PWC ANNOUNCED RECENTLY that it wants to set targets to radically increase the number of women and ethnic minorities at partner level within its organisation over the next decade. From its current figure of 14% it has suggested a target figure of 20%, but with an aspirational goal of 40%-50%. They insist that this will not be about positive discrimination, but about focusing on its leadership programme and encouraging women back to work after maternity leave.
The announcement came ahead of Lord Davies’ planned publication of a report, commissioned by Vince Cable, setting out recommendations for promoting gender equality on the boards of listed companies. It is thought unlikely he will recommend quotas, but will encourage voluntary change. However, EU legislation may be barking at the heels of the government and insisting on targets if the numbers don’t improve. Already, EU Commissioner Viviane Reding has stated that, unless boards improve their numbers voluntarily, they will create legislation mandating that 20% of board members must be women.
So the consensus for improving the representation of women and ethnic minorities at senior levels in this country, for the moment, is targets not quotas. But will they work?
To consider this, we should first look at what makes diverse representation at the senior level in the accountancy professions so poor. After all, there doesn’t appear to be a problem at recruitment level. The large accountancy practices are some of the biggest graduate recruiters in the country and the statistics show a fairly even match of male and female recruits, with the ethnic minority figure being higher than across the general population. However, at more senior levels, only 23% of partners are women and 5.9% ethnic minorities with women making up only around 15% at the Big Four. And, if you look at the boards of directors, they are predominantly made up of white men. So why the big drop off?
The following are likely to be some of the key reasons:
* Partnership promotion processes which are focused on bottom line results. Why can’t partnership be focused on a more qualitative assessment rather than a quantitative one? Partnership shouldn’t be about the number of hours spent chained to the desk, but about the value that an individual adds to the practice. If the number of hours billed is the main focus for partnership, then women returning from maternity leave, who are less likely to want to spend hours in the office for the sake of being there, will find it harder to win promotion. Working part time should not be a barrier to partnership.
* People like people who are like them. No matter how objective interviewers try to be, if the interviewers are white and male, then they are statistically more likely to select those who are white and male. In many practices, you don’t have a chance of being made a partner without a number of senior sponsors supporting your application. Again, if the sponsors themselves are not diverse, those they sponsor are less likely to be.
* Lack of role models for women and those from ethnic minorities. If women or those from an ethnic minority see very few people like them are promoted, it is likely to discourage them from trying.
* Those who push themselves forward have a greater prospect of being made partners in the current environment. It has been shown that women and those from ethnic minorities tend to be less likely to blow their own trumpet or to self-promote. They may require someone to recognise their talent and push them forward. Alternatively, they should be taught or encouraged to do so.
The reality is that these firms need to move their focus away from achieving diversity in recruitment, where they have obviously succeeded, and into career progression – which is something that may require a lot more work. Achieving real diversity will require a cultural shift across all aspects of the organisation. For that reason, setting targets alone will not begin to work without an education process across firms to teach staff about the benefits of a diverse workforce and the way in which the system, at present, inhibits it.
If there is a real will to achieve it, it can happen, but only if the drive for it comes from the top.
Julie Morris is employment partner at Russell Jones & Walker
Paul Eagland speaks to Accountancy Age ahead of taking the reins as BDO managing partner in October
Paul Eagland will replace Simon Michaels as BDO's managing partner on 1 October
PwC elects Kevin Ellis as its new chairman and senior partner in the UK and Middle East
Former CIoT president Stephen Coleclough was sentenced to 14 months in prison, suspended for two years.