The multiplier effect: why presence matters for female leadership
4 Minute Read
For every woman added to the C-suite in an organisation, three women rise to senior leadership roles.
Known as the multiplier effect, this phenomenon was identified by research from Deloitte’s Within Reach studies into women in financial services. Research also shows that firms with women in the C-suite have almost double the number of women board members than those that do not.
The multiplier effect is crucial in addressing the ongoing gender imbalance in leadership. This is vital when we consider how few women have been appointed to executive roles – in financial services and every other industry. In 2021, the proportion of women in leadership roles within financial services firms was only 24%. There were just 14 female chief executives among Australia’s top 200 companies – up from 11 in 2017. And shockingly, 47 of the ASX 300 companies still have no women in their leadership teams.
Progress to parity is painstakingly slow and it’s staggering to learn that the number of women in the C-suite is still so low. But on the positive side, the presence of even a handful of women has an outsized impact on the progress of their peers into leadership roles.
On International Women’s Day we look at four reasons not to give up hope that there are ways for more women to secure the pay and career status they deserve.
- Australia is doing better than most
Australia has already made measurable progress in advancing gender diversity in leadership roles and stands out as the country with the highest forecasted share of women in the C-suite (35.7%) by 2030. Legislation that will make gender pay gap reporting mandatory for companies with 100 or more employees is currently working its way through Federal Parliament. In simple terms regulation that requires a data driven approach improves transparency on objective measures of progress. It also moves pay equity and equal opportunity for women in leadership up the agenda for Australian employers.
- A competitive job market is helping women
In a bid to attract talent in a competitive job market, some employers are already taking the initiative on pay transparency. Last year PwC announced their salary ranges for employees at all levels. This type of disclosure helps all employees, current and future, understand what they should expect to be paid. For women, this can help them get clear on what they’re worth and set their sights on a role and reward that matches their skills, experience and career potential.
- Paid parental leave is improving
Australia might not set the global standard for paid parental leave (PPL) but the situation is set to improve. In October 2022, the Federal government announced an incremental increase in statutory PPL from 18 weeks to 26 weeks by July 2026. Supporting women with more paid time off work can help them balance work and family responsibilities with less impact on their career goals and their chances of securing a leadership role.
- Women are taking the reins as independent leaders
Research by Accenture and Xero suggests more women are stepping into leadership by taking charge of their own businesses. Rather than relying on the corporate ladder for financial reward and recognition, women are taking matters into their own hands. In an analysis of the post-pandemic small business boom in Australia, the report reveals that 36% of small business owners are women, which is a 40% increase since 2001.
Obstacles and barriers to advancement still exist but policies are starting to change the experience for women at work. As women become visible at the leadership level in greater numbers, we look forward to seeing more women moving into the top roles in listed companies and elsewhere.