Why it’s time to stop talking about gender diversity in tech – and ACT!
Following Founders Forum's inaugural Accelerate Her event, Startups delves deeper into the issue of female under-representation in business...
There are currently more CEO's named Peter and David in the top 2,500 European technology businesses than there are female directors and CEOs in the top 2,500 European tech businesses.
While startling, this statistic (presented by McKinsey senior partner Kate Smaje) helps contextualise the current state of the gender gap in the tech industry. It also explains why over 180 senior business leaders – female and male – came together at the inaugural Accelerate Her event to address this very issue.
Hosted by Founders Forum – the organisation led by Brent Hoberman CBE – the Accelerate Her conference focused on the under-representation of women in tech and business and was attended by leading names such as Trainline CEO Claire Gilmartin, TV presenter Davina McCall, and Google UK director Eileen Naughton.
Starting with a special address from Sheryl Sandberg who told the audience to “break down the barriers that hold women back”, the event evolved into a debate of key issues and actionable targets that could be implemented to improve gender issues at play.
What was made clear from the event was that while gender diversity is by no means a new problem, it is about time that we started answering questions to solve it.
With this in mind, Startups.co.uk – a champion of women in business – has shared key take-away points from the conference to provide some much-needed food for thought…
Gender divide: The facts
Discussing the gender gap, McKinsey's Smaje told the audience to imagine a world in which there is full gender parity – where women participate in labour markets identically to men and have an equal share of leadership positions, a mix of skills, and where the pay gap is closed.
Based on McKinsey's calculations, moving to full gender parity in business and workplaces could produce up to $28 trillion or 26% in additional global economic output in 2025; equivalent to the size of the current US and Chinese economies today combined. In the UK, that number is £600bn.
“Full gender parity could produce
an additional $28 trillion”
Smaje then went on to explain that if all countries aimed for best in class and matched the country in their region with the fastest historical progress towards gender parity, an additional £200bn could be added to UK GDP in 2025.
For instance, if Switzerland has the best statistics for equal employment and the best progress in achieving gender parity, then all other countries in the EU should work to be as good as Switzerland.
The disconnect between brands and the female audience
Given the economic value of closing the gender divide, as highlighted in the statistics above, you would think that businesses and brands would focus more of their efforts on connecting and resonating with female consumers. Apparently not.
According to Jane Cunningham, author of Inside Her Pretty Little Head, “businesses are missing out on the huge size of the commercial prize” and it was explained that there needs to be more female founders to create businesses because female founders are more “uniquely placed” to understand the female audience.
“Female founders are more uniquely placed
to understand the female audience”
Based on Cunningham's research, women are, in almost every category, in almost every developed company, the biggest growth market. Globally, women control $30 trillion in annual consumer spending – an aggregate that means women represent a growth market almost three times the size of China and India's GDP put together.
In almost all products and service categories, women are now the major decision makers even, and especially, in categories that were once deemed to be primarily masculine, such as automotive, financial services, technology and so on.
“Women represent 80% of the decision-making
in marketplaces yet men represent about 80%
of the decision-making in businesses”
Highlighting figures from the World Economic Forum which have shown women now control two thirds of spending worldwide, Cunningham said: “Despite these overwhelming figures we still have this situation where women represent about 80% of the decision-making in most marketplaces yet men still represent about 80% of the decision-making within most businesses.” This arguably wouldn't matter too much but Cunningham's evidence suggests that businesses, traditional ones at least, still struggle when it comes to connecting with the female audience:
“In a recent study, 91% of women said they did not feel that advertisers understood them and 67% said they felt alienated by the advertising they had seen. There's a huge, and really unreported, disconnect between the massive value of women as an audience and traditional business' ability to meet it.”
“Our thesis on why [there is a disconnect between brands and consumers] is simple but not necessarily easy. If an organisation has an unbalanced profile of women and men and has more male decision-makers than female then the business will usually entirely, and unconsciously, prioritise and over-invest in things that men prioritise and will neglect or underplay the things that women prioritise.
“Businesses unconsciously prioritise
and over-invest in things that men prioritise”
“The […] result of this bias is the prioritisation of techniques and systems development over insight when it comes to R&D, competitive differentiation over creating communities that have shared interests, and focusing on features over aesthetics.
“In communications, there seems to be a tendency for hyperbole and rhetoric over empathy and connections. You get a lot of big and superlative claims as opposed to small, close connecting claims, you get a lot of focus on the text and not a lot on the sub-text. At it's most extreme. you get businesses and brands where the system and the machine becomes the driving force rather than the customer.”
Encouraging more female founders
Summarising the reasons as to why more women need to be motivated to start businesses, Cunningham explained that her research showed that businesses with a more balanced decision-making profile – where women are as, or more, central to the decision-making – are seen to be “much better at understanding and connecting to their audience, more empathetic, and better at understanding people”.
An opportunity for start-ups to take the lead
This issue of gender diversity is where start-up companies and smaller tech businesses can make their mark and change things for the better.
As Cunningham suggested, traditional businesses are still struggling to connect with women. When compared to these larger “traditional” companies, start-ups have the means to become a driving force for gender diversity and can change the gender make-up of their workforce faster and with fewer complexities.
“Start-ups have the means to become
a driving force for gender diversity”
How? Start-ups have more flexible board compositions while larger companies often have a greater number of board members and typically demand more experience from their board members. Due to years of being overlooked there are fewer women who have experienced life at C-Suite level and would, therefore, match the experience of existing board members.
Start-up businesses also have the ability to hire more female leaders in a shorter space of time as hiring processes are often far less complicated and time-consuming than that of bigger brands. By placing more women in positions of authority, other women will follow – diversity will build diversity. Sheryl Sandberg alluded to this point when she said ‘women cannot be what they cannot see'.
It's not just a one-sided argument for start-ups to hire more women and close the gender gap though. To put it simply, the dynamics that women bring to the fore are integral to any start-up's success early on.
“Women are assets for any
In an article published by The Muse, it was argued that women have higher social sensitivity and empathy (useful for collecting ideas and relating to consumers), are able to balance the “silent power struggle” with men, and are typically more detail-orientated, comprehensive and pay more attention to detail; all huge assets for any start-up business.
Gender divide: Solutions?
We've looked at the key gender issues at play; in the workplace, in business and in the way that brands market to female consumers, and we've seen that start-ups have the upper hand to bring about change. Yet it can't just be left to start-ups to help bridge the divide.
So what then can actually be done to resolve the problems?
Following a brainstorming session, the Accelerate Her entrepreneurs suggested four key areas that could be targeted in a bid to improve gender diversity in business, particularly in tech.
These were the following:
- Flexible working – Women should be encouraged to ‘dial up or dial down' their working hours according to family commitments. Both men and women should also be appraised on what they want to achieve in their lives, not just in the office.
- Internships – There should be paid adult internships for older women, as well as coding classes, for this hugely powerful demographic that have valuable insights to offer to companies.
- STEM skills – The government needs to revise the UK's IT curriculum to inspire young women and encourage them to pursue STEM subjects.
- Investors – Existing female angel investors should partner with support organisations to raise awareness of the lack of female investors in the space and promote career opportunities.
Other ideas included tackling the ongoing issue of childcare and providing crèche facilities within the workplace.
Where do we go from here?
Concluding the event, Founders Forum co-founder Henry Lane Fox said that the “clout in the room” could be used to implement these “practical, actionable solutions” and announced that there would be another meeting next year to review the progress of helping to close the gender gap.
But it's not just the Accelerate Her attendees that are driving change for gender equality. Last month, Facebook launched an initiative to help more women start businesses in the UK and last week the Federation of Small Businesses (FSB) called on government to help support female entrepreneurs in Wales.
There's a long way to go until we'll see equal female representation in business, and change to the ‘Peter/David divide', but more than anything we need to stop looking at gender diversity as merely a topic of rhetoric.
As Smaje explained: “This is a chance to move away from the ‘Oh my God this is such a terrible situation!' to the ‘Well what the hell are we going to do about it?'”
We want to continue this conversation about gender diversity in business so please share your views on the issues above in the comment section below or Tweet us @startupstowers