk as if female work is optional.

I think this mismatch between work re-design and social reality is fueling the extraordinary recent interest in debates around work and family issues.

Maternity leave is the current policy flashpoint but there will be many others before the heat goes out of this particular debate.

Statistics about workers with family responsibilities indicate that one-third of all employed men and one-third of all employed women have dependent children under 15 years of age (ABS, 1998a).

Nearly one third of employed caregivers have claimed that care-giving commitments caused repeated interruptions at work, resulted in their having to work fewer hours, or both.

Almost one-quarter has taken periods of unpaid leave; 16 percent have taken less responsible jobs, and 13 percent have refused promotion.

The ACTU recently described this phenomenon as downshifting.

Another study involving interviews with employees in several leading Australian corporations found that nearly three-quarters of people with dependent children said they would refuse a job or promotion if it decreased time available for family.

This appears to be a global trend, as a recent Harvard Business Review article testifies. In one case reported in the review, six out of 8 ‘rising stars’ at an international consulting firm emphatically turned down the possibility of partnership in the firm because of what they perceived as a lack of Work/Life balance!

EOWA's interest in job design
I think EOWA's interest in the way workplaces are designed flows logically from the nature of the Act we administer.

The Equal Opportunity for Women in the Workplace Act 1999 is built on the idea that equity will only result from the adoption of positive measures to overcome the historical disadvantages encountered by women.

This is an outcomes-based approach to equity. We do not simply want to end discrimination in some superficial or theoretical sense, we want to go much further and change workplaces so that their design no longer discriminates against women.

Accordingly, the Act requires employers to develop workplace programs which identify issues faced by women in their workplaces and to propose, implement and evaluate actions to address those issues.

Since I have been Director, I have interpreted this approach to mean that we should celebrate the achievers and share the lessons through practical and accessible advice.

Our goal is to be recognised as a Centre of Excellence on Women in the Workplace. We provide information and advisory services, through engagement with our reporting organisations and through communication channels including our website.

Flexibility is at the core of redesign
Through our consultations with employers, we know that flexibility is the core issue in job redesign and therefore the core problem facing those CEOs who recognise that equal opportunity is the way to go.

Today's jobs were designed for men and they are not easily adapted to meet the needs of women, who after all, usually still bear the primary load in the home.

Designing a job to meet the needs of women means finding ways to give employees more control over how, when and where they do their work.

This is what we mean when we talk about flexibility in terms of achieving equal opportunity.

However, flexible work options do not always result in improved employment outcomes for women.

Indeed, limiting the offering of part-time work to particular areas of a business (eg. customer service) has severely limited career opportunities for women in many organisations.

Unfortunately, most Australian organisations have been very narrow, and very conservative in their approach to workplace flexibility.

Part of the problem is that employers are often fearful that flexibility measures that work for employees will cost them money and cause insoluble management problems.

This is by no means inevitable and I will mention a few case studies in a moment where flexibility works for both employees and employers.

Equal opportunity and industrial relations
Not surprisingly, the position of women in our workplaces has been a continuing challenge for Australia's industrial relations system as well as for CEOs and managers.

Almost a century ago Justice Higgins struggled with the problem of how to remunerate women in a wage system, that he largely created, that featured a basic wage designed to support a male breadwinner his wife and children.

His principal problem was not equity for women, but how to ensure that lower wages for women would not create a pool of cheap labour and threaten male jobs.

Of course, Justice Higgins' approach reflected the realities of a time when far fewer women worked.

Today's realities require a different approach and a far more comprehensive recognition of the implications for wage-fixing of a world in which women workers seek to participate as equals.

Although there have been many gains in this area, there is still a lot of room for improvement in the way awards and agreements treat flexibility.

In fact, when you look at the statistics on family-friendly provisions in awards and agreements the position is not that much different to what we see at EOWA and what came through in our census.

That is, there has been some progress but we're a long way short of seeing the sort of workplace environments required to make equal opportunity a reality.

For instance, we still have a lot of inflexibility around start and finish times that are fixed for over 70 percent of all working women and 60 percent of all working men2.

An ACIRRT study in 1998 found that only 4 percent of enterprise agreements include paid personal leave, 3 percent include job sharing, 3 percent include paid parental leave and 9 percent include unpaid personal leave.

My statistics are a few years old and no doubt, there has been further improvements in recent years - but not nearly enough.

Some good examples
Again, let me emphasise that I don't want to be too pessimistic.

While overall the Australian experience has been disappointing - there are great examples where organisations have made real efforts and real progress.

What’s very interesting and instructive is that companies which are serious about ensuring that women have an equal chance to get ahead are also often companies with very impressive industrial relations records.

Employers who create inclusive workplaces find that the benefits don’t just reach women – the whole workforce benefits.

Melbourne-based Autoliv, manufactures seatbelts and airbags.

In this traditionally male-dominated, often industrially-troubled sector of automotive parts manufacture, Autoliv has a female dominated workforce, a phenomenally low turnover and impressive annual growth.

And it has not had an industrial dispute in 10 years.

The company’s CEO, Robert Franklin, was named Leading CEO for the Advancement of Women in EOWA’s last annual Business Achievement Awards, and the company itself was named Leading Organisation for the Advancement of Women in the “more than 500 employees” category.

He's certainly a committed CEO.

But what else does it take? Identifying the scope of the problem is also crucial.

In Autoliv’s case this involved measuring female participation in various aspects of the business and where women were under-represented, setting specific targets.

For instance, currently 25 percent of managers are women, almost double the national average.

Not satisfied with that achievement, the company is working towards a target of 50 percent female managers in five years time.

Similarly, currently only 14 percent of the company’s engineers are women. The five-year plan sets the target number at 30 percent.

To achieve these targets, Autoliv requires managers to build them into their unit’s business plan. They hold quarterly reviews of performance against these targets.

They also build it into personal performance reviews. Executives are judged, in part, on their leadership performance, and equal opportunity and equal participation are seen as very strong components of leadership performance.

Autoliv has also been great at coming up with creative solutions.

Having identified that they were not attracting female engineering candidates in the numbers they wanted, Autoliv has funded a female engineering scholarship program at Swinburne University.

A lot of work has also been put into ensuring that the benefits and conditions of employment are appealing to the women the company wants to attract, and this is given strong focus in the EBA process.

Autoliv has implemented paid maternity leave, carers’ leave, flexible starting times and an early knock-off on Fridays plus one RDO a month.

As you can imagine, some of these took quite a bit of work to make happen. Staggered start and finish times in particular is a real challenge for a manufacturing organization. But a lot of effort was put into making it work. There also are various other uncommon benefits for employees such as 100 percent income protection insurance, a funeral benefit for employees or their family members, and a crisis fund for people who have family emergencies and need to travel overseas.

These are innovations that come from effective staff consultation—from asking employees what exactly they would like and then examining the business case for each.

The result of all of this is very high morale and impressive performance statistics: annual staff turnover of less than half a percent, absenteeism of less than 3 percent, business growth of 20 percent annually and no IR disputes for decade.

For the CEO the overriding philosophy couldn’t be simpler. What he says is, “We’re really trying to make ourselves an employer of choice in order to attract the best people.”

Another company leading the way on equal opportunity for women in Australia is Sara Lee Household & Body Care.

This is headed by another CEO, Stephen Goodey, who is both devoted to bringing about real change in this area and who sees diversity and equal opportunity as providing a business advantage.

He explains it is by saying, “The size of our business means we need to keep good people - particularly women, who after all are the majority of business graduates - that we otherwise might have lost.

We simply couldn't afford to recruit and retrain replacements. It’s also a competitive scenario - if we can position ourselves as an employer of choice by embracing diversity, that will give us an edge in the marketplace.”

In order to achieve that Employer of Choice status, Sara Lee Household and Body Care has introduced many of the same innovations as Autoliv: flexible working hours, paid maternity leave and targets for female recruitment that must be met.

Again, we also see the importance of accountability in meeting these targets. In Sara Lee’s case the target for women in senior management is 50 per cent, and both the CEO and HR manager’s performance bonuses are linked to meeting this goal.

The company’s excellent performance in terms of equal opportunity saw it named Leading Organization for the Advancement of Women in the “less than 500 employees” category in our Business Achievement Awards.

Conclusion
These are just two great CEOs leading extraordinary changes in their companies.

While the overall picture is gloomy, the individual examples of excellence are there to inspire anyone.

If we can inspire a lot more CEOs we will generate benefits for women, for their families, for the businesses that employ them and for the society that invested in their education.

The changes we need to make our workplaces women-friendly won't happen by accident nor will they occur automatically and in the fullness of time.

Change requires leadership and expertise. EOWA, in partnership with a growing number of visionary CEOs, is helping to generate some of that much needed leadership and expertise.

With these great workplace examples in mind we are confident we can accelerate the pace of change.

Thank you.

1. These statistics are from a speech by Sharan Burrows, ACTU President
2.  ABS 6342, 1997.

END OF SPEECH

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