Download - Women for Growth Unlocking the full potential of women in the … · McKinsey & Company | 3 Companies in the top quartile for the women representation in executive committees Companies

McKinsey & Company | 0

Women Matter January 17, 2019


Why diversitymatters

Where westand today

What we learned at McKinsey

What could this mean for

you?


Our research on diversity

Local perspectivesGlobal proprietary researchand strategic partnerships


Companies in the top quartile for the women

representation in executive committees

Companies with 0 women in executive

committees

15%

22%

+47%

Average return on equity2007-2009

17%

11%+55%

Average EBIT margin2007-2009

Diversity and financial performance


42

67

Quartile 4 Quartile 1

50

53

45

61

43

61

SOURCE: McKinsey; Diversity Matters

Diversity and financial performance

Percentage of companies with EBIT performance above the median

GenderRegion Ethnicity


Direction

+6 pts

Coordination &

control

+5 pts

Innovation

+3 pts

Motivation

+1 pts

Work environ-

ment & values

+7 pts

Capabilities

+1 pts

External

orientation

+5 pts

Accountability

+1pts

Leadership

team

+4 pts

Companies with 3+ women on their boards have better results on organisational performance

McKinsey & Company | 6SOURCE: McKinsey; Diversity Matters

Win the war for talent

Improve the quality of

decision making

Increase customer insight

Motivate employees and

increase satisfaction

reasons why we believe diversity impacts performance


Human capital

Government regulation

Operational excellence

Innovation

Customer relationships

Global expansion

Global political/economic risk

Corporate brand and reputation

Sustainability

0.9

Trust in business

2.4

2.1

2.0

1.7

1.7

1.6

1.3

0.8

0.5

The Conference Board 2013, 2014

CEO Challenge

SOURCE: McKinsey & The Conference Board research, 2012; The Conference Board CEO Challenge 2012, 2013, 2014

Human Capital is the number 1 CEO Challenge globally

Human capital is the Number 1 CEO challenge globally

Ignoring half the pool of human talent just doesn’t make good business sense.”

McKinsey & Company | 8SOURCE: ‘What makes teams smarter,’ Harvard Business Review, June 2011

Little correlation between a group’s collective intelligence and the IQs of its individual members.

But if a group includes more women, its collective intelligence rises.”

Diverse teams are more intelligent


Frequency gap in types of behavior between men and women1

PercentTypes of leadership behavior

Women bring something different to the equation

SOURCE: McKinsey; Women Matter

7

4

4

1

1

4

9

Role model

Control and corrective action

People development

Expectations and rewards

Inspiration

Participative decision making

Efficient communication

Individualistic decision making

Intellectual stimulation Not statistically significant

Not statistically significant

Women apply more

Women apply slightly more

Women and men apply equally

Men apply more


Role of women as customers is growing

SOURCE: McKinsey & Company (2013), Women Matter: Moving Corporate Culture, Moving Boundaries; University of California, The Williams Institute

(2013), The Business Impact of LGBT – Supportiev Workplace Policies; Center of Talent Innovation

80% of consumer purchase

decisions made by

women

60% of all personal wealth is

expected to be women-

owned by 2025

In the UK…

Companies are making changes to reflect their customer base

370%growth of female

executives

Women will control

£400m more expenditure per

week than men

McKinsey & Company | 11SOURCE: The 2013 Digital Marketer Report, McKinsey iConsumer 2013, Universum

Diversity plays a key role in motivating talent

Millennials want to work for diverse organisations

A poll of UK students:

80%felt it was important that the

employer “engages in creating a

diverse workplace.”



Where westand today



you?

McKinsey & Company |

We’ve made some progress but still enormous opportunity

Share of women, Percent

Executive

committees

2018

Board members

2018

25 241916

4136

1626

15

22


Women are under-represented at all hierarchical levels, not only top management

1 Companies with more than 10,000 employees and/or revenues greater than €1 billion, and that provided data

EMEA industriesNumber of companies= 1301, percent women

Odds of advancement for

men over those for womenXx

SOURCE: McKinsey, Women Matter

CEO Seats on

executive

committee

Senior management

and vice

president

Middle

management

Entry level

2% 9% 14% 22% 52%

5x2x

2x

3x<

McKinsey & Company |

Diverse members of executive teams are more likely to be in staff versus line roles

Women

executives are

under-

represented in

line roles, and

may face a

harder path to

CEO

1 Sample includes 341 companies with 872 female executives

SOURCE: McKinsey Analytics; Company websites; McKinsey Diversity Matters database

Female executive roles by ethnic/cultural minority1

Percent

Asian

Hispanic

Black

White

Other

54%

35%

34%

20%

47%

21%

46%

65%

80%

66%

53%

79%

Ethnic/cultural minority

Line rolesPercent

Staff rolesPercent

Share in women on executive team Percent

70%

12%

8%

7%

2%


Number of companies = 1301

Each sector has its own challenges



11

Consumer goods

18

50

30

9

Financial services

22

13

49

9

17

Media, telecom, technology

34

20

10

Transport, logistics, tourism

27

19

15

Energy and basic materials

11

15

16

25Total company

Middle management

Senior management

and vice president

Seats on executive

committee

http://www.youtube.com/watch?v=QiCOmqvWUaw


What’s going wrong ?


Female managers appear equally ambitious as men but are less confident that they can reach top leadership positions

SOURCE: Women Matter: Time to accelerate, 2017

1 McKinsey Quarterly Global survey of 1,400 executives

Share of female and male managers agreeing or strongly agreeing1, Percent

Senior-level managers Mid-level managers

69867981 6164 5876

I am confident I will succeed in reaching a top management position

Senior and mid-level

managers

I am willing to sacrifice a part of my personal life to reach a top management position

Senior and mid-level

managers

Over the course of my career, I have the desire to reach a top management position (e.g., a role in the C-suite)


22% 24%

26% 28%

Where are companies today?

20%

52% companies48% companies

Percentage of large companies

N=821

1 Companies with >EUR 1bn revenues or >10k FTE headcount.

SOURCE: McKinsey Women matter survey 2016

10 30

70

0 5 2515 3520 40 45 500

Number of measures

Percentage of women CEO or n-1

have implemented

less than 25 measures

have implemented

more than 25 measures


22% 24%

26% 28%


Limited

diversity

practices

Investing in

diversity, but no

impact yet

20%



N=821



200 5 15 302510 35 40 45 500

70


Number of measures

have implemented


have implemented



22% 24%

26% 28%


Operating with

a diversity

advantage

Limited

diversity

practices

Investing in

diversity, but no

impact yet

20%


Making

progress

with diversity


N=821



10 25150 5 20 30 35 40 45 500

70

Number of measures


have implemented


have implemented



Looking at Best-in-class companies (i.e., with a woman CEO or 30% of n-1 are women) we identified 3 game changers

Focus next pages

Best-in-class companies have initiated holistic change programs

▪ 68% of best-in-class companies (vs. 49% of other companies) actively support and

nurture a gender diversity culture

▪ 60% have a compelling change story

▪ 48% have role models and change agents embracing diversity

Best-in-class companies started to work

on gender diversity and show passion and

persistence over time

CEOs of best-in-class companies have

gender diversity as a strategic priority and

cascaded it at all levels

1 2

3

Persistence CEO commitment

Holistic change programs

SOURCE: Woman Matter 2016


RECRUITING

PROMOTION

RETENTION

Organization de-biasing

Women’s leadership development

CEO commitment & management cascade

Transparency and indicators tracking

WORK-LIFE BALANCE MEASURES INFRASTRUCTURES

HR processes and policies

Collective enablers

Training and coaching

Sponsorship and

mentorship

Women’s networks

On-the-job de-biasing

Evolution of leadership

styles

Evaluation and recruitment

de-biasing

A holistic programme is required to make change happen

SOURCE: McKinsey Women Matter


It is possible to make rapid improvement on diversity

60%

50%

33%

32%

13%

30%

16%

Increase in women’s representation on executive teams2014 – 2017, %

Increase in ethnic representation on executive teams2014 – 2017, %

47%

14%

22%

46%

21%

29%

26%

SOURCE: McKinsey Diversity Matters Database



Where westand today



you?


Our women’s initiative


We were falling short of our fair share in recruiting and retention was a MAJOR issue

Maternity and flexibility were key challenges

The external environment played a major role

We saw the power of a great mentor and sponsor but also that fewer women had them

Many things were no surprise


Maternity – whenever that happened

Mid-tenure – looking up at Partner and trying to decide whether to go for it

Mid-tenure partners –looking up at Senior Partner and deciding whether to go for it…

There were a few surprises…3 critical moments of truth


There were a few surprises… our senior women weren’t leaving for the lifestyle – UK example

Jane FraserCEO of Citi, LatAm

Margo GeorgiadesPresident Google

America

Elane StockGroup President

Kimberley Clark

Charlotte HoggCOO, Bank of

England

Helen WeirCFO Marks & Spencer

Diana LayfieldCEO Standard

Chartered – Africa; VP

– Next Billion Users

(Google)

Wendy BeckerCEO Jack Wills

Sue WhalleyCOO Royal Mail

Gioia GhezziChair – RGI Group

Dido HardingCEO of TalkTalk, Chair

– NHS Improvement

Natalie CeeneyCEO HM Courts

Jenna LittlerSVP Marketing,

Burberry


Outside of the UK… a few of the women who left

Sheryl SandbergCOO, Facebook

Susan RiceNational Security

Advisor, White House

Claudia NematManagement Board,

Deutsche Telekom

Keiko HondaEVP and CEO – MIGA

at the World Bank

Sandy PetersonGroup Chairman,

Johnson & Johnson

Katrin SuderSecretary of State,

Ministry of Defense,

Germany

Alison WatkinsCEO Coca-Cola

Amatil

Chelsea ClintonVice Chair, The

Clinton Foundation

Kathleen McLaughlin

President, Walmart

Foundation

Christiana ShiPresident, Direct to

Consumer, Nike, U.S

Melanie KreisPersonnel & Labor

Director, Deutsche

Post DHL, Germany

Rebecca WeiPresident, Asia,

Christie’s

International, China


Community Maternity/

flexibility

Skill

building

Mentorship

and

sponsorship

Role

models

2. Progression and retention

1. CEO agenda

So what did we do?

SOURCE: McKinsey; Women Matter

5. Engaging the men (unconscious bias training, external research)

4. Foundations (metrics, HR policies, performance dialogues)

3. Recruiting


We have also started to change our model

▪ Functions or industries

▪ Special initiatives

▪ McKinsey Global Institute

▪ Secondment programs with world-

renowned organizations

▪ Mobility options across our 105 global

offices

▪ Including different paths (expert, RTS,

McKinsey Implementation)

▪ Also different roles knowledge, people &

operational roles

▪ ‘Take Time’

▪ Various flexible part-time programs

▪ PACE program

▪ Leaves of absence

More diversity in expertise

More options on career paths

Greateroptions for mobility

More flexibility on timing and “Up or Out”


Overall, we have made significant progress –increase in women in EMEA since 2007

Directors

+400%Partners

+56%Associate

Partners

+70%

Engagement

managers

+50%Associates

+28%Business

analysts

+19%

Overall

+38%


…with pockets of excellence…

Women in global Organization practice – 2019

40% global leadership team

60% new partners 2017 & 2018

52% project managers

>50% practice consultants


Leadership - from both the most senior men and the most senior women

A truly inclusive culture that celebrates and champions diversity in all its forms

A holistic program including a ‘segment of one’ approach and tackling the key ‘moments of truth’

Constant focus, passion and persistence over time

What makes the difference?



Where westand today



you?