Companies taking action for gender equality see lower staff turnover, more women in leadership and better shareholder value.
This is according to the 10th report in the Gender Equity Insights Series from Bankwest Curtin Economics Centre (BCEC) and the Workplace Gender Equality Agency (WGEA), which warned that businesses could fall behind their competitors if they don’t take strong action to address gender balance.
Here, the researchers investigated what drives gender balance (i.e. having at least 40% women and 40% men in the workforce), and they found that higher resignation rates for women is a key factor shaping whether companies move towards, or away from, a gender-balanced workforce.
As a result, it will be harder for businesses that don’t address it, to reach gender balance. Nonetheless, companies that take proactive action – like setting goals for pay equity, doing a regular gender pay gap analysis, and making leadership roles more flexible – see fewer women leaving and more women moving into management.
The new findings are drawn from WGEA’s world-leading dataset of Australian employers, covering more than 5.1 million workers.
BCEC Director and report author, John Curtin Distinguished Professor Alan Duncan, said the research showed that workforce gender equity is a story of both progress and fragility.
“Gender balance is not just a fairness issue, it’s a sound financial strategy,” Duncan said. “Organisations that invest in equity strategies not only close pay gaps, they also build stronger, more resilient workforces. By contrast, those that fail to act will continue to lose talent, eroding leadership pipelines.”
The research highlighted that gender equity and better company performance go hand-in-hand. It similarly showed that gender-balanced executive teams deliver higher company value – e.g. for a $1 billion ASX-listed business, this equates to around $93 million on average in added company value and up to $120 million depending on the existing leadership gender balance of the organization.
The findings build on existing evidence that diverse leadership teams foster improved innovation, better decision-making, and have a stronger capacity to navigate economic shocks.
According to WGEA CEO Mary Wooldridge, every employer could secure benefits from addressing gender equality, starting with a gender pay gap analysis. “The evidence is clear that gender-balanced leadership teams don’t just support women, they also deliver stronger results by fostering better decision-making, innovation and capacity to navigate challenges… This research points to the benefits that flow to those employers that choose to embed gender equality into their business strategies.”
The report also investigated pay gaps within an organization, between women and men doing jobs at a similar level, but that have different salaries – also known as ‘horizontal pay gaps’.
It found many roles are now within 5% of parity, suggesting that other structural issues – like occupation segregation across roles and industries and sector-wide pay differences – remain more dominant factors driving gender pay gaps.
The report also found that, although service industries, such as arts and recreation, accommodation and food, and finance are showing positive gains in gender balance, across all industries just 27% of employers have a gender-balanced workforce.
Boards are edging closer to parity, but gender balance in leadership is still rare (only 1 in 4 employers).
The report set out a clear agenda for employer action including by tracking and addressing resignation patterns, embedding accountability for leadership balance, redesigning pipelines for women into traditionally men-dominated roles and men into women-dominated roles, and normalizing flexibility in leadership roles.
“Gender equity and business performance go hand-in-hand,” Duncan said. No one can “afford complacency. Employers who take deliberate action will not only retain women and strengthen leadership pipelines, they will also secure long-term value, innovation and competitiveness.”
