The data-centric consulting firm, which was rated by Fairygodboss’ users as the Best Company for Women in 2017, is passionate about using its numbers savvy to research topics related to gender equality. And on Thursday (Nov. 2) at the inaugural Fairygodboss summit, “Galvanize,” BCG chose to shed some added light on the value of diversity programs.
Right off the bat, the BCG team — Michelle Russell, Senior Partner & Managing Director; Lissa Filose, Principal and North America Diversity & Inclusion leader; and Katie Abouzahr, Principal and BCG Fellow — dove into the stats. And their research did not disappoint.
According to research from Catalyst and the Peterson Institute, if Fortune 500 companies have at least three female executives, they will see a 53% increase in return on equity. Companies with three female executives also see a 42% increase in sales. And when company leadership roles are made up of at least 30% women, a 6% increase in profit margins is also found.
So, based on these numbers alone, it just makes sense to hire more women.
They also very quickly dispelled myths about ambition that often cling to women, especially once they start families. In fact, in their research, the BCG team found that women are just as ambitious as their male counterparts at nearly every stage of their careers, and that having a child or starting a family has absolutely no impact on their ambition. Take that, stereotypes!
Given that women do, indeed, maintain equal ambition to men and lead to a greater profit, it should be common sense that companies choose to first hire women and then continue promoting them throughout their careers. Right?
Unfortunately, this isn’t necessarily the case.
"Women aren’t shattering the glass ceiling,” Russell said. “They’re getting in the door — they’re just not staying and not advancing in their careers.”
“We’re spending millions on [diversity] intervention and ERGs, but is the needle moving?” she said.
The group then moved to a study they conducted about the ineffectuality of diversity programs across the United States, showing the discrepancies in the wage gap depending on whether or not a company was running a working diversity program. The survey included 3,500 participants — and the results were quite glaring.
According to their research, 91% of the women surveyed said that their company did have a diversity program or training in place. That was good news, until they got to the answers for their next question. Only 27% of these women said that they personally benefited from these programs.
It was also extremely telling that the companies with working diversity programs had a wage gap of 2%, while those whose diversity training effectiveness ranked toward the bottom had wage gaps in the double digits.
So, what’s the point in having a diversity program if such a small percentage of the workforce is actually benefiting? That’s where changing tactics, and turning to the budget, comes in. Because there are obviously some underlying discrepancies creating this divide.
One major discrepancy is that men and women seem to see different obstacles when it comes to the workplace. For women, these obstacles are seen as advancement, retention, movement into leadership roles, and company culture. For men, the main obstacle they perceived was recruitment — which was considered the smallest obstacle by women themselves.
“When companies invest in company culture, (these) gender diversity gaps are much smaller,” Katie Abouzahr explained.
That’s why a key portion of diversity training should come down to gender diversity initiatives — educating employees and giving them the discussions they want to have, the BCG team explained. The group also found that all employees, both men and women, under 40 all consider flexible work a motivating factor, meaning that companies should start looking for these points of interest and working with them.
Finally, they found that when men were championing gender diversity, 97% said their diversity programs saw progress. When they remain outside the conversation and don’t make diversity a priority, however, only 39% see progress. That’s why it’s important that men and women at all levels get involved and make changing the workforce a necessity, Russell explained.
“When you have the kind of mentor program where you’re assigning people, that’s where we find it doesn’t make a difference; formalized programs aren’t as helpful as sponsorship and advocacy programs," she said. “The world is moving, and moving relatively quickly, so we have to find a way to move along with it."