Do the maths: insurers encouraged to examine workforce diversity on IWD
Insurers are encouraged to take a deep dive into their own workforce metrics to address diversity blockages that reflect biases and may be hitting the bottom line.
In an interview to coincide with International Women’s Day, McKinsey Partner Violet Chung says it is crucial to crunch the numbers and track the composition of teams, and who is being hired, promoted and given C-suite roles.
“It sounds really geeky and scientific but it is actually extremely important, because when you do the maths, then you realise which part of the funnel is actually breaking down,’ Ms Chung tells insuranceNEWS.com.au.
McKinsey research shows for companies with a balanced C-suite, the return for shareholders is likely 20-25% more than those that are not as balanced.
“That just tells you diversity does matter,” says Hong Kong-based Ms Chung, a financial services consultant who advises insurers across Asia-Pacific.
“The fundamental thing to crack through is that executives and boards understand that diversity brings benefits. Unfortunately, not everyone recognises that but I think it is starting to change and that needs to be the first conversation.”
General insurance has a gender pay gap of 24.7% – down substantially from 30.4% in 2015 but still wider than Australia’s all-industries gap of 22.8%, the Workplace Gender Equality Agency (WGEA) says, with 15% female CEOs (up from 6% in 2015), 34% female key management personnel and 26% female directors.
CoreData says women’s retirement funds are impacted by breaks from paid work due to family responsibilities and working part-time or in lower paying industries.
Deputy MD Kristen Turnbull says the financial services industry could help with financial education for women, compulsory financial literacy education in schools and scrapping “patronising communications”.
Insurers worldwide recognised IWD today, with QBE Group CEO Andrew Horton saying it is an opportunity to reinforce commitment to the inclusion of diversity, reflect on progress made and be sure the right plans are in place to “create a more equal industry and a better world”.
“Our approach to gender equality at QBE has been built on bold actions to accelerate the representation of women in leadership positions and we’ve actively worked to remove the systemic barriers to women’s career development,” Mr Horton said.
“We acknowledge there’s more to do and we know further success is dependent on our sustained commitment.”
In New Zealand, Tower says it values transparency and has joined the Mind the Gap initiative, the first national public pay gap registry. The insurer says across the vast majority of roles at Tower, men and women are paid about equal wages.
“We’re extremely proud of this and will continue towards getting more women into leadership roles,” it said.
Marsh Assistant VP FINPRO Karen Lee says as a woman pursuing career development, she was worried about being labeled as too aggressive, but in recent years she has met more inspirational women leaders who are “kind and friendly”.
“They have been vivid examples to me that there is nothing wrong with proactively managing your career no matter what your gender is. Instead, it is your traits and the way you get along with people that are more relevant,” Ms Lee said.
“Although having bias seems inevitable, it is important we are aware of its existence and consciously remind ourselves not to make quick decisions based on it. If you do not want to be labeled, do not label others.”
McKinsey has worked hard to see that its women leaders have “more of a stake in the ground,” Ms Chung says, conscious that women account for 1 in 15 entry roles – but in the C-suite it is just 1 in 50.
She says gender ratios and recruiting practices are scrutinised for bias, and since last year, each Partner is evaluated to see what juniors they are supporting, what the gender mix is and the roles assigned.
“You start to see which part of the fabric is not working quite as well and you can look deeper and do some work on that,” she said. “That’s something we do very aggressively and I think that is important because if you don’t have that, it is very hard to know which part of the engine to change.
“It is very mathematical but that is super important – that people who do good work are being recognised in the metrics. If you don’t make any changes on reviewing metrics then things don’t change.”
Ms Chung noted more C-suite women represented across the insurers in the region, a big change since she started out.
“It is starting to change and it is quite encouraging. There are already quite a few senior executives that are women and some who are the CEO – that I think is very, very refreshing and we are starting to see more of that but there is still room to grow.”
