Executive Women in the Workplace Inquiry Building the Executive Pipeline of Talent

EVIDENCE Mary Macleod MP and Dr Thérèse Coffey MP

Conservative Women’s Forum Sponsored by June 2013 Contents Contents

Corrected Oral Evidence - Session 1...... 3 Monday 21st January 2013 Nigel Whitehead, Group MD Programmes & Support, BAE Systems PLC Marjorie Strachan, Group Talent, Royal Bank of Scotland Group PLC Anna Fullerton-Batten, Talent Acquisition Lead, UK Staffing Team, Microsoft

Corrected Oral Evidence - Session 2...... 26 Tuesday 22nd January 2013 Kate Grussing, MD, Sapphire Partners Karoline Vinsrygg, Consultant, Egon Zehnder International Charlotte Crosswell, CEO, Nasdaq OMX NLX Rebecca Salt, Group Communications Director, Balfour Beatty PLC Jill May, former MD, UBS

Corrected Oral Evidence - Session 3...... 62 Wednesday 30th January 2013 Dr Heather McGregor, MD, Taylor Bennett Dominique Hainebach, MD, Renew Partners Ruby McGregor-Smith CBE, CEO, MITIE PLC N. James Charrington, Senior MD & Chairman EMEA, BlackRock Inc. Dr Nigel Wilson, CEO, Legal and General Group PLC

Corrected Oral Evidence - Session 4...... 94 Thursday 31st January 2013 Helena Morrissey CBE, Founder, 30% Club; CEO, Newton Investment Management Amanda Mackenzie, Chief Marketing and Communications Officer, Aviva PLC Peninah Thomson OBE, CEO, Mentoring Foundation Dr Emily Lawson, Partner & Co-author of Women Matter series, McKinsey & Co Ama Afrifa-Kyei, Advisor, Employee Engagement, Diversity & Inclusion, Deloitte LLP Louise Brett, Partner, Consulting, Deloitte LLP

Corrected Oral Evidence - Session 5...... 125 Thursday 7th February 2013 Alison Carnwath, Non-Executive Chairman, Land Securities PLC; Senior Advisor, Evercore Jo Swinson MP, Minister for Women and Equalities

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Written Evidence: Submission 1...... 151 Dr Heather McGregor, MD, Taylor Bennett

Written Evidence: Submission 2...... 153 Cynthia Carroll, former CEO, Anglo American

Written Evidence: Submission 3...... 157 Jackie Hunt, CFO, Standard Life

Written Evidence: Submission 4...... 161 Heather Jackson, CEO, An Inspirational Journey

Written Evidence: Submission 5...... 164 Helen Owers, former Executive, Thomson Reuters

Written Evidence: Submission 6...... 166 Dominique Hainebach, MD, Renew Partners

2 Corrected Oral Evidence- Session 1 Corrected Oral Evidence- Session 1 Monday 21st January 2013

Members Present: Mary Macleod MP (Chair) Dr Thérèse Coffey MP Caroline Dinenage MP Andrea Leadsom MP

Witnesses: Nigel Whitehead, Group MD Programmes & Support, BAE Systems PLC Marjorie Strachan, Group Talent, Royal Bank of Scotland Group PLC Anna Fullerton-Batten, Talent Acquisition Lead, UK Staffing Team, Microsoft Evidence:

Nigel Whitehead, Group MD Programmes & Support, BAE Systems PLC Marjorie Strachan, Group Talent, Royal Bank of Scotland Group PLC Anna Fullerton-Batten, Talent Acquisition Lead, UK Staffing Team, Microsoft

Thérèse Coffey: Can I just say thank you very much for agreeing to come along, it is very kind of you to do so. We are all parliamentarians. Shall we all just introduce ourselves?

Caroline Dinenage: Hello I’m Caroline, MP for Gosport.

Thérèse Coffey: I’m Thérèse Coffey. My background is that I worked for twelve years for Mars, one of the largest privately owned businesses, and half the board is women. That is just a family, an unusual situation, I appreciate that, but it does not include the executive management team, that is where there are fewer women involved.

Mary Macleod: I’m Mary Macleod, MP in West London, and I spent twenty years or so in the city in consulting in the financial services, investment banking and retail banking. I’ve spent a lot of time in the past either looking at getting more women into parliament, or as a business, looking at diversity generally in trying to get more women up through the pipeline, but in parliament also getting more women into parliament. Actually also – and I am so excited about tomorrow, because we have got the succession bill coming before us tomorrow. I wrote in 1999 that I felt females should have the right to succeed to the throne, so I am very excited about that. I think in all different respects I am trying to push the female agenda, which to me is all about equality and fairness, and making sure that women can achieve their potential just like men do.

Andrea Leadsom: Absolutely. I’m Andrea Leadsom, MP for South Northamptonshire. I had 25 years in finance, including 11 years in Barclays, two years in a hedge fund, and ten years in Invesco Perpetual, a big funds management company. Also 13 years as Chairman and Trustee of

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a children’s charity out in Oxfordshire, so both in the voluntary sector and in the banking sector, and again very much dominated in the banking sector by men. Women tended to fall along the wayside, and it has always been a bit of a mystery to me as to why that is. It is not a complete mystery, but I think a lot can and should be done to make it easier for women to go in and out of their careers. Rather than have a fabulous career, have a baby as late as possible, and then effectively be written off for the rest of their working life. Which is what happens, sometimes by choice, but very often just because employers think you if you are over 40, then you are over the hill, and you can’t possibly now aspire to come in at a middle level and achieve great things. I think there are some structural issues, particularly for women who have children.

Q1 Thérèse Coffey: In a nutshell then, this is a crowded space in terms of people talking about women on boards and quotas, which we don’t particularly want. We decided to focus on a particular area, which is how do we get more executive women onto boards? For us, that is often the pipeline of talent. Can I kick off with asking, could you outline how your company goes about its appointment process to executive positions of a senior nature? Do you have particular measures as part of that to try and get gender diversity in it? Do you want to kick off, Nigel?

Nigel Whitehead: Okay. It is an issue which we take very seriously and I am pleased to be able to talk about it. It starts at the very top, our managerial executives who are absolutely committed to the issue. As recently as the middle of last year, the chairman was able to explain to our AGM that we had achieved our 25% aspirational target for our board. Indeed our executive committee achieved the same, 25% average as well, which is a very strong signal not just externally, but also within the company, and we also report on the initiatives in line with the changed Corporate Governance Code as of October last year. Having said that, we respect the fact that as a business we are tapping into the defence and aerospace market as it exists in the US. As a global entity we have access to a global market, and from that perspective we have two North American women on our board and executive committee. If you look at the UK part, and I am responsible for UK businesses, we have to ask the question, “is that sustainable?” The immediate answer to that is no. In fact if I mention the nature of our challenge, this problem, for decades engineering businesses have not attracted a proportionate number of women into their businesses. Today our starting point is only 14% of women in our business. It employs over 38,000 people in the UK, only 14% are women. If you look at the number of women coming out of engineering programmes, engineering degrees in the UK, it is about 12%. Notionally we match the pipeline, in terms of the foundation of our company. We think for the 12% we have to look at the further education system. But what are we doing about it? If we look at the 14% we have in the company it is unacceptably low, and we are driven by the simple concept that we actually need better positions in our commerce teams. We have intuitive experience that tells us that. We also have some of the available research and data that underpins that. So we fundamentally believe in sustainability. Just to further define the problem, although the headline is 25% at the top, the reality is that we have a disproportionate drop-off of women representation as we get towards the higher levels, so we have as it were a hole in the management pipeline. A simple question, “how do we recruit to the board?” is more of a challenge than it appears from a distance, so what are we doing about it? Since 2005, we have been running a school roadshow where we have been trying to inspire the next generation. We have actors – it is a theatrical performance – the centre figure of whom is a woman, a young woman who is better at science and engineering than the guys around her. So it is fun, it is dramatic, and measure the impact. We inspire over 25,000 schoolchildren in the UK each year. 85% of those who see the theatrical performance say, “this is great, I would like to do engineering as a result.” The big issue is actually the perception of girls who see the show. Why do we target the age group of 9 to 13 year olds? Because science and maths are difficult when

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you are doing GCSEs, and some people are just scared at that stage, and see no reason to do it. We target that. We target our apprenticeships, we target undergraduates in the same way. We also invest throughout the careers of our target population. Our company runs on the basis of a meritocracy, and in that regard everybody who comes up through the business can acknowledge that the business is about talent. It is a bit of an embarrassment to us that something is going wrong, that there is a hole in the management pipeline. We have done some of our own research, focus groups, talking to teams and said, “what is it that is going wrong?” The sense of it is that there is no glass ceiling, but there is an environment and a culture which is unattractive to progress to senior grades. As a team we are looking at what we would do to develop the high potential women in our business. Also what we need to change in the environment in which we are working. We have identified some unconscious bias in our organisation, we have identified the need for training, that has made a difference. We have identified the need to mandate that there should be at least one appropriately qualified woman on the candidate list for every job. We’ve seen that makes a big difference to the selection process. We have seen an opportunity to have more women on the selection panels for various jobs, and realised that has made a difference to the outcome as well. We have shifted the point percentages from about 12% or less to 22%, since we have had that approach in place in the last 12 to 18 months, by taking these positive steps. We have briefed external organisations, executive search organisations, as to what our agenda diversity targets are. We have stopped short of quotas, which we believe in many ways devalue the point I just made; having individuals signed up to a role to fill a quota fundamentally undermines those individuals in a meritocracy. We like the idea of aspirational targets, and we work hard to achieve those. Our personal objective is to achieve 100 additional women as senior leaders for our organisation to fill that gap between now and 2015. We have asked just about everyone up to Chief Executive. Our stats show that to be emerging, so it is very real in our organisation.

Q2 Thérèse Coffey: That is a key measure then?

Nigel Whitehead: Yes. It is critical in our organisation. We are very careful that it isn’t a quota, but absolutely it is something we are measuring. Everybody is committed to it, everyone think it is a good idea, but it is hard work doing that. So without wanting to take up too much time, that’s what I would say at the outset.

Q3 Thérèse Coffey: To summarise, you have got a smaller number of women anyway, but you recognised people still weren’t making it. With this unconscious bias training, looking at the number on the candidate list, changing the selection panel, you are seeing a difference in them coming through. That’s really helpful.

Nigel Whitehead: There is also an entry programme which we can come back to.

Q4 Thérèse Coffey: Who would like to go first from you two?

Anna Fullerton-Batten: In terms of the executive level succession we are here to discuss, on the board we are currently seeing internal succession into those positions. We also look at the external market as well. When thinking about the executive pipeline, in my opinion, there are three key stages to consider. The female executive pipeline ready now who are able to go straight into a board role. The women who will be at board level in five years who need developing to get to that point and taking the discussion on how you develop women to ensure that they are ready to go into those roles. Then finally the mid management level, who may need 5 to 10 years to reach board level and the importance of having the right pipeline at this stage and ensuring that they stay in the business as this is where the biggest challenge is for the leaking pipeline.

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Q5 Mary Macleod: Can you just say, I’m sorry, where Microsoft is at the moment?

Anna Fullerton-Batten: 24%, globally.

Mary Macleod: Sorry?

Anna Fullerton-Batten: 24% of people at Microsoft are women, this is a global number. In the UK we lead an external benchmark with other companies who compete in our sector. It is carried out by a third party organisation and we look at not only our own population but what the average is across our industry. Based on this information, we set internal targets which help to drive diversity initiatives in Microsoft UK. Our targets are split into technical, mid-management and board and we are continuing to add more categories to benchmark. In terms of where we are, we are above target in all areas and have seen significant progress in reversing a three-year downward trend over the last six months with more senior women being promoted.

Q6 Thérèse Coffey: Out of interest, who came up with 24%? That is very specific.

Anna Fullerton-Batten: Yes it’s exactly 24%. There are internal targets which are agreed in each country and which are dependent on the political, cultural and social environment. In the UK, we benchmark against other Technology companies every two years and then aim to hit or exceed the highest number. We agree targets at an international level, which is everything outside of the US. It fluctuates slightly in each of the different regions and areas across the international area, but it is fairly consistent.

Q7 Thérèse Coffey: Out of interest, how does that compare with the US? Do you learn from your colleagues over there about what they do?

Anna Fullerton-Batten: Sure. We have a global diversity lead and a team that has representation in each of the regions, the global number is 24% and the UK is trending higher than that number.

Q8 Thérèse Coffey: Okay. I was just interested. Marjorie?

Marjorie Strachan: Hi. Thank you for inviting me along.

Thérèse Coffey: A pleasure.

Marjorie Strachan: I look after RBS’ global inclusion agenda and I’ve got a very similar story to tell to my two colleagues to my left. RBS, slightly different demographic to kick off from actually, when you compare against BAE, because our workforce is probably round about 50/50, male and female, predominately because of the retail banking operations, that would be different in investment or corporate banking areas. That said, we are pleased too that at the end of last year we were able to meet the commitment of 25% of women on boards. But that wasn’t as hard as perhaps it might be to make a commitment at executive and senior management levels. That is I think where the focus of work needs to sit. I was interested in the question, “What do you do therefore in terms of beating that pipeline?” At a very high level – I know you’ll ask me the numbers – around about 20% of our executives in the UK are female. That is a large number of executive appointments, because there are about 70,000 employees in the UK in RBS at the moment. A quarter of our senior management population are female, and roughly a third of our

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managers are female. That may sound on the surface to be relatively to be respectable, but there is still no 50/50 gender balance or anything like that. What we recognise is that we do need to do practical things around targets. We would not necessarily take the view that a quota is the right way to go, because that misses the point around some of the talent management practices that I think the bank needs to make smarter. But we do have targets at the executive level for example, the same as yourselves at BAE, every shortlist for an executive post must have a woman on the shortlist, and so too must every panel of interviewers actually taking part in that selection decision. Some common themes too are the unconscious and subconscious bias that we talked about. We are very aware in the traditional world of banking and with the usual stereotype that it is important for our line managers to be aware of the kind of subjectivity that might crop up. We are, similarly to BAE, rolling out unconscious bias training. We have done a fairly thorough audit of how we describe work and how we advertise for roles to try to remove anything that non-deliberately but unconsciously would make women less likely to apply for the roles in the organisation. But I think more importantly where we are turning our attention this year is towards more of our focus on what we do in our hiring practices to make sure that we recruit the right people to the roles, as opposed to it being specifically a male or a female. But in parallel, we are making sure that, top down through the organisation, particularly at a leadership level, we are very aware of the value of difference. We are trying to get the right mix on teams and in the workforce, beyond simply looking at females per se, looking at a more diverse mix of people in the workforce so that we get that benefit, if you like, that our research would have.

Q9 Thérèse Coffey: Diversity rather than mini-me’s.

Marjorie Strachan: Yes exactly, looking at the pipeline, absolutely, and looking at supplier requirements. But we are also looking at what we do from a development perspective, thinking with colleagues here, and we do have a number of mentoring programmes within the organisation. We do a lot in partnership outside RBS, an example being “Inspirational Journey”, which is a large network outside RBS where we have roughly 6,000 members of RBS participating in the programme, which leads to I guess the collaboration of our customers as well. We look at the whole process of gender diversity, not just through the employee lens, but also the supplier and the customer lens as well. Particularly in the corporate bank, and I’m sorry that Chris isn’t with us today, Chris is our gender sponsor on the Exec board. He also happens to be the Chief Executive of the corporate business. Through that we have something like 130,000 SME customers who participate in those programmes with the employees too, so I guess we are trying to come at it from both angles. I think what we also recognise is that once we get employees through the door the important thing is what we do to train and to develop them, so that they do move up through the pipeline. What we are working on at the moment, I have been working on for a few months, so moving away from just looking at quotas and benchmarks, what we are working on at the moment is how we improve the leadership effectiveness. The cascade of the right value system down through the organisation so that actually we get the right selection decisions through that. We get more women in the right places, but actually that is an outcome of managing people effectively anyway.

Q10 Mary Macleod: I was going to ask about that. How do you drive that message through the organisation? Maybe it is by measuring very clearly. Is it that it is the Chief Exec or the head of the corporate bank or whoever it might be, if the most senior person is talking a lot about it, does that make a difference to it driving through the organisation? How do you actually make sure that they actually deliver it?

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Marjorie Strachan: I think it has got to be a combination of having that sponsorship at that senior level, but actually creating an environment on the ground where women do feel free that they can come through the pipeline and apply for roles. A combination of activity would also be on providing employee support that we have at the bank, around things like flexible working, childcare arrangements, other systems that we have put in place to try to encourage more women in the workforce. That creates the difference at the lower levels of the organisation, but what we see happen there on in is an increase at the more senior levels as those people proceed with their careers through the organisation.

Q11 Mary Macleod: I just want to check if the other two do anything different on that?

Nigel Whitehead: Very similar in stark terms, but employees in any organisation for a similar period, well years and decades for ours, tend to judge management by their actions not words. The actions to your point at RBS, they can champion from the top, but it is the practical things that are done: encouraging, for example, women’s networks to be set up in the organisation and making it possible for those to exist by funding various activities; making sure that the personal development and structured career plans are in place for individuals, that there are opportunities to go on significant development courses; time spent on mentoring programmes, and that appointments are made so that senior women can be in positions where they can be role models; equally role model behaviours. You could say that a lot of the flexibility that is created by people with families is actually a generic issue for men as well. We have found progress by the Chief Exec of a senior team actually exhibiting some of those role model behaviours, like leaving early on Friday. By doing that we are actually pointing out that we are not measuring people by the hours they spend at work, but by the contribution to the workplace. Once you get that message across to your role models, it spreads out like wildfire across the organisation, and they take the cues.

Q12 Mary Macleod: Anything else to add?

Anna Fullerton-Batten: I think absolutely we need to have everything that we are talking about, but we take it a step further and have detailed and tailored action plans for each business area. Microsoft is such a diverse business that we found that each group has different diversity challenges so we worked with the business diversity sponsor who sits on the D&I council to decide where they should focus their time and activities. Each plan has three levels. They have what we call Foundational, Transformational, and Game Changing. It is a menu, so there is a mandated section which includes unconscious bias training and ensuring that women have mentors and sponsors. Then the business sponsors and leaders monitor and audit results and their progress is added into their objectives or goals. We also have a D&I council which includes business leaders, sponsors and the leads of the Employee Resource Groups (ERGs) including BAME, out LGBT group – GLEAM and the Women for Microsoft group. So what we are basically doing is ensuring that we are talking about D&I at every level. Then we also have the voice of the employee which includes attending events, networks, things like that.

Q13 Mary Macleod: It sounds like it is part of the organisational culture in a way.

Marjorie Strachan: I think that is really key. I think your point on a scorecard, well, we wouldn’t necessarily call it a scorecard within RBS. I think it is important that the organisation has some form of construct that allows them to decide, “are we doing okay? Are doing well at this?” I think that is to your point about being kind of game changing. We don’t profess to be at that stage, or anything like that, but where it has made a difference is on the push-pull. Having the right

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sponsorship at that senior level in each of the divisions, and the right council, with architecture and governance in place. But having these organisation systems operating in parallel so we are seeing the feed through of high performing women, or simply a high performing workforce of which some will be women. Being smarter in our selection decisions so more of these women make it further up through the pipeline is probably the best description of how we see it happening.

Q14 Andrea Leadsom: I’d like to ask you a bit specifically about the pipeline to the board. First of all, do any or all of you assess at what point women start to drop out? Is it because they have children? Is that absolutely statistically significant and a proven fact that that is what is they limiting factor? That women take time off for children and then never quite recapture that same career, either by choice or because the organisation doesn’t allow them? In other words, do you track women who don’t have children and how easily they progress compared to men, versus women who do have children and the outcomes for them? Actually further to that, part two of that is: do you think that shared parental leave - if the answer to that is yes - then is shared parental leave the answer? Or is it actually always going to be the case that more women are going to choose that option?

Marjorie Strachan: At the executive levels at RBS, it would not be true to say that it was because of children that women fall out the pipeline. That may be more likely further down the pipeline, at clerical and junior managerial roles. We don’t specifically track that point, but I guess if I think about role models in the bank, and senior women who are executives, most are mothers. Most actually do work full-time, but the opportunity is there for them to have flexibility at work so they can manage whatever logistical childcare they need. That is true for the fathers as well. I think the point about shared parental leave is actually quite an important one. Actually removing some of the stigma for men to participate in those types of support is something that we try to publicise in the bank. We offer nursery vouchers, access to nursery school, flexible working hours, compressed hours, those types of opportunity are there for both women and men in the workforce. But I don’t think that women fall out the workforce at that senior level because they have got kids. It might be the case that that happens further down the pipeline, where they don’t get into the position where they have the opportunity to go for an executive position.

Q15 Andrea Leadsom: Just – we will move on in a sec – but just, is it then a function of whether they have kids and work full-time, but flexibly, does it make a difference if they have kids and then work part time? Does that kill your career? In other words, can you be a parent, work part-time and still have the same career progression?

Marjorie Strachan: I think at the RBS bank yes, there are women and men who have got families, it hasn’t really seemed to have impacted on their careers at all.

Q16 Andrea Leadsom: Even being part-time?

Marjorie Strachan: Yes. In fact recently we did win an award for the power of part-time top 100 jobs or whatever it is called, for a woman who works two days a week, who is an executive in the bank, and works two days a week because of her childcare commitments. But she has been an executive for a long time, and is very good at her job.

Q17 Caroline Dinenage: I think the quote about flexibility working being a stigma is actually a very important one. I sit on the Business, Innovation and Skills Select Committee, and we are doing

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a very similar study. In Iceland, they introduced a section of maternity leave that could be taken by the fathers. When it was optional, they didn’t tend to take it because of the stigma attached to it. Then it became compulsory, they either had to take it or they would lose it, and suddenly it became the thing to do and actually their productivity at work increased when they returned. I think your point about cultural change is important, because in professions such as law, to become a partner one has to do all the hours, play golf matches, all these things which would have made them a partner in the past. I wanted to ask you following on from your point about the engagement with the children in the roadshow where you visit schools, how much opportunity is there for you to communicate with schools? Because effectively they are our supplier, they are producing the workforce of tomorrow. Often I worry that at school children are in danger of getting the wrong guidance. They may be encouraged to sit combined science rather than the three sciences which are required for the engineering qualifications that they need; girls might not be encouraged to do the more male orientated, financial, and economic, engineering and science based subjects. How much opportunity do you have to engage with schools and tell them what it is you actually need out of the workforce of tomorrow?

Nigel Whitehead: If I can start? It is a huge gap between the perceptions of schools and teachers and the career advisors in that system. Telling children what the realities are in the workplace, and the opportunity to manifest them. Some people don’t like the idea of an arms company crossing the gates of a primary school. Others are up in arms that it is a matter of taste. We have also actually tried in many of the institutes we have come across to mention our school brochure. We also have a programme of school ambassadors, particularly apprentices and recent graduates, who actually go into schools to help. If you look at the BAE Systems website and the education section there is a massive amount of educational materials we have made available, which follow the school curriculum but illustrates the nature of what is being taught in engineering terms. Talking to teachers it is a very, very popular resource in schools. We recognise it is possible to bridge, but one company cannot do it all. We have set up a network of schools in the UK, and from that perspective they will welcome the ambassadors, but there is a big gap to bridge. Equally with the parents as well, also within the communities and factories, they are much more able to accept the argument that there might be a career for their daughters in engineering works. Those who don’t don’t actually affiliate with the brand BAE Systems, so it is therefore an outreach programme whether it is for our company, or for engineering in general. It is a big gap, and something that could be addressed.

Anna Fullerton-Batten: Yes sure. In terms of working in schools, our employees are very active and often proactively speak in schools when asked. Our intern and graduate populations work on an internal schools committee who go into schools and talk – there is a structured programme behind it. We provide all the materials to talk about technology and obviously the advantage we have is that the tablets and phones are always really interesting and popular, kids love to play. We have a programme called Digigirlz which brings over 200 girls aged 14 into Microsoft in a day and they have a structured day of technology and informational discussions talking about what an exciting sector technology is to work in and how successful women can be. We have hired interns who were part of the Digigirlz programme. We also encourage our employees to be proactive with their support and provide three volunteer days which the employee can choose how to use.

Q18 Mary Macleod: Just coming back to this engineering as well, there is a bit of an issue in terms of getting girls, female graduates into the more techie engineering science-type courses.

Anna Fullerton-Batten: We have done research and there are four key points where girls drop out. At 14/15, when they are making options. It is often the case that girls are less likely to take pure

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maths, and for a computer science degree they need maths, so they often drop out at that stage. If they then continue, what we then find is they then take A Levels. What happens at A Levels is that even if they take an A level in computer science then they don’t necessarily take computer science forward into a degree in that subject and they drop out of the pipeline. The third stage is that if they do take a computer science degree, then there is another drop out point when they graduate when they opt to not follow a technology career but perhaps go into consultancy or law for example. The final stage is the point at which they have children, we have again seen another leaking pipeline which can be for several factors – in some cases dependent on length of maternity leave, it can be due to technology changes and how to keep their skills up to date for example. We support with this and have a great programme for returners to work which includes external coaching and training. All of these factors contribute to why women drop out of the pipeline and we are working as a company to make Technology seem more obtainable and attractive as a career. We also currently have our own network of five hundred women from a hundred and fifty different companies in lots of different sectors and we use this forum to talk to them about technology and then also encourage them to find out what their challenges were when they came in, so that we have positive role models to talk about when we go into the schools and also to encourage them to help other girls and women up the ladder.

Q19 Mary Macleod: Good. Because I’m guessing that potentially both of you will have to work slightly harder within that in persuading women to come in and join you, because of this more techie or engineering-type background. Is there perhaps a challenge a bit in terms of – what is there more you could be doing to go out there and selling your industry sector, as well as your organisation to girls, female graduates?

Nigel Whitehead: My answer is yes. It is a matter of some pride to us that a young woman from BAE Systems has been our apprentice of the year, again entirely on merit, and also recognised as the National Apprentice Champion of the Year. I’m aware of the impact they have as role models within the very group that we are trying to appeal to. If we actually then have that in schools or just newspapers, it makes an impact. I had the great privilege of sitting next to the Queen at an event lunch, and the very first words she said to me was, “isn’t Rachael impressive?” Rachael was the National Advanced Apprentice of the Year in 2008, and she had been on national TV three weeks prior to that. Okay you could say that’s her briefing, but she was able to talk in some detail about what she had seen on TV. This is a young girl who was told by her school they weren’t going to reference her for an apprenticeship, because she should go to Cambridge, because she was good enough to do that. She said, “no, I want to do a craft apprenticeship, I want to learn to make aeroplanes”. We sponsored her to do her degree, and she did very well. She is four or five grades above where she’d naturally be in the company as a graduate. A very, very impressive woman. But it is also role models that make a difference. We are doing what we can to promote role models within our target audience. But we are only one, and engineering companies in general should do more. Equally, working with media. You may have seen the fantastic programme “How to Build a Nuclear Submarine”, which should have got 700,000 viewers. It got 3.2 million viewers, and had more hits on iPlayer than Top Gear did for a month. It was a great programme. It wasn’t actually about submarines; it was about learning to be an apprentice, about learning to be a welder. That is a magical story, and that is what people talk about. We are pledged to try and get whatever we can through the media, to try to get through to various schools and children themselves that actually this is something that they can do. Every work experience placement we create we hope to make sure they say “I could work there. These are nice people, I could do that sort of job.” Whereas in this instance where we don’t have that, and it’s a weakness in the company, it is difficult to prove they want to work there. As soon as they see what it is, by the process of opening our doors

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wherever we can short of there being security issues, to actually show them what they can do, what we do attract, leave the product they have created with us, a report or series of recommendations, or something that they have created, just to get them fired up about the job. There is a whole lot more we can do.

Q20 Caroline Dinenage: So what you’re saying is, you’re only one company, though you obviously do a lot of work. What more can be done to encourage, coerce, persuade and force other companies to take action?

Nigel Whitehead: We would encourage our suppliers, we have 7000 suppliers in the UK, 2500 in the United States, to talk more about that. Talk to our other partners and other organisations that interface with the UK, encourage that. As well as my day job, I have a governance activity which is towards working to commission skills. My particular element of that commission activity is in application skills. I have been spearheading an employer commission last year, and we are committing that into the workplace in the UK. Employers are coming up with schemes to generate apprenticeships and work placements and generally opportunities to employ people. We have seen that gender bias, so are able to identify those things. By getting into schools, funding after school science clubs, engineering clubs and so on, to just get the message out through our ambassadors in schools. We have started the process and hopefully it will spread.

Q21 Caroline Dinenage: Is there also anything the government could be doing to help businesses achieve these goals?

Thérèse Coffey: You are talking about filling the funnel aren’t you? As opposed to perhaps mid-careers.

Caroline Dinenage: Yes it’s about filling the pipeline. If more women are dropping out of the pipeline, you’ve got more women coming in at the beginning.

Mary Macleod: I guess it is keeping them, it is retaining the talent you have at the beginning as well. That is why I asked about getting more women in. If you can retain them, and you all seem to have really good initiatives and interventions that you’ve put into place to try and retain that talent, and make it as flexible as possible. I guess my question was: given all of that, do you feel positive, if it is five years, ten years down the line that you think, or is there something else that you can do, that we can do, that women can do, is there more of a gap still that we need to be looking at to achieve in five or ten years time?

Anna Fullerton-Batten: I feel positive about the entry point from a Microsoft perspective although it could always be improved. Our graduates win awards and we have targets to try to ensure that the entry point is right. But to go back to your question we didn’t answer, around are kids career killers –

Thérèse Coffey: Sorry that was my phrase.

Anna Fullerton-Batten: Was it?

Thérèse Coffey: Yes it’s a bit terrible!

12 Corrected Oral Evidence- Session 1

Anna Fullerton-Batten: I think the challenge is at mid-management point, there is a finite pipeline currently ready at board level. There needs to be general improvement in development plans which train women to have the skills they need at board level whether they are presentation skills or confidence training to avoid imposter syndrome. I wouldn’t say kids are career killers. I speak to a lot of women through the networking and the groups that we speak to. I spoke to a lot of women in Microsoft before I joined six months ago and we got some feedback from our senior women and executive women. One of our board members has five children, so I don’t think it is holding women up on the executive board. But I think getting there, that five year journey is the point at which they make a choice as to whether this is the lifestyle they want, maybe they come back from maternity and they are juggling multiple priorities or maybe they have other interests which they would like to invest time in and they don’t want to prioritise their career – it could be multiple reasons. Flexible working is in place and used widely in Microsoft but the reality is that where you are trying to manage a large sales territory where you could be driving and travelling for large periods every day, what do you do if the nursery rings and you need to get back. What do you do?

Andrea Leadsom: I think if you’ve got five children you stay at work.

Anna Fullerton-Batten: For me role models should be authentic, so if the Executive wants to go home at 5 o’clock every day because they have commitments then they do and we see that on the board. That is a role model for me. She is actually going home and spending family friendly time, and then she works in the evenings as well. One of the problems I think we face as a country, and this is my view not Microsoft, is being able to say no to part-time work. You have to put forward the justification as to why you are blocking it, but you can still say, “no”. I think this restricts job opportunities, especially as we are moving towards a workforce that is focused around work/life balance.

Q22 Andrea Leadsom: Sorry can you be clear? You have to be able...?

Anna Fullerton-Batten: You currently can turn down part-time work if it isn’t commercially viable. This stops companies looking at options of how to make a role part-time.

Q23 Andrea Leadsom: Yes. I think that is absolutely key. I do think that is absolutely key. I think that companies have hidden behind the fact that you can’t possibly do this part-time, and yet you don’t have to work on a Saturday or a Sunday so how does that work?

Anna Fullerton-Batten: But change won’t occur unless you force change. I think splitting the parental leave to your earlier point is also essential, I think ensuring that everyone equally gets a chance to take parental leave.

Q24 Thérèse Coffey: I was under the impression, this is always the case at Mars, that we would be deemed big enough that if you turned down part-time work you would probably be taken to court, and lose. Is that right?

Anna Fullerton-Batten: Of course. You have to come up with a good business justification as to why that wouldn’t be the case. Also, the employee has to want to go through the process of taking their employer to court which at a time when they have been through a life changing experience like having a child is not their first priority.

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Q25 Mary Macleod: It is not just about whether you allow or are not allowed part-time work, it is aligning your promotion process along with it. I think I mentioned to you about the friend of mine – Clifford Chance told her, “you can go to four days a week, yes. You can do four days a week, but actually you will never get a bonus. You will probably never make partner.” It is things like that.

Anna Fullerton-Batten: A network contact told me a similar thing this morning. She was told that when she went on maternity leave, she was six months away from making partner. She had six months off on maternity leave, and when she returned, she was told she was eighteen months off being partner. It was also discussed internally in her company that if you went part-time then you would never make partner. I think a lot of the anecdotal feedback I’m seeing is, you can go out of work for a year, then return to work, if a woman plans to have a second child then she can be out of the workforce for almost 3 years with only a small return period. During this time, they lose sponsors, mentors and they come back and feel more isolated with juggling priorities. This is feedback that I heard that surprised me, which is why I did a lot more research into it. We have actually done surveys, both external and internal, to look at this in more detail, but it is a common thing. Women are feeling overwhelmed. I have written a short paper for this event which I’ll send to you that has some anecdotal feedback from the women we spoke to in it. Just one more point, men are four times more likely to have a supporting partner at home, women are twice as likely. This makes a big difference, especially in executive roles because it means you can focus on the job.

Q26 Andrea Leadsom: That is really the point isn’t it? To be able to manage the workload. The question is, whether you have to do Monday to Friday 7 until 7 to manage the workload. Why not Monday to Sunday 7 to 7, or Monday to Wednesday 7 to 7? What signifies you managing that workload, or job sharing? I do challenge the corporate mentality which is that no, it has got to be Monday to Friday. I mean I have my own experience of it with Barclays who said, “we have managed without female senior executives until now, we certainly don’t want part-time ones”, when I said about fifteen years ago I wanted to go part-time. It was just a complete non-starter. That is a long time ago, but it still rings very clear that there is a price you pay if you want to go part-time. There is a very big price you pay in career terms. It would be interesting to know whether you think, all of you, that there is still that price to be paid?

Anna Fullerton-Batten: I think I can only give anecdotal information, I have heard many stories from women asking for part-time work that was turned down. Interestingly, as many as 85% leave those companies but most of them don’t leave for at least a year. There was a recent example where a Director level female employee from our external networking group returned to work from maternity leave and asked for four days part-time. Other women in her team with the same role were given the leave and she wasn’t although she was the last to return and was always a high performer. She could have taken her employer to court but they were a large well known employer and she was worried about her reputation and credibility if she was seen to do this. There is a stigma attached to this behaviour. She left within one year and went to an employer who offered her the part-time work she was looking for. However, it was a smaller job than the one she was doing that was also less well paid but it gave her the flexibility that she wanted versus the 6am to 8pm days that were expected of her in her previous roles. It was her choice to opt out of the pipeline at that point.

Marjorie Strachan: I think that is where this whole concept of unconscious bias really comes into its own isn’t it? Comparing my experience of RBS, and I’ve been with the bank less than two years, so not in with the bricks and can’t be completely exacting. One thing which I think really helps to mitigate those types of situations – where that might be down to a particular

14 Corrected Oral Evidence- Session 1

line manager’s behaviour or bias around what works and what doesn’t – is putting in place the right kind of construct. Within RBS we have had a lot of momentum around what we call our “Choice Programme” which is where we actively try to force home working. We actually try to, and it is linked to property nationalisation and things like that, where actually there just aren’t the same number of desks to go round. Clearly this would work in some roles, perhaps not for a bank teller. But actually there has been such a push at executive levels for programmes like that to be successful, I think one of the by-products is that we have removed some of the unconscious bias around, “this simply won’t work”. But also the other thing that I think needs to be taken into account is part-time working is very different from flexible working. Where I think things have moved a little bit is organisations seem to be more open to flexible ways of working compared to putting a kind of label on it around Monday, Tuesday, Wednesday, Thursday, but home on Friday. Where we get into interesting conversations with our employees about flexible working is about a reciprocal arrangement. It is not just about the hard and fast working pattern, which you cannot defer from. It is about the reciprocal flexibility where actually it can be managed on an on-going basis, but it works for both ends of the employee and the organisation. Our Choice Programme is set up more from a flexible working perspective than part-time traditional working hours. Clearly that still exists. A lot of what you said around women falling out of the pipeline, that is what I was probably not articulating very clearly earlier. It is easier I think at executive levels where you have more resources, and you have kind of cut your stripes to be a senior woman in an organisation. I think it is harder when you come back and you don’t have the same resources, and perhaps you are in that part-time working pattern, as opposed to a flexible arrangement, which we would like to see more of within the bank.

Anna Fullerton-Batten: I think also another important part is social influencing time. If you are already managing balancing work and family then women forego the social influencing time. That can be really valuable time when you have unscheduled discussion time with other senior members of teams and if you are not there then you miss your opportunity to showcase yourself. This is why sponsors are critical to success because their role is to speak for you and to ensure that they know you well enough to talk comprehensively about your skills and experience.

Q27 Thérèse Coffey: You are not talking a round of golf, you are talking about time for coffee?

Anna Fullerton-Batten: It could be a dinner in the evening. It could be going to the pub on a Friday night; it could be golf.

Q28 Andrea Leadsom: What about the corporate hours? Because again, when you are trying to earn your stripes, actually you are not really working 35, 37 hours a week. There is also the issue isn’t there, as you are saying Marjorie, that the encouragement is towards flexible working. If you have got two kids and you are required to do 37 ½ hours plus, perhaps 60 hours, and you are cramming it into 3 ½ days, or spread out over certain days, and you are trying to be a mum to two kids, how does that work? I understand what you are saying, and certainly I would say my experience of banks is they were exceedingly intolerant of a clock-on clock-off part-time arrangement. But actually for people with very young children that can be the only way that they can cope, can’t it?

Marjorie Strachan: I think also back-up as well around the childcare that might be available, the emergency childcare that for example that RBS offer. In that particular scenario where actually there might be an employee that has to get through X number of hours in her working pattern, but something happens like a phone call from the nursery, what we do have is the back-up childcare.

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Within our own campus in head office we have a nursery. If anything like that was to happen, actually the employee has back-up support if plan A, plan B, plan C fails. That may be something –

Q29 Andrea Leadsom: Just to push back on that slightly. How does that work? If you get a phone call from the nursery, “your child has got a temperature of 103, take him away from here”, and you are an hour away in a commute, what use is a nursery at RBS headquarters?

Marjorie Strachan: You are absolutely right, in that particular scenario it would be the case that the mum would want to go home, or the dad would want to go home. In a situation where the child was still ill – perhaps not a temperature or something like that, because you wouldn’t want to bring them into the nursery environment – but let’s just say that grandparents aren’t around to provide the usual support, or an incident happens...

Mary Macleod: Or the nanny is off sick.

Marjorie Strachan: Exactly, just something untoward happens, we do have that, we call it back-up childcare, where if there is an acceptable scenario then the infant can come in to the nursery. That is there, but clearly that doesn’t touch all employees’ needs. You have got something similar?

Anna Fullerton-Batten: Yes. But I think I have a slight fear about the term flexible working. Because actually it is great to be able to work from anywhere, and everyone now can work from everywhere, but what are those hours as you go from mid-management to executive management, and how do you actually fit your family in? Because it is great to be able to work from home, you can go home and spend three hours with the children, and then you log-on for another three hours. Is that actually a solution?

Marjorie Strachan: At 3 in the morning or something.

Anna Fullerton-Batten: Yes. Then that doesn’t become sustainable, and that is the point at which women opt out. That is the point at which they say, “I can’t sustain this any further.”

Q30 Mary Macleod: Can I just go back to the question about how positive you are about the future? Do we think we can achieve fairly equality of women coming up through the pipeline and into – ?

Thérèse Coffey: Sounds like some success certainly in BAE, and some success in Microsoft. Could I just clarify that what you two measure, that RBS doesn’t measure at the moment?

Marjorie Strachan: We do measure. I know that one of the questions already was about the case study, I think Ed had mentioned that. But we talked a minute ago about the issue around the more technical subject matter in Microsoft and BAE. Actually in our investment banking operations it is quite similar, because often we look for mathematic graduates or, you know very strong, traditionally male-dominated degree subjects. If I take an example of a few years ago, 2009, I think our hiring stats into our investment bank was something like 23% women. By doing some things differently on the ground, on the campus and via the graduate recruitment programmes, we moved to something like 45% last year, just by being more inclusive in how we do the hiring on campus. Not going down the typical selection routes, but getting into more of a social environment and actually watching how female graduates operate compare to males. We make selection decisions based on a broader set of assessment requirements than purely degree subject, or how well they are doing in maths or sciences or so on.

16 Corrected Oral Evidence- Session 1

Q31 Thérèse Coffey: There are reasons to be cheerful?

Marjorie Strachan: Yes, I think we are feeling hopeful for the future.

Q32 Mary Macleod: Can I ask you all – some of you mentioned quotas – if you haven’t already said, just what your view is? But also just any feedback on the work that Lord Davies has done in terms of trying to promote the issue. He has said that if he doesn’t see improvement in the next year that he will look at quotas very seriously. But any sort of feedback that you think he has been useful, helpful or not?

Nigel Whitehead: He has raised the profile of the whole subject; he has raised expectations about the things that can be done, and companies are serious about the practical things that we should be doing. So I think the increase in the percentage of women on boards that we have will continue. I think that the pipeline, from very early stages all the way through the organisation, is important and I’m optimistic that he has got us on the right path. Personally I think it would be a negative thing if quotas were imposed, doubly so if they came through Europe. I find that almost everywhere in the UK industry, people know this is important. From our perspective there is a finite pipeline of engineers in the UK; if we can double that by having both genders represented, it is a good result. If we can improve performance, that is a good result. There are natural incentives for us to follow. If I might just throw in a little bit of a grenade around the UK industry, our research says that the most fundamental thing stopping progress of the organisation is the attitude of those hiring. Hiring people into positions and appointing them into positions.

Q33 Caroline Dinenage: Like recruitment consultancies as well?

Nigel Whitehead: Starting with the central company, who is actually making appointments to senior roles.

Q34 Mary Macleod: At board level committees or further down?

Nigel Whitehead: All the way through. If there were actually requirements, in terms of work, for example the attributes for a high performing team and what they need to add to that team to make it a high performing team, then they naturally choose male candidates more readily. The first thing we have to do is that unconscious bias training, to coach through it and having members of the selection panel there. That is the most fundamental difference for the future, that issue alone. We have seen in our company, just my organisation, various things you can do in terms of role models, flexible working, the nature of the structure, career balance, the network you create in the organisations, things we can do there which make that difference. There is a whole lot to go at, and Lord Davies put a spotlight on it.

Q35 Mary Macleod: Should he be doing more in the executive pipeline or do you think it is fine just initially that he talks overall about boards?

Nigel Whitehead: The complementary question to the top level measure is what is going to be next year and the year after and the year after that, so to develop a succession plan as I’ve already mentioned. We should be able to report on that, probably in our company accounts, this is our pipeline, in generic terms, so that it does not look as if individuals are singled out for special treatment.

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Q36 Mary Macleod: Any other thoughts on quotas or Lord Davies?

Anna Fullerton-Batten: I think what Lord Davies has done...it is obviously good, but I have some concerns, in terms of sustainability. The Lord Davies report flags sustainability and the leaking pipeline and I agree with the concerns. For me, it is about getting the pipelines I mentioned right which will then sustain the good progress that has been made to date. I am very confident in our policy in terms of representation, and innovation, and what we are doing at every level, at every entry point in the organisation, but for me it is about embedding diversity in the organisation. The leaking pipe needs fixing because we have very talented women who are opting out. That is the bit that needs to be addressed.

Q37 Andrea Leadsom: Do you interview them when they leave, on why they leave?

Anna Fullerton-Batten: Yes, we run exit interviews. In fact when we first started looking at female attrition we found we were doing generic exit interviews. So we tried a new method which was sitting down in a face-to-face interview and we were getting a lot more information. It is driven by the HR function and we have the feedback to the D&I leads, which has driven unconscious bias training for our managers. But also, it highlighted further understanding of different styles of working, being more flexible, and more being needed for people coming back to work. The interesting point is that we offer many services and it turned out that many returners just weren’t aware of them.

Q38 Caroline Dinenage: When you conduct the leaving interviews, what percentage of women go because they just feel that they have to, because they feel their lifestyle wouldn’t be able to work around children? What percentage of them say, “I just want to go and bring up children. I just want to go.” What percentage would go anyway no matter what you did?

Anna Fullerton-Batten: I don’t have a percentage because we have only recently changed to the face to face process. But what we have found is that women don’t give the reason you mentioned, they are less specific and give a generic reason, whatever it may be. The job wasn’t right. But I can tell you recently that a woman left without reason, and we did everything to try and support the woman. She has an executive husband, who owns a PR company and she just said her son was nine months. We offered coaching support, we offered more time out on maternity leave, we offered everything that we could do to keep her, but she said just wanted the time out. We felt it was a real loss as she was a high performer, and she said, “I cannot stay in this role as a high performer, and continue to perform to the level I was at.”

Q39 Andrea Leadsom: There, would you say to her, “would you like to come back in three years?” Would you consider that, or even five years?

Anna Fullerton-Batten: Completely.

Q40 Andrea Leadsom: She still said that she didn’t want to keep in touch?

Anna Fullerton-Batten: We offered her sabbatical leave and she is well connected in Microsoft and the business area she was in. We will stay in touch.

18 Corrected Oral Evidence- Session 1

Q41 Andrea Leadsom: But how long did you offer her leave for? Because I do think, when you have got a tiny baby – I don’t know if you have kids – but I know when you have got small babies you can’t see that there is ever an end to it. The demands of today, you don’t think it is ever going to end, so it would need to be like five years, ten years, make it twenty. You are alive a long time, just don’t leave us.

Anna Fullerton-Batten: It is more complicated from a headcount perspective because then you have to keep them in your head count. You can’t replace them and get anyone else to do the job which I think is standard in most companies.

Q42 Mary Macleod: Do you keep them as part of the alumni, or...?

Anna Fullerton-Batten: We keep them as alumni, so in every case I am confident that we’ll remain close to her, and we would 100% want her back.

Q43 Thérèse Coffey: Can I also ask whether there are any formal barriers to people rising up? I believe that the recent analysis show that of the female executive directors on the board, 45% of them have a formal financial qualification. Is there anything around there that you perceive to be a problem – they are not chartered accountants or they haven’t done this MBA or whatever it is? Is there anything like that, does that come up? You can say no.

Anna Fullerton-Batten: Again, more anecdotally, how they sell themselves for example, presentation skills or their media experience. I would say broader influencing skills, being able to influence at executive board level, and confidence. Imposter syndrome, so really being able to have the confidence to know that you can handle a situation well, even if you feel like you are on the back foot. We know from research that women like to have all the facts before making a decision and we know that isn’t always possible. It takes confidence to believe in yourself that you can make the right decisions and often women’s backgrounds and upbringing haven’t given them the confidence to believe in themselves and their ability – they doubt themselves.

Marjorie Strachan: That comes from development offerings doesn’t it? In terms of trying to develop confidence and competence of women, if that is one of the barriers. But I think the question in the Davies report, I think that gets the tip of the iceberg in terms of…for most organisations there is not a large distance to travel to actually get to that 25%. I don’t think that necessarily addresses the issues in the pipeline and the fallout issue that we talked about. I think for some women absolutely it is just a personal choice, but nothing will persuade women, or men, but usually women because that is the social stereotype, and to some extent that might be okay. But I think as long as the organisation is offering up the types of thing you have described in terms of more detailed exit interviews and more detailed support for career breaks, sabbaticals and stuff, it is difficult to then know how or what else you do beyond that. Because some people just make that personal choice. Unconscious bias, I was just going to say, we talked about it in the hiring scenario, I think it is also really important in the performance management situation. Also in the kind of talent board situation, where people are making decisions around who to move through the pipeline based on performance contribution and also potential. I think sometimes we think about unconscious bias but purely in selection decisions, as opposed to right through the employee life cycle. I think it is important to make sure that our minds are thinking about the decisions that could be made perhaps wrongly in some of those situations too.

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Q44 Andrea Leadsom: Just then, bearing in mind it is so often children that do get in the way, do you have any proactive efforts to then recruit women in their late 40s early 50s, and put them back on the sort of high, the fast track? Do you actually try and say, “it doesn’t matter what you did previously, your kids are now safely away at school, let’s get you in now.” Because that is the other thing isn’t it, it is an age stage thing. You work your way up, and we are talking about career breaks. But what if they never worked for you in the first place? Actually, what efforts do you make to recruit mums from the school gates who have just about had enough and would actually quite now fancy having a life again?

Mary Macleod: Just to add to that, there is a slight problem often there, because women who have spent say five years out of workplace lose their confidence and therefore don’t feel they can apply for the senior positions.

Andrea Leadsom: Yes, they apply for something part-time in the local chemist when they’ve got a PhD in engineering or something.

Nigel Whitehead: We have nothing in that category, it is a great idea.

Andrea Leadsom: Yes. I think there would be a lot in that. Literally at the school gate.

Anna Fullerton-Batten: It would be quite a simple solution, though you would have to be quite sensitive to how you did it from a discrimination perspective. That would my biggest issue, speaking as the staffing director, but you could for example, use social media to target women.

Andrea Leadsom: Mumsnet.

Anna Fullerton-Batten: Exactly, you could do it that way, but I think that could be one of the barriers.

Nigel Whitehead: We have a maternity returners programme, which has come into place because we have acknowledged the value of mothers coming back to work, to redress that balance, to work out how to present themselves in the workplace. How they essentially recover contacts around them, to say it is absolutely okay to leave at 4 o’clock, because I do these things and I am working that way, and to feel okay about that. To work with like-minded people in that process, put arrangements in place, feel strong. Those that don’t have that support struggle.

Q45 Mary Macleod: What about, I am wondering about, how much, dare I say, do men need to be involved? There is the unconscious bias bit. You have got your senior woman, but in terms of succession planning, how much do you involve men in this, in terms of, for example, do all your male members on the board sponsor some female executives?

Nigel Whitehead: Well we have some within the executive women pipeline, and it isn’t just mentoring programmes but sponsoring programmes. We are actively engaged, we take a personal interest in their progress in the organisation, creating opportunities, developing a personal employment plan, actively putting them on the courses the employee needs to get the particular experience they need. Working with them on issues of confidence, which is what they sometimes lack. There is no attribute lacking other than their own perception of where they fit in; if you give a man a job, he says, “I can do this in three minutes.” If you give the job to a woman, she’ll say, “I am not the right person to do this.” There is an attitude issue, it is that simple, you are good enough to do this.

20 Corrected Oral Evidence- Session 1

Q46 Mary Macleod: How much visibility to they get at board level, because the more they build relationships the more confidence I think they will build. Also then board members will think, actually we have got some great women here. Any other points?

Marjorie Strachan: We do do that through something called our “Strategies for Success Programme” which is where it is focused on women at the middle management level to try and build this confidence and competent issues that we have been talking about. That would be open to not only returners, but also women looking to further their careers. It is really focused on that type of issue in terms of impact and presentation skills and confidence and such like. I think also, through our focused women’s network, which is the network I mentioned a while ago where there is a large group, 6,000 odd women in the UK, but it is men as well. I think through that actually we are running offshoots, which would be around career progression, but it is employee-led and employee-managed, and has taken on a kind of life of its own to try to tackle the issues that we have been talking about today. Chris, who is the CEO of the corporate bank, and the gender sponsor in RBS for us, takes a very active role. There is no getting away from the fact that because somebody senior in the organisation takes a very active role, they become a role model and so to therefore do a number of other senior people in the organisation, who then provide coaching. I wouldn’t necessarily call it mentoring, but actually more formalised coaching of individuals on a kind of one-to-one more personal basis. One of the things that I would like to see different, though, is to pull more structure and measurement to that, so we actually see the impact of that feeding through the pipeline going forward, as opposed to it just being a nice thing to do. Intellectually it feels like we should be able to evidence some of the benefits from it and that is the kind of sphere that we are moving into now.

Q47 Mary Macleod: The problem I think with some of these female programmes, it can become a tick box exercise. “We do all that, we must be alright”.

Marjorie Strachan: Absolutely. We have got to open it up to men and focusing on the women’s network is the wrong badge for it. We are trying to think how do we move away from that and actually we will move people up through the pipeline, but it won’t be all a women’s network. Which you know, can cause the opposite problem within the organisation.

Andrea Leadsom: We have all girls in the women’s forum, with the odd bloke that doesn’t turn up.

Thérèse Coffey: Julian’s wife is giving birth today.

Mary Macleod: A good excuse.

Marjorie Strachan: Exactly. Personally speaking, we already talked about the discrimination element. I think sometimes we can go too far in badging it as being for women, as opposed to it just being really good common sense for how we manage people effectively. A product of that is, we get the right gender balance, because women can bring more to the workforce at all sorts of different levels. There is a lot of research into the point that women, thinking off the top of my head, the McKinsey research published a few years ago, which talked about gender balance on teams. I think the number was roundabout 30% being the tipping point where 30% on teams makes a difference to the types of decisions the team make. Or 50% of mixed diversity teams being higher performance teams. That is the type of thing I think is more credible than simply seeing it as a bandwagon for more women per se. Because the last thing we want is a gender

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piece, a gender quota piece, let us just appoint women so we get the right statistic. But actually what happens is the organisations don’t perform because the wrong women have been appointed.

Q48 Thérèse Coffey: Ultimately business is about cash, the return to your shareholders or your investors or whatever it is. How often does this topic come up would you say for investors? We have got the CEOs of Blackrock, Legal & General and Newton all coming, so we are going to approach them. But I was just wondering, does it ever come up that you are aware of?

Nigel Whitehead: I am not aware of it.

Thérèse Coffey: Okay. The evidence is still building. McKinsey made a link though Cranfield was a bit mixed.

Marjorie Strachan: Yes, the return on equity and return on investment piece. It comes up for us at the moment in our annual reports and in our sustainability report. At the moment that is about providing facts and figures. Where I see the emphasis shifting is into more the return on value and actually, there is really good evidence for why we want the right people, and improving our gender pipeline will help us to find some of the right people. Are we far progressed along that? Not yet, but I can see that becoming the slant of the conversations, as opposed to “let’s just get the right number of women into our teams”. It is more business anchored, it is more commercially anchored.

Q49 Andrea Leadsom: Very specifically Marjorie, did you see the research that suggested that behaviour in investment banking was significantly tempered by lower female testosterone levels of female dealers? It was actually a serious piece of scientific research that sought to suggest that the blowing up of investment banking wouldn’t have happened if it had had more of a gender balance. Is that something you have looked at? Is it just laughed at, or is it of interest?

Marjorie Strachan: It is of interest, but it is difficult to answer the question because who can genuinely answer it?

Q50 Mary Macleod: I suppose you could say if Fred Goodwin had more females around him, would it have ended the way it did? Who knows?

Marjorie Strachan: Who knows? But is there very good research which says that high performing teams are a mixture of diverse backgrounds, diverse experiences? Well yes there is. But does that answer that specific question? Well no, and I don’t think anyone can.

Q51 Thérèse Coffey: Have you ever sacked a recruitment consultant because they are not giving you what you want? A list of twenty men?

Anna Fullerton-Batten: Well I have an interesting situation at Microsoft, because we have a vendor that delivers recruiting. You can’t measure them based on delivering females to males, so there is no actual measurement put in place to ensure you are getting that.

Q52 Thérèse Coffey: You don’t have a, not a quota of people, but a quota for a panel?

Anna Fullerton-Batten: Say for example just getting women’s CVs at the beginning, female CVs, you can’t measure them, because it is discrimination.

22 Corrected Oral Evidence- Session 1

Q53 Thérèse Coffey: Is it? I am interested to hear you say it is discrimination to measure it.

Anna Fullerton-Batten: Not to measure it. If they were proactively putting them into, I guess getting them into the pipe it could be discriminatory.

Q54 Thérèse Coffey: It is clearly different views then, with BAE it sounds like you do.

Nigel Whitehead: Well we have aspirational gender targets, and actions to help us achieve our aspirational gender targets; we have not implemented specific measures about which gender to appoint.

Q55 Andrea Leadsom: Well quotas may be illegal, but it wouldn’t be illegal to say we would like the CVs to reflect the general population balance gender-wise. I mean that wouldn’t be discriminatory at all.

Anna Fullerton-Batten: That is the language to use. When we brief the teams, obviously we look at internal candidates as well as externals, it is up to us to then follow through on the gender ratio, there must be one woman on the shortlist for example. But we do talk to our suppliers in the same way as you mentioned about wanting the balance to reflect the broader society but it is more difficult to target financial incentives based on their ability to do that – it is a fine line.

Q56 Thérèse Coffey: I am interested because of the measure, coming from manufacturing, where basically you have a confused mindset, that you can’t improve anything unless you control it. You can’t control it until you understand it, you can’t understand it unless you measure it. There is an element there of building measures in, because you don’t know what is the impact of having a woman’s network or whatever it is, as opposed to throwing stuff at the wall, hoping some of it will stick.

Anna Fullerton-Batten: I agree and it is generally acknowledged that we know that “what gets measured gets done.”

Q57 Mary Macleod: Is there anything that you think the government should be doing more to help or highlight? Actually you run your businesses, so absolutely we don’t interfere there, but is there more that we could be doing? Whether it is on things like flexible working, or whether it is just highlighting the issue?

Nigel Whitehead: If I may? The school subject contents of the curriculum. The emphasis on the science and engineering activities, from our perspective, and breaking down some of the barriers in relation to the gender segregation associated with those. Measuring schools with relation to how many of the pupils are actually going to do those subjects. Careers advice specifically is broken, skewed and is prejudiced. Encouraging the media to actually report some of the true stories and develop some of the themes that we have been talking about, actually getting proper consciousness more actively, apprenticeships, generally more specific. All of those areas would actually improve.

Q58 Mary Macleod: Anything else to add?

Marjorie Strachan: That is certainly a good point about the school information, supporting schools to provide much better information I think. As a mother of two daughters going through curriculum decisions right now, it is not clear that sciences are very important.

23 Executive Women in the Workplace Inquiry

Anna Fullerton-Batten: I like the idea of the Female Future Plan, I’m not sure if that was government-led or driven, but basically the training network programme, the companies identified three willing candidates to take part. Of the six hundred women who have successfully completed the programme, 60% have gone on to join the regional boards. I’m not sure if that is a government-led initiative?

Mary Macleod: What was it?

Anna Fullerton-Batten: The Female Future Plan in the Lord Davies report. It talks specifically on the section on Norway, in terms of what they did to drive change. Additionally, part-time working, parental leave was a point and working hours in general.

Q59 Thérèse Coffey: Sorry to step back a bit. Marjorie you mentioned the unconscious bias training you have at the start. I must admit I’ve heard about this but never come across it. I’m now thinking of getting somebody in to do it for us and also our parliamentary party. Could you let us know within your business, is this now an active thing that people of a certain zone and above have to do? Is it a requirement effectively of all management levels, a certain level?

Marjorie Strachan: It is not a requirement no, not yet.

Thérèse Coffey: But we might encourage your Chief Exec to say that would be a great idea. Okay.

Anna Fullerton-Batten: The value of unconscious bias is that it is a science. They talk about fight and flight response, and unconscious bias is linked to, it could be any bias, it is not just women. You take a survey which assesses your affinities and biases, and because it is based on your background or childhood and early influences your reactions are instinctive, so there is no direct blame attached. It is easy to have the discussion with men or women about any of their biases without pointing fingers, which is why it is well received training and often encourages very open discussion.

Marjorie Strachan: It is actually quite interesting when you see people go through it, when you see the light bulb going, they recognise, “oh crikey I have been doing that actually but didn’t realise”. It can be as simple as how you describe an application or a job advert which would put perhaps women off applying, to the whole decision process that a hiring panel makes. It has got quite a nice –

Anna Fullerton-Batten: If you uncover it, you start by taking the tests, you uncover bias and then have a discussion about it. It creates really interesting broad discussion that people may have bias towards any group of people.

Mary Macleod: We certainly felt it, although again it was a very subtle thing, but politically in selecting more women into Parliament. It was the women who weren’t supporting women, but it wasn’t a conscious thing, it was subconscious, that a 40 year old man with two kids that was selected.

Thérèse Coffey: The Conservative party itself has this, I think we are continuing it, certainly in later selection processes it was 50/50 to get more women in front of a selection panel. It didn’t mean you had to select them, but definitely I think we had to change the culture.

24 Corrected Oral Evidence- Session 1

Andrea Leadsom: Yes, that is very much happening now. Sarah Newton has been doing exactly that.

Q60 Thérèse Coffey: That is a great example. Is there anything else you want to add before we close? What have we missed? I’m flicking through different things, but I think we’ve covered most of it. Is there any other company you admire, what they do?

Anna Fullerton-Batten: Google. They have a great diversity profile.

Q61 Thérèse Coffey: Nigel, is there any other company you admire?

Nigel Whitehead: Not that I’m aware of in my sector. I would say US companies have been investing in unconscious bias training for much longer, and is very much part of what we are doing. I speak to personal risk and see what is the outcome of this further on.

Q62 Thérèse Coffey: Okay. Marjorie?

Marjorie Strachan: I would share your Google, I would also perhaps have said Microsoft, I may catch up with you afterwards. Also as well, Diageo is a company that springs to mind.

Q63 Thérèse Coffey: Indeed. Are there any other questions you’d like to raise? Can I just say thank you so much for coming along today, I have found it fascinating. It is definitely a common theme of where you’ve seen progress change as well, so it gives us food for thought. I think you know we have got a series of these sessions with a mixture of people coming to give, we will make sure that we do is certainly we will send you a copy of the information taken down. Unfortunately I managed to mislay my voice recorder over the weekend.

Mary Macleod: Please feel free to send us anything in the meantime, do feel free.

Thérèse Coffey: Can we write to you if there are things that come up?

Nigel Whitehead: Of course you can, yes.

Anna Fullerton-Batten: Yes.

Marjorie Strachan: Sure.

Thérèse Coffey: Lovely. Thank you very much.

25 Executive Women in the Workplace Inquiry Corrected Oral Evidence- Session 2 Tuesday 22nd January 2013

Members Present: Sarah Newton MP (Chair) Amber Rudd MP Baroness Wheatcroft Harriett Baldwin MP (QQ73-144) Mary Macleod MP (Q145-end)

Witnesses: Kate Grussing, MD, Sapphire Partners Karoline Vinsrygg, Consultant, Egon Zehnder International Charlotte Crosswell, CEO, Nasdaq OMX NLX Rebecca Salt, Group Communications Director, Balfour Beatty PLC Jill May, former MD, UBS Evidence:

Kate Grussing, MD, Sapphire Partners Karoline Vinsrygg, Consultant, Egon Zehnder International

Sarah Newton: Thank you very much for giving up your time. As you know what we are focussing on in this enquiry is not so much the representation of women on boards. What we’re particularly looking at is executive women and really looking at the pipeline. So women from a junior management job in an organisation, how we can nurture them into very senior positions, right up to being a CEO and that’s really the focus of our enquiry. Most of the people we are speaking to are actually from companies or organisations themselves. Of course, it’s really important to speak to the executive search organisations because you are gate keepers from one point of view or enablers from another point of view. But obviously you have a critical role in this process. So we’d really like to start off with questioning around your role in the whole landscape. Of course in the course of the afternoon if there are some points that you would like to make and ask the questions, then do chip in or if you wanted to send us a written follow-up – you know, some research or follow up information, but don’t have it to hand, then that’s absolutely fine to do written evidence as well. So, can I ask Amber to start off?

Q64 Amber Rudd: Yes, so can each of you, if you wouldn’t mind, just enlighten us, if you are given a search for an executive position in a main board, how you would go about doing it. Just set the scene for us, if you would, so we can start to see how it takes places and how you would ensure that the women are represented in that search along the way.

Kate Grussing: Can I just clarify? In your question you said, “main board.” I assume you mean a search for an executive role?

26 Corrected Oral Evidence- Session 2

Amber Rudd: Yes, that’s exactly what I mean.

Kate Grussing: So, putting board roles to the side?

Amber Rudd: Okay, fine, yes.

Kate Grussing: Perhaps it makes sense to start with someone who approaches it form a gender- neutral perspective. Since a lot of what makes Sapphire different is our focus on senior women. Then I can elaborate how we differ.

Q65 Amber Rudd: Okay, that’s true. So if you’ve got a senior executive position to fill, how would you go about doing it and how would you ensure that there was a woman on the board? Or would you not do that? How would the issue of gender diversity feature within the search that you’re doing at an executive level?

Karoline Vinsrygg: Right, I’m just thinking about where to start. If we think about a normal search process, the way we normally work is that we have a client. The client says, “we need a CFO for our metal business. We need these kinds of experiences and the team looks like this and this is the kind of person that we would like to have in the role from a culture perspective. You know, who is collaborative, who is strategic.” You have a definition of the role and what you look for. I think when we already now think about diversity, already at this stage, there is a lot of unconscious biases going on and the definition of the role and who the client sees coming into the role and also who we see coming into the role.

Q66 Amber Rudd: So, do you think the client has got in their head at that point, a picture of someone, just like Bob who just left?

Karoline Vinsrygg: Yes, probably. That’s quite clear. Then they probably think, “okay, they would like him to be a bit more strategic and it would be great if he was collaborative like Bob.” That’s generally how – you compare it to the person who came in. Very often that would be a male going out and they would think that that a male would come in. So, already in the language we use at that stage and the sort of conversations, it’s very easy to go into the track of thinking in our head as well, “okay, this is the kind of person that we think about already of our candidate.” But that’s the first stage. We can talk about what we are doing later, to sort of make this more a neutral stage, but that is stage one. In stage two, what we do as search consultants is we would start – so we have made the role spec and we have started the project and we would brief research, so I have Amy with me here who works with me in research. What we’ll do – sometimes she’s part of the client meeting and sometimes not, but at least we’ll sit down, we’ll recap what was said, “this is the kind of person. These are the kinds of companies where we would like to look for the person. This is where the client pool is, this is where we think we can find the candidates.” That’s one side of it. The other one is thinking, “okay, who do we know who could have good ideas?” What we call sourcing or finding sources. That could be, sort of, hired candidates of ours, anyone who is friendly to Egon Zehnder and would like to help us in our search. That’s another point where we tend to go to people we already know and historically, more male than female. But anyway, that’s that stage. Then research works on finding candidates through the desk research. I as a consultant start calling sources for ideas and we come up with a longlist of ideas that we discuss with the client. We say, “okay, we have these forty ideas.”

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Amber Rudd: Forty people?

Karoline Vinsrygg: Yes, and we have profiles of them which generally say what they have done, what kind of roles they have, what vocation they have. There will be a name to them. It will not have an age because that’s not by law, but we tell them if it’s a man or a woman. So you have some facts and if we know them then you also put some colour to the profile. So, you talk through with the client and perhaps the client says, “okay, of these forty, I like fifteen. I would want you to call these fifteen people.” So that is another part of research where there is both consciously and unconsciously, we make decisions, both on our end and specifically on the client.

Q67 Amber Rudd: Say you’ve got a CFO for a mining company and a lot of them have very, very low numbers of women on the board. The client says, “I would like to see these fifteen,” and all of them have got the first name Bob, or something similar. Do you then say, “have you not thought about the fact that you might want to see a selection of women?” Do you then offer that as part of the process? Or do you point out that the board at the moment doesn’t have a single – at what point does the conservation, perhaps, have a specifically gender issue about it?

Karoline Vinsrygg: I think what is quite new, which we’ve seen in the last few years, is that Egon Zehnder and other search firms, we are starting to become more proactive, both in what I call phase one, phase two and now phase three we’ve gone through the longlist. In phase one we will say, “we would like to –” and if the client doesn’t say it him or herself, we will also make an effort to come with diverse candidates on our longlist of our ideas. Already in London we have agreed on guidelines with research and as consultants that we will proactively seek in phase two of looking for candidates, to find diverse candidates. We are now, and have done for some time, also being much more – trying to be as pushy as we can with clients, in the balanced relationship of saying – say it’s a “her” if we use women as the diverse group today – “let’s try and at least meet with some women, that might be left field ideas because they have slightly less experience or because we know them less or because they come from a different industry, but we would like you to include in the group of fifteen.” Most of the time if the client doesn’t ask for that him or herself they will be quite receptive to that. So, say we agree on fifteen people, then stage three of whom to approach, I as the search consultant will call these fifteen people, try to talk about the role with them and get a sense of if they are interested and if they are qualified. Then let’s say I interview eight of them that are interested in qualifying based on my initial assessment. That’s another place where there are conscious and unconscious biases, of course, because I think then decide, “of these eight, I think that five are alright, and should be presented. These are the five that I should present to the client.” Then the client meets with the five and decides, say, on the shortlist of two or three that the client wants more, or the client’s representative to meet with. Then finally in the ideal search they agree that this person is the best person, at which point and sometimes also before, we as search consultants will also do referencing. So we will call six to eight people that know them well. That’s the last stage of the phase. There is an offer and they sign it.

Q68 Amber Rudd: Just one more – it’s in the interest of the headhunter obviously to make sure that the deal closes and so you are not in the business of – you are not an NGO, you are not a charity. If your client says to you they want the right person for the right job and with that they may have their own prejudices about wanting someone like Bob. I mean, how do you – do you sometimes have quite tricky conversations trying to say to them – at what point do you push it to say, “you really ought to notice that you’ve got no women at senior executive level?” Or, “you need to increase your pipeline.” Do you find that is part of your job? Because you just want to close the deal and get paid to a certain extent.

28 Corrected Oral Evidence- Session 2

Karoline Vinsrygg: To start with the latter part of the question first. Just to – because you are probably not aware but at Egon Zehnder we have a payment model where we agree on a fee upfront. Say it’s £100,000. That would be paid normally over three months, regardless of the outcome of the search. Regardless of if there is a person hired and regardless of what he or she is paid. So in many ways we don’t have – other than our honour and our relationship to the client, we don’t have a financial incentive to have them sign the deal with someone, which is quite unique for the search industry. But that hinders me at least from having a view of, “I just want to close the deal with whoever it is.” So that’s put that to one side, and then we talk about how to find the best one. I think it’s very important to have those sorts of conversations early on. When you are there with three people, shortlists almost done, that is too late. You need to start very, very early on and discuss it with the client. I think it’s much easier now because of what is happening on board level where you are seeing in the papers all of the initiatives and quotas, everything that is going on. Everyone notices that there is much more attention to gender balance of the executive team and of the board level in a company. So, the conversation is much easier than it used to be. For example, actually it was quite interesting or funny this morning, because I received an email from one of my clients at the very early stages of the search. He is on the board of a large FTSE company, industrial. He wrote to me, “I just thought about the fact – we didn’t specifically discuss it, but please let me make the point that it’s very important for us as a company that we recruit diverse people so can you please bear that in mind when you now start your search,” which was interesting for me from two perspectives. One, that we hadn’t – I hadn’t succeeded in actually talking about it with him, but also I was just very happy that he sent that email. It wasn’t the HR director, it wasn’t a woman. This was a 55 year old man on the board of a FTSE company that sent this email on his own.

Amber Rudd: Excellent.

Karoline Vinsrygg: But yes, I think as early as possible to have these conservations so that it’s just a shared expectation that there will be women on the list, on the people interviewed, of the people presented, so that they start getting into the conversation and into consideration as well.

Q69 Baroness Wheatcroft: You can have the conversation, but the problem always seems to me that there is a lack of potential female talent for these jobs. On the whole, the talent pool is not there and there are very many reasons why that might be and your background is very unusual. You came in the maritime industry, which is not I suspect overly peopled with women. But am I wrong in the supposition that there is a shortage of women who want, or are qualified for – but I stress, “who want” – these sorts of executive roles?

Karoline Vinsrygg: I think that’s a big discussion you are opening here and it has lots of – it can go in many directions. But to try to start answering your question at least, and then we can have a discussion around it, but to get women onto a board, that’s quite, as non-executive directors, that’s a quick-fix if we simplify it. You can nominate someone and you can look globally and you can find them tomorrow and they will be there. It may be difficult sometimes but you will find them and you can put them on the board and you’ve solved the problem. To get women into top executive roles is much more difficult because it’s not someone you nominate overnight, and really to take someone from being a young talented analyst coming out of university to becoming a CEO or a CFO, that takes maybe twenty years. That’s twenty years of getting them the right motions, the right training, the right flexibility when women have children, the right incentives to come back, the right motivation, the right support. There are so many choices and so many influences during those twenty years before you come to that level. So, so many things can go wrong. I don’t

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think personally that it’s because women don’t want to have a CEO role, necessarily. But I do think there is definitely something around motivation, something around what they are willing to sacrifice and also what they feel is expected that they sacrifice. Not necessarily what they would have to, but what society, their peers, their bosses expect them to do and have expected them to do, historically, that makes men and women have different motivations and aspirations about their executive careers. Then I think it’s also about role models, who do you think – who do you see in front of you that have done this before you? There are fewer female role models than male role models. At the same time, I think when we compare today versus thirty years ago, we definitely have more female role models than we had then. So it’s all the development, it’s just that on the executive side it takes so much longer to get there because, as I said, it’s a twenty year challenge.

Kate Grussing: I think the supply of women executives, no question, is smaller than the supply of male executives but I think that it is more than sufficient. I think the rate of women getting that executive qualification in the last ten years has really been significant. So I think actually the time for the government, the media to be focussing on this is fantastic. I think ten years ago it would have been premature. But women have been graduating with the majority of undergraduate degrees and graduate degrees, getting accountancy qualifications, CFA qualifications for a significant enough period of time. So to be honest I appreciate I’m in a slightly privileged position given what I do at Sapphire but there is a very strong, robust pipeline of women ready to be appointed to executive roles. Now that’s not to say – there are some women who take themselves out of it, but the vast majority of women executives today have made the decision not to prioritise children. Many of them don’t have kids, or if they have kids they might have a househusband. So the issues around the choices women make, if you are very successful man in business, you often have to make those choices too. But I think that the issue of women not looking the part is a really important one and I think some of it is – the women are harder to find. If the headhunter is remunerated, really the upside in their compensation is to place someone. Well the women are probably going to be harder to convince to move companies. They are less likely to move for a bigger pay packet or a corner office. [Laughter] They are more likely to be very loyal, which is why they are such great investments. But if you’re a traditional headhunter, not an enlightened headhunter, the women candidates are going to be much less responsive. As a headhunter one has to spend a lot more time convincing a woman that she is good enough, saying to her, “I’m sorry. Your CV does not speak to your qualifications. We need to rewrite that.” Whereas a man’s response would be much more, “what took you so long to find me?!” [Laughter]. You’ll have his CV on email by the time you hang up the telephone. The woman will want to take the weekend or the week to polish it, perfect it, and send it through.

Q70 Amber Rudd: So you think it’s more – if we had to choose between supply and demand?

Kate Grussing: No question. It’s a demand issue. The supply is smaller than the men, no question, but we’re not talking about thousands of people here.

Q71 Baroness Wheatcroft: So what you are really saying is that you do believe that discrimination still operates and to a certain extent, women don’t necessarily make their case as well as they could or should, and headhunters can advance their case but there is still discrimination at the employers’ end.

Kate Grussing: I don’t like using the word “discrimination” because that sounds to me quite overt. I think some of it is the women making bad choices. So for example, moving into an HR role. Now there is no question that we need really high quality professionals in HR. The vast majority of HR

30 Corrected Oral Evidence- Session 2

professionals are women. Companies are probably more likely to promote someone who is in a sales role or a marketing role or a financial role. So, I agree entirely with what Karoline said. I think there are huge elements around unconscious bias too. So the women make, at every point in the pipeline, the women are making the wrong career decisions, women not going for that extra qualification.

Q72 Amber Rudd: So do we need to persuade the women – do the women need to be persuaded or mentored in a certain way to make better decisions? Or is it that the chief executives that are doing the hiring need to look away from the traditional, “he must have done this, that, five years aboard and four years here”?

Kate Grussing: I think being far more open-minded about experience competencies is incredibly important. If you look at where so many of the most talented women have gone in the UK, they’ve gone into the professions.

Amber Rudd: They’ve set up their own businesses.

Kate Grussing: We have a lot of women in PR, in accounting, in law.

Amber Rudd: In headhunting! [Laughs].

Kate Grussing: In headhunting. Not what I’d call typical corporate career paths. It’s interesting. I’m pretty active in the Association of Women Entrepreneurs in the UK. I think not nearly enough women go into running their own businesses and those that do typically are not sufficiently ambitious and under-capitalise, and approach it more from a lifestyle standpoint, instead of thinking about, “I want to get venture capitalists and how can I build this business quickly?”

Q73 Harriett Baldwin MP: What about the fact that - and I apologise for coming in a bit late, what about the fact that so many more roles these days involve working in global firms and getting international experience. Do you find that the need to spend some time in a different country or several different countries is more of a barrier for women in their executive progression than it would be, perhaps for men?

Kate Grussing: No question. Having international experience is perceived as a real extra tick in the box or qualification for professionals and the women are more likely to have turned down international assignments, or not even been approached for them. So that’s, I think, a lot of the unconscious biases. “Let’s not ask Mary if she wants to go to Beijing because she’s just returned from maternity leave.” Mary might have jumped at it or Mary would certainly like to have known she was being considered for it. So the combination of either family responsibilities or the husband – I know a lot of very senior women who don’t have families who still are in this bind. I know a very senior woman at one of the UK’s biggest companies and she told me last week that she turned down an international assignment quite recently in the US because of elder care responsibilities. She is one of the most high profile women and her company was stunned. She said she couldn’t believe that they didn’t appreciate the importance of elder care responsibilities in the same way as someone who might have had parental responsibilities. She did wonder, “if I was a male executive, would I as the male executive feel that same responsibility?”

Q74 Baroness Wheatcroft: What do you think the answer would be?

31 Executive Women in the Workplace Inquiry

Kate Grussing: Well I think hopefully her company is sufficiently enlightened that they will ask her again. Right now she feels like it is a tick against her and it shows that she’s not sufficiently ambitious and she’s not sufficiently dedicated to the company. This is someone who has been in her company for over twenty years. You know, it’s certainly been a hit to her and the confidence she has in the leadership of the company.

Q75 Baroness Wheatcroft: But if a male had turned down that promotion, that opportunity on the basis of elder care responsibilities, how big would the blot on his copybook be?

Kate Grussing: Well it’d have the same impact. I agree with you entirely.

Baroness Wheatcroft: Well it might be even greater.

Amber Rudd: “Big girl’s blouse,” sort of thing.

Q76 Sarah Newton: Could I ask you some questions about some of the comments you were making about, “you’ve noticed some improvements.” You mentioned that you think it was largely to do with the media, or the media has had an impact. Because you were saying your clients were reading so much about business that do have more females on boards and females executives are better performing businesses. So, there has been quite a lot of research and media coverage about this. Then on the other side, we’ve got a fear factor that maybe the EU would come in and insist on quotas. So what role do you think the media has got in both highlighting role models and encouraging more women? But also speaking to men in senior positions about perhaps what they are missing out on and encouraging from that point of view?

Karoline Vinsrygg: I think it’s a combination of factors. If I use my experience: I am Norwegian and lived there until 2004. In 2002 I was working for an industry organisation in shipping and that’s when the quotas were launched. It’s just been quite extraordinary when I look back and I see the development from that time and the uproar and the anger and the really heated debate in Norway at the time. You can debate for and against quotas but I think that it started a revolution. Whatever happened in Norway at that time, it really started a revolution in the boardrooms in Europe. It has taken time but ten years later it’s in Europe and that didn’t happen over night. I think it’s been very gradual and it’s been a combination of factors and it’s been policy groups, it’s been female groups, it’s been students and young people and women just expecting that there will be change. It’s been the media and it’s been employers that realise that this is not the way forward. That we basically say that, “50% of the talent pool is not going help us grow our women and become more successful as a company.” So all of this, I think has really developed into what we are seeing now. We have a pressure that is from politicians, from young people, it’s from women in business and it’s from the media. Many others, it’s from the research industry ourselves. It has so many stakeholders and I think it’s a combination of pressure and to point to your question, yes, I think the media is very important in this because they, of course, have a role as being able to showcase what a situation is. It could help build up a woman and show how she is successful. It can also help showing women who are not being successful, maybe unfairly so. It can of course also showcase and highlight men being promoted or men doing jobs that are not up to par that they wouldn’t have been accepted if they were women. There is lots of the stuff media does and continues to do which I think is important.

32 Corrected Oral Evidence- Session 2

Q77 Baroness Wheatcroft: Do you think that the jobs that we are actually talking about are sensibly constructed? For instance, most senior executives in international firms spend a lot of time travelling. Do they need to? Video conferencing is perfectly effective now and yet there seems to be a determination to get to the airport and get on a plane and I just wonder whether you see scope for these executive roles to be gradually redefined so they that become more user-friendly?

Kate Grussing: I think men and women face the same challenge. There is no question that the role of a corporate executive is more 24/7 than ever. It’s in a company’s interest to leverage technology, but if you are a big, global company, a huge amount of this is about building relationships. If you are a chief executive, you shouldn’t be managing MD of that business. You should be making sure that you have the right people in the right jobs. I haven’t met Cynthia Carroll but I heard someone describing how they heard her speak quite recently. She is stepping down as the CEO of one of the mining companies and apparently she spends every week on her company’s corporate private jet going around the world. It speaks volumes if you are a mining engineer in Zimbabwe or Brazil to know that the chief executive is there asking you about your health and safety procedures, asking you in person. So I think there is no question, the best executives are looking at technology much more and there are phenomenal systems like tele- presence which enable companies to do this. Certainly I think something like the Olympics was a great illustration also of how much you can do remotely. There was a huge drop in corporate travel during that period.

Q78 Baroness Wheatcroft: I mean, the first meeting has to be face-to-face. Relationship building, as you say, is incredibly important. But once the relationship is there, then you can do things remotely.

Karoline Vinsrygg: I’m not sure if there is a quick-fix though. Yes, a lot more can be done with various forms of communication and you can do stuff more efficiently. But at the same time the world is becoming more global and for many of these roles, the companies are also becoming more global, actually taking on more countries. So it’s a bit both ways and I don’t know if there is a – I’m certain there is no easy solution to it, but actually I believe more than looking at the foundations, maybe earlier in the career where this is not the biggest problem for a CEO from a family standpoint normally when they are 52 or 53. It’s much more of a pressing issue for someone who is 35 and has a small child, if we generalise. I think it’s linked to my Scandinavian roots but I feel that the question about childcare, of making sure that there are options for women to go back to work, if they go back to work after six months, that there is actually – that they have a right and at least easily can find affordable childcare, so that they can go back to work. Because that is the problem that most women are facing, and that is what is cutting down the pipeline to women when they are 52 becoming CEOs. Because at 35 they had to take on difficult choices that meant that they excluded themselves from their career.

Q79 Amber Rudd: But what Kate seems to be saying, if I may say, is that because that has become part of the truth about women, even for the women who decide to run their families differently or indeed have no children, they are impacted by that judgement. Is that correct?

Kate Grussing: Very often, yes. So the London Business School has done some really interesting research showing how women often aren’t given those stretch assignments. So typically before you are even considered for a promotion, or a headhunter is going to come and pluck you for another role, you’ve proven yourself and you’ve done what’s called a stretch assignment. So maybe your company has acquired something in another part of the world and you go and parachute in the company’s high flyers. Women typically have not been approached. So, the best companies today

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are taking a look at all the different systems across – when they hire in people as graduates to when they promote them and looking at where the pipeline is leaking. I do agree that the pipeline leaks at every stage. Some of it is the women opting out, but I do concur. I think a lot of it is the women being overlooked and in my experience that’s often because people tend to recruit in their own image, whether you use a headhunter or whether you recruit internally. So the men are often recruited because if I’m Bob, Jim looks like I did ten years back. So, the potential candidate will be recruited – he may have insufficient relative experience, but he is perceived to have the potential. Whereas the woman is recruited if she has actually done that job and she has the performance, and so she is much more rarely recruited purely on potential.

Q80 Amber Rudd: Do you think there is also a judgement going on, which is, “Jane is a bit better Bob. She’s 32, 33, she’s just got married. [Whispers] Let’s not take the risk.”

Kate Grussing: Oh no question. There are obviously some very high profile examples in parliament quite recently of a woman stepping down. I’m sure you know her, Louise Mensch, and as much as she is very different from a lot of women out there in the UK, that will have permeated thousands and thousands of male hiring lines.

Amber Rudd: Yes.

Kate Grussing: So I think on the flip side of the UK getting much more generous about maternity leave and our flexible working allowances, especially if you are running a small or medium sized business, is you look at Mary who is 35, and you are worried, “is she going to have another kid? Is she going to want more time?” Whereas if you have Billy who is 35...

Amber Rudd: No risk.

Q81 Harriett Baldwin: Can I just probe a little bit on the Norwegian childcare nirvana that you mentioned earlier, and here you make the argument for why that makes it easier for women to get to board level. Because the counterargument to what you are saying there would be that actually if you have such good childcare that is really close to where you happen to be that would be something, that might make you turn down these international assignments or these other opportunities. Things like that, in terms of career development, so duties, so I just wondered how it works and how you see it working. Is there a tension between –

Karoline Vinsrygg: Well I think that if you look at the picture around where you live in your job right now, if you have a child and you’re six months or whatever it is and decide, “I want to go back to work.” I think it’s very important in that decision will be, “is it possible for me? Can I afford it? Is there childcare where I can place my child?” So that is that part, and I just think that is fundamental for women to have that. This is based on my board experience, but it just means everything for whether they can choose executive careers. Is that going to be counteractive versus choosing international careers? I’m not sure because very often when you do get placed into an international position, you are in some form or another coming up to the ladder a bit and you are on an expat’s deal of some kind. So either you will have a nanny or you will get a childcare where you go and work, as part of the deal. For school, something will be arranged with your company so I don’t think that normally – of course there are exceptions, but I don’t think that’s normally what is holding women back. It’s probably more that they have a husband who is also ambitious and also wants to think about his career and as a family decision because of how with the in-culture and history, very often it’s the man’s careers who gets to be the prioritised career.

34 Corrected Oral Evidence- Session 2

Q82 Harriett Baldwin: Are there stats in Norway on much higher levels of female participation at all levels in terms of the workforce?

Karoline Vinsrygg: Not when it comes to executives – the top CEOs, there are not more female CEOs than other places, but then again childcare, very generous childcare is newer in Norway as well. So I think it will take longer and it’s not the only factor. But yes there are many women on lower levels and mid levels. Also, as we know, at board level there are 40% women. So the one layer that is still missing is the CEO or senior executive. When I was on an executive board or a supervisory board, I was the only woman on the executive board and then on the supervisory board I was one of 40% because that was the law. But on the executive level, definitely I was the only one. They were men in their fifties and myself and that is normal.

Q83 Sarah Newton: Can I just say, we’ve only got fifteen minutes left and we really did want to talk a bit about the Cranfield research and the voluntary code for executive search firms. So if there are some other comments you wanted to make, you might like to weave them in, in answers to that question. But there has been some criticism of this voluntary approach, is it really working? There are particular areas that I’d be interested to know whether you’ve ever been involved with a client that has ever asked for an all-woman shortlist and typically what percentage of women are on shortlists. Then finally do you think the actual processes that you’ve described, if there was more focus – we’ve certainly found this in the Conservative party – on the way that we enable people to go through becoming candidates for it. So if it’s far more focussed on competencies. We have a lot of success of taking the gender out of it because we are really encouraging people to look at the core competencies. That seems in our case to enable more women through, do you feel that would help?

Kate Grussing: I’m happy to start with that. I think certainly the code is helpful but it’s by no means the be-all and end-all. I think any well run search firm would have been doing what the code encapsulated long before. So I think the search firms that perhaps recycle lists and just use their own boys’ network perhaps have been encouraged to be a bit more thoughtful and creative, I think, as a result. I do think that transparency is incredibly important and so I don’t believe Government has the answers to all of these issues but I do think that Government has a really vital role to play in terms of making sure that there is benchmark and reporting and transparency. If you look at how successful the Government – or as you said, the selection of MPs has been – it’s because there is great transparency there. That does not exist in the world of executive appointment or non-executive appointments in the private sector.

Q84 Amber Rudd: It doesn’t exist?

Kate Grussing: Correct, yes.

Q85 Amber Rudd: Because it’s confidential between you and the client?

Kate Grussing: Correct.

Q86 Amber Rudd: But still, isn’t it one of the reasons why FTSE companies for instance always want to use a headhunter, even though they know they want to poach Bob, is because they want the transparency of having a full list and they will want, particularly in this climate as you were saying, to be seen to be having women on the list. Isn’t there more transparency at least within a slightly closed group than there was?

35 Executive Women in the Workplace Inquiry

Kate Grussing: Certainly it helps their governance look more robust, no question.

Amber Rudd: Yes, governance is what I’m talking about.

Kate Grussing: So, inasmuch as companies are doing a much better job, for example, to report evaluation, that is a good thing.

Amber Rudd: Absolutely.

Q87 Sarah Newton: So, rough percentages?

Kate Grussing: 80% of Sapphire’s placements have been women. Now there is a bias because companies that are interested in this, that are prioritising the recruitment of senior women, are those that are more likely to come to Sapphire. Those that couldn’t give darn are going to go to other firms. But certainly there is a big challenge because a very small group of search firms do monopolise a huge portion of the executive appointments. Clients tend to turn to the search firm they’ve always used. So even though search firms I would say have been part of the problem, the clients are still turning to the same firms. When we often are told why Sapphire hasn’t been chosen and another firm has been chosen, it’s because the other firm did the last five clients.

Q88 Baroness Wheatcroft: How much do you feel that it’s incumbent on you to work with women and develop them? You pointed out that they don’t always market themselves terribly effectively. They don’t think they are qualified. They see the negatives. Can you actually actively work with them to bring them up to the level that they need to be in putting their best face forward?

Kate Grussing: Absolutely. I don’t think all headhunters do, but there is no question. There are many headhunters who do go out of their way, coach women and have confidential conversations. The challenge is that pretty much 100% of the revenues of a search firm come from their corporate clients. So I don’t have enough hours in the day to see every woman getting in touch.

Q89 Baroness Wheatcroft: Do you think companies should invest in coaching all of their women employees?

Kate Grussing: A lot of companies are investing increasingly and I think it’s a really good thing and I think they need to invest in it for the men too. So this isn’t just about fixing the women.

Q90 Baroness Wheatcroft: Is it better than mentoring? Is it more effective than an informal mentoring system?

Kate Grussing: In my experience, yes. Coaching is much more tailored to what does that individual need and that coach is there to help that person achieve their potential and mentoring is often one of 500 other things that a senior executive has to do.

Karoline Vinsrygg: I think that is part of it. One other thing, I don’t have an opinion on coaching versus mentoring, but another side I think can be important to look at is on-boarding. When a woman, or any executive, but say a woman is hired as CFO of this money company to do everything, as a search firm, what can we do? I think that’s a role we can play. We can work with the clients and the woman to make sure that she is successful. That is about making sure that we

36 Corrected Oral Evidence- Session 2

know as much as we can about the team and the organisation that she’s coming into by talking 360 to the whole team and giving her as much information as possible. Talking to the woman and preparing her on this and also preparing the team for what she is and what she represents. So that she is as much as we can set up for success because it’s so crucial. The first three months she’d come into work, her job, that really sets the tone. If you come in with as much information as you can and ready to go with confidence and knowing also, “he’s difficult,” and the unhidden codes that you may not know before you have been there for three months. If you know this coming in, your expectations for success go up so much. That is an area where we are now increasingly doing more as well.

Kate Grussing: I very much hope you will ask the corporate witnesses who appear what they do to help the women internally, and also what greater transparency they can have. Because, often, a senior appointment may be made where none of the women in the company will have known they needed to lobby and put their hands up. Increasingly as corporate are tightening their budgets, they are using headhunters less. They are trying to do it more directly, or they are using contingent headhunters, which means that they don’t retain Egon Zehnder or Sapphire. So the challenge there is quite negative in respect of women because the women are less likely to be easy to be found or to be easy to convince. So I perceive those things that have come about as a result of the economic downturn have really made it much harder for companies to hire women.

Q91 Baroness Wheatcroft: More optimistically, to what extent do you think the younger generation coming through now are open-minded as to whether the man or the woman has the lead role in the workload? Because we’ve talked about childcare a lot and even with the best national childcare system, one parent generally has to take the leading role in childcare, but to what extent is it becoming fluid whether it’s the father or the mother?

Kate Grussing: Well, I’m much more optimistic. The younger generation have many more role models. More women have had leading roles in universities, and their student organisations. But even at an early level, so if you look at graduate application rates, the women aren’t applying in the same rate as their male peers. They’re saying, “well I’d better get a second degree, or I’d like to do something in the voluntary sector,” or they are going into teaching and nursing. Now teaching and nursing are wonderful professions don’t get me wrong, but I’d like to see them going and becoming medics or have the potential to become executives.

Karoline Vinsrygg: I think there is a devolvement and I think that young women today in general expect more from their husbands or their partners than they did twenty, thirty years ago, and that certainly goes by – I have an eight month old baby and I certainly expect my partner to do more or less as much as I do. I think that’s quite standard too, it doesn’t always happen.

Q92 Harriett Baldwin: How important is golf these days? [Laughter]

Kate Grussing: I think it’s still important.

Karoline Vinsrygg: I’ve gone through my career without ever playing golf, but yes. You still have, you know, the boys’ clubs, there are still informal and formal networks that are hard to get into as a woman. That doesn’t change overnight either, but we are, for example, tonight having a female board dinner at Egon Zehnder so I have sixteen women on the boards in the UK and Scandinavia coming to us.

37 Executive Women in the Workplace Inquiry

Harriett Baldwin: That’s fantastic.

Karoline Vinsrygg: So we are very much looking forward to that, and yes it’s excluding men, but I feel that at times that is okay. [Laughter]

Kate Grussing: I think one of the challenges is how to get the men involved in the discussion because they are the ones who hold the keys, so we need the male Members of Parliament and House of Lords in these meetings. I’m going to an event tonight with women on boards where there are 120 people coming and 120 of them are women when actually I really wish we had some men at that meeting. Men were invited and men were welcome but they didn’t see this was relevant to them, it was only relevant to their wives or their daughters or their colleagues.

Q93 Amber Rudd: Perhaps the role that men can play that would be of some help is as shareholders, as pension fund managers who can influence, perhaps, the executive in terms of looking for better corporate governance. Do you find they play an important role? Do you find your clients are saying, “well my shareholders are pushing me a little bit harder here.”

Kate Grussing: The shareholders have been pretty quiet until recently. When I’ve asked chairmen or chief executives “do the shareholders raise this at meetings?” they would say, “less than 1% of the time.”

Karoline Vinsrygg: I think it’s coming but it’s not yet a big issue for a chairman that they feel that the shareholders are putting pressure on them and talking about diversity.

Q94 Amber Rudd: Are there areas where we could be putting pressure on them that would yield a better result?

Kate Grussing: I think that an important role for Government is to promote and encourage better reporting. So if I’m a shareholder today, I can see what a company is. Equity is in capital, in carbon footprint, and probably their total employees. Maybe they are gender split, but that wouldn’t tell me how many of the women are in executive roles or professional roles or what is the pay discrepancy or how many women left the company versus men. So that is where I think the reporting is really powerful. So obviously you are going to have different figures that are developing for a mining company or a bank or a law firm, but we need to create that same sense of awareness that I think the whole carbon footprint issue did. I think that’s where Government can play a role in terms of saying, “good companies open up their books and show where the risks and the assets are.”

Sarah Newton: That’s a good point. Well thank you very much indeed, you’ve certainly given us a lot to think about. I would have loved to have had a discussion about elder care because I do think that is a huge issue, because people stay in work also longer and all that. But that’s maybe for another inquiry, but thank you very, very much indeed for giving us your time. Now a bit of process points, we are recording this, but as I said on the way in, all our witnesses will see their evidence so you can correct it before it’s published.

38 Corrected Oral Evidence- Session 2

Charlotte Crosswell, CEO, Nasdaq OMX NLX Rebecca Salt, Group Communications Director, Balfour Beatty PLC

Sarah Newton: Do make yourselves comfortable. I apologise: Parliament is set up in this very adversarial way where it’s us and them, as though it’s going to be some sort of inquisition. Although you are described as witnesses in our inquiry, I really wish we had a big round table and this is going to be a conversation, so that is really how we want to approach this and I hope you feel, you know, really comfortable. Just let us know what you think. We will ask you some questions but if you think in the course of our discussion that there are things that you think we should hear about and that you wish you had a chance to say, just save them and if we don’t cover all of the ground that you would like to have, then of course we can always follow-up with an email or send us reports or whatever. As I said to the last people – I think you just came into our last two minutes, it’s being recorded but just to help us in terms of the writing up of the report. It’s not being broadcast or anything and we will send you drafts of the evidence so that you can read it before it’s published so that it properly represents what you say. So, perhaps, if Amber, you would like to start.

Amber Rudd: I’m Amber Rudd, Member of Parliament for Hastings and Rye and I have a background in banking and executive search.

Sarah Newton: I’m Sarah Newton, Member of Parliament for Truro & Falmouth and Deputy Chairman of the Conservative Party.

Baroness Wheatcroft: I’m Patience Wheatcroft, member of the House of Lords.

Harriett Baldwin: I’m Harriett Baldwin, Member of Parliament for West Worcestershire and formerly an MD at JP Morgan Asset Management and I’ve just come off the board of the Social Investment Business.

Rebecca Salt: I’m Rebecca Salt, head of communications for Balfour Beatty.

Charlotte Crosswell: I’m Charlotte Crosswell. I’m the CEO of NASDAQ’s new exchange NLX.

Q95 Amber Rudd: Could you possibly start by telling us how your company goes about making its appointment to senior executive roles, whether it’s a headhunter, whether you have a particular process which involves always considering gender diversity, whether that’s been newly introduced. What is the set up when you go about leading a new senior executive?

Rebecca Salt: I think in Balfour Beatty it’s traditionally the case that we have a varied succession planning programme. We’ve just announced, for example, our CEO is standing down in six weeks and his deputy is taking over so we do look to promote from within. What we’ve realised in the last few years is that from within predominately the construction business, it is nine tines out of ten a pale male. So we are now looking at changing that and certainly in the shortlist, we are going to headhunters and we are looking at having a diverse candidate pool and not just looking at gender, but also ethnicity. So we try and promote from within, but also we have to acknowledge that promoting from within we don’t necessarily have that diverse mix that we are looking for. So there is a challenge that we don’t have the perfect answer to at the minute.

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Q96 Amber Rudd: So, do you have a specifically diverse approach to recruitment at the bottom them in order to make sure that your pipeline is diverse further up?

Rebecca Salt: Yes. When we start at the graduate level, we are looking at what split of graduates are coming out of engineering degrees, for example, and trying to make sure that we are getting close to that with our graduate intake.

Q97 Amber Rudd: So, what is your policy on graduate intake in terms of diversity then?

Rebecca Salt: It is trying to – the countries in which we operate we are trying to match, thereabouts, what the graduate levels are of the particular degrees we are interested in, coming out of universities. At the moment about a quarter of our annual UK graduate intake has been female.

Amber Rudd: Which is good.

Rebecca Salt: Which is great. It’s a step in the right direction.

Amber Rudd: Excellent, thank you.

Charlotte Crosswell: Not being quite as formal, I hate to say it, the advantages of that are that there is no discrimination whatsoever, but equally there is no positive discrimination either. So we don’t have a graduate programme when we are hiring to senior executive positions. Like you, we do have a lot of internal ability so there is a pool of candidates. We go through succession planning on a very regular basis within the group and the chances are equal whether we go externally or internally depending on what that role is. To the executive vice president level, we have about half who did come from within the business. I look at our management team every week, and we are a little lacking in women in executive positions. That may be as a result of a lack of positive discrimination, but that has resulted in some moves towards increasing representation. We have now started mentoring programmes which have always been company-wide. It didn’t matter what sex you were. Now we are actually doing more to encourage women to come through and just doing more to mentor women, to get them up from the junior ranks and develop that talent.

Q98 Amber Rudd: So, if you had instructed an executive search firm to do a search and at a senior level you said you often would, would you expect them to come back with a list that was diverse, or would you just – if they came back with a longlist of twenty men, so be it?

Charlotte Crosswell: I think if they came back with a list of twenty men, I think we’d sit there and ask, “why are there no women in this pool.” So certainly, yes we’d be mindful of that and as I say, that’s because we’ve had a couple of senior women who have left recently so as a result you slightly move towards that. I mean the good thing is, in the city there is a good broad talent pool. You don’t have the challenges of structural engineering which is more challenging and I think the headhunters have got a lot better now – we were discussing this outside – it often appears I think as a lack of headhunting willingness, to put women on the longlist. It still remains a bit of a challenge. Personally as I’m setting up a new exchange, in fact I had – if anything it was the need to be aware of getting too many women, which is quite strange for me because I normally always have men working with me.

Amber Rudd: That’s interesting, there was such a good supply of women that you were in danger of-

40 Corrected Oral Evidence- Session 2

Charlotte Crosswell: Of having a lot of alpha females in the group, yes.

Q99 Amber Rudd: [Laughter] Why does that matter? Nobody seems to mind having a lot of alpha men in the group.

Charlotte Crosswell: No, but just like I would encourage diversity across views and personalities, I think if you go too heavy one way, it’s the same, it goes completely into reverse. So the first guy who came over was having quite a hard time I think with all of these very strong personalities around. So, again we did actually try to balance that out a bit more because I didn’t want to have a management team who were all women. This is something I’m a strong supporter of, the personality difference between females and males, it’s important to have that balance. If you go too strongly one way, then you find that you go into reverse. But that was by pure coincidence, we actually went out and hand-picked people who we wanted in the team and they just happened to be women that we actually wanted who had the right skill set. That was our first wave of recruitment, as we got into the second waves we just happened to get a new CTO and that was a man, and that’s not that uncommon. We just appointed a new head of business development and that was a man. I’m doing a board search at the moment. The headhunter is convinced I should have a woman on the board. I’ll just say, “it doesn’t matter, just give me a diverse list of good candidates.” I’ve been quite impressed with that change in the headhunters. I was quite encouraged by that because I’ve seen years and years of headhunters not providing good women. If anything I would say that there is a lot of women on that list now.

Amber Rudd: The supply is good.

Charlotte Crosswell: The supply is good and I think therefore they’re thinking about it. He actually said, “Charlotte we could add a woman on the board to make sure you are not the only woman.”

Q100 Harriett Baldwin: Can I just ask about the construction industry specifically because you are obviously taking steps to address what you described as a pale-male issue. But over the long-term that’s not really going to change things unless you can actually change people entering into the industry, in your particular industry. So you must be doing quite a lot, I would imagine, in terms of trying to attract more girls to think about it as a career.

Rebecca Salt: It’s really difficult. I mean, I’ve got some data on the women in construction. There are two million people who are employed in that sector in the UK and just 10% are female and that is across the piece. So, that is a pretty difficult pool because the females aren’t there.

Q101 Harriett Baldwin: Is it physically something you can only do if you’re male or do people at the executive level not tend to use the actual brick-lifting skills that you need?

Rebecca Salt: I think it comes down to the fact that for some working on a building site, on the railways tracks, it’s not that enjoyable. It’s hard work, in some cases quite dangerous and a lot of physical strength required. What has been quite interesting is that a lot of women have come in as graduates and quite enjoyed the job – they have worked their way up on the sites. The problem is that if you are on a building site on a project in London and you live near London and it’s a four year start to finish build, that’s great. But then you could be sent to Liverpool for the next project and there tends to be a bit of a culture whereby if you are a site manager or a project manager, you have to be on site most of the time because if there is an accident you have to be accountable.

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So what we’ve noticed is a real drop off in the women that we have encouraged to be out on sites and have really been successful. As soon as it comes to, “I’ve got a family,” – that’s always the drop off and it’s very difficult to then say, “okay, how do we pool our resources? If you are settled on a building project in the South East, but we don’t have any more in the South East, where do we send you? How do we find you an alternative role that allows you to have more of a life balance as well?”

Q102 Sarah Newton: Have you thought about, given that we are all going to have to work much longer, with the aging society, pensions, all the rest of it, we’re all going to be much longer. Most of us, I think that is great, lots of people are really looking forward to that. [Laughter] So you’ve got a lot longer life span now. So you’ve invested. You’ve got these engineering graduates, you invested in them, this woman has perhaps been with you fifteen years. She’s got to that point and because of the nature of it she needs to stop for a period of time, but she’ll still, if she came back, have another twenty years. So are you looking at all at that even if they top altogether how you would then refresh those skills knowing that actually you’ve got another fifteen, twenty years with that person? They’ll probably be jolly grateful to have the opportunity to come back into the career structure. How do you achieve that?

Rebecca Salt: If I’m honest it’s not something I would prioritise. I think what we’re looking at the minute is trying to change the practice on the site to prevent...

Sarah Newton: To prevent loss in the first place.

Rebecca Salt: I think so. One of the questions you have to ask is, at what point does your graduate intake start to drop out? When is it that your females decide they want to do something different? For me that becomes quite a key point, what are those trigger points for somebody’s career when they go, “I want to do something different.” I think that is going to be useful from a reporting perspective.

Q103 Sarah Newton: Charlotte, in your particular line of work is it something where people do stay a long time and is it even worth you thinking about pipelines or graduates through to twenty years or is it the sort of business where people are moving around and it’s just not worth a lot of time, trying to develop a woman from graduate, ten to fifteen years, twenty years until she’s in a senior position, potential for a senior position?

Charlotte Crosswell: That’s the challenge to the city. You know, people do tend to move around a lot. You’ll get some career people who are there for thirty years, otherwise you do see a refresh and a lot of that comes down to fact that the compensation gets readjusted on a fairly regularly basis. The only way really you can renegotiate, and it’s a very, very common thing people hear from the city. You can go in and you might want a pay rise but it won’t happen. So what happens is that people then take that experience, take the CV, and move to a different firm. I think that’s generally a concept of the city. I mean, also in the company they guarantee a bonus, they wait it out two years, they take that and then move again. You see that a lot. People are sitting there much more two, three years, or maybe five. Definitely not twenty to thirty.

Q104 Sarah Newton: So, really investing in mentoring long-term careers pipeline, while it would work for all sorts of industries that need to nurture, really in the city that’s probably never really going to happen.

42 Corrected Oral Evidence- Session 2

Charlotte Crosswell: No, and that’s, as I say, it doesn’t matter what sex you are. It’s just that is the nature of it.

Sarah Newton: The nature of the business.

Charlotte Crosswell: I think in exchanges it’s slightly different to the banks where you do tend to – I know a lot of the NASDAQ employees have been there a long time and that is mostly, again, because you will find these different roles within the exchange. I’ve done two stints at NASDAQ. One stint and then coming back for a second stint and they’ve been very, very interesting jobs. I might finish that project after two years, so you start something else up, so that you get that chance to almost start again and do something completely different. Certainly the exchange industry and vendors and technological providers, I think you tend to get a little bit more of it.

Q105 Sarah Newton: So in nurturing and developing a pipeline in that sort of environment, it would seem like it would need to be done outside, supra the individual companies, and be more like a network of people helping each outside of the organisations, but knowing that your career development would be in the city.

Charlotte Crosswell: Correct.

Sarah Newton: Whereas yours could be more corporate within the organisation itself.

Charlotte Crosswell: You know, we’re great supporters of that. As we say there is a group of women working in derivatives that actually has a mentoring programme set up. It started in Chicago, at the London Chapter, we support that a lot and we take mentors from a different firm and would take somebody from within that association and sponsor it. Yes it’s been very successful. So we are starting to see more groups like that appear which as I say, is not necessarily a corporate level.

Q106 Baroness Wheatcroft: I’d like to explore that a little further, if I may, because I saw you were at Goldman. Goldman is known for many things, but they certainly make great play of their women’s network. It was a fairly formalised organisation as far as I could see and they had somebody in charge of it with lots of mentoring and lots of events. Was it just for show?

Charlotte Crosswell: Goldman invests in its people and it invests in people that it thinks are going to go high. No doubt about it. I spent a very early stage in my financial career as my first financial job there, and sometimes I felt discrimination as a woman.

Q107 Amber Rudd: Based on?

Charlotte Crosswell: I went in as a temp for a day, a day became a week and two months and then they made me permanent. We were specifically told that some people coming through that area, so not coming through the graduate programme, they actually actively discouraged promotions. So, although I could do the job and went on to do a very good job, when I left there, it was actually suggested that, “We don’t like to promote people who have come through the system.”

Q108 Amber Rudd: That’s a snobbishness rather than gender discrimination, perhaps?

Charlotte Crosswell: Yes, it’s just strange that they actually said that.

43 Executive Women in the Workplace Inquiry

Amber Rudd: Oh I see, so that is more specific. [Laughs]

Charlotte Crosswell: Oh yes, it was pretty common. But there were probably three or four of us, girls at the desk, you know, as a senior trading assistant and the only person who ever got promoted was the guy who came in afterwards. You really noticed it. I mean, that has changed so much now, it would be unfair to sit there and put something that happened twenty years ago – I think they have got a lot better.

Q109 Baroness Wheatcroft: Has the city generally changed, do you think? Because it was undoubtedly not just at Goldman but a hostile place for women to work. I mean we’ve seen a lot of the discrimination cases that were very public. It’s quite a testosterone fuelled – but is it hostile to women still, do you think?

Charlotte Crosswell: I think it’s losing its hostility. I still don’t think it’s balanced. I mean, being there now for twenty years I don’t really think twice about it, but just occasionally you do sit there and think, “I’m the only woman in here again.” That is common. It’s very rare that I’m doing meetings where I’ll have, maybe one representative from each organisation, you know, with twenty organisations around the table. Frequently if there is one rep, very rarely that is a woman. So it’s more, it’s just taking time to come through and to be honest if you look back at why that might happen, because the time you get to the MD role which is obviously the holy grail within an organisation, the chances are you are in the mid to late thirties. Many are likely to want children. It really is difficult to sit there if you haven’t made MD before you are going to have a child, it’s incredibly hard I think to make it when you come back. So, you know, it doesn’t surprise me. I’m at MD and above, that’s very achievable.

Q110 Baroness Wheatcroft: But is it still actively hostile?

Charlotte Crosswell: No, I don’t think it is. For me, I wouldn’t even think twice about it. It still can be sexist. I do laugh, but the guys just send me off and say, “go and do your woman thing Charlotte.” I give advice to a lot of females who say, “you know, I have fantastic networking, I have great opportunities, so I don’t complain about it.” But the sexism that you come up against when you actually look at it, occasionally from day to day, you think, “actually I’m not sure I’m quite comfortable with that,” but you just put up with it.

Q111 Harriett Baldwin: Presumably once you have dealt on the building sites with the health and safety issues there also might potentially be occasionally a sexist atmosphere on a building site? [Laughter] Maybe I’m being a little bit prejudiced by saying that. [Laughter]

Rebecca Salt: I was just listening to a lot of that and sort of nodding, because in the last three roles I’ve had, I have always been the token female around the table and you sort of get used to it. I’ve done mentoring of females and some of the tales that they recant, from being on building sites, it is tough. But it’s tough for me in the office. I don’t think it’s just in one location. Across our business there are occasions where females are put in positions that are not acceptable in the workplace. I think it’s how you deal with those. I think one of the things that I feel we can be supporting the females coming up through to management level, is to give them confidence so that, if somebody makes an inappropriate comment, they’ve got the wherewithal to deal with it very calmly, move on. It’s the people – the other men round the table will then help afterwards, “that was inappropriate. He shouldn’t have said that.” But it’s actually to give the females as they

44 Corrected Oral Evidence- Session 2

are coming through, the tools and the ability and the confidence to be able to know how to handle those situations. For me that is one of the key things we need to be looking at is, how do we arm the female candidates appropriately and also how do we then address the men – and it comes back to this unconscious bias. So It’s around training and it’s also, you know, having senior guys ready to help, perhaps.

Q112 Harriett Baldwin: So are you the most senior woman in Balfour Beatty? Are you board level?

Rebecca Salt: No.

Q113 Harriett Baldwin: So you’ve got an all male-board?

Rebecca Salt: We appointed our first non-executive females last year. That was quite interesting. I was talking to the chairman ahead of coming here about that and I was saying, “well, what was the pool like?” He actually said it was not the best pool. It took a lot of time and actually the female selected is a fantastic woman but she is Canadian. But she is incredibly, incredibly experienced. She spent all of her career in General Motors and she ran places like the Middle East, Africa, South America so she has been very helpful, but we don’t have any females on the executive committee level and that to me is the feeder for the boards.

Q114 Harriett Baldwin: It sounds like below you, there is not a huge pipeline either?

Rebecca Salt: Well, I mean, we are classic in that a lot of the functional leaders are female. I’m really pleased that about three months ago we recruited our first operational female MD which is a massive thing for us because we need to get more females into the organisation at the operational level, not at the functional level because that is quite an easy one to do. It’s actually to have those role models in the operations and that is really where our focus is starting to look at.

Q115 Sarah Newton: It does seem that you do collect data, looking at the women, as you’ve said, coming in, progression through the levels. It seems like there is a real consciousness that something has got to be done.

Rebecca Salt: Yes, I think we are not perfect in our data and it’s hard but it’s something we are looking at. We have certainly set ourselves some objectives and it’s a dialogue. I mean, I think, I’ve been with the business about ten months now and I think every time I talk about it now, they’re not rolling their eyes. You know, people are listening to me and it’s starting to come from the leadership and that to me is the most important thing because I can say what I want and I can give support, but it’s “well, she would say that, wouldn’t she?” It’s about me talking to the senior leadership and actually one of the ways that I find most effective is that I have a young family and I’ll say to the deputy CEO, “well, hang on a sec. I haven’t seen my daughter awake for three days. Where would your wife be at this point?” You start to make those relationships on a personal level and then it starts to really help, but I don’t think it can just be on numbers. I think it has to be an absolute desire to make a change and change for the better.

Q116 Harriett Baldwin: Both your industries are quite cyclical. They are boom and bust, really, aren’t they? When you go through a downturn, and you are letting people go, do you also measure in terms of those redundancies, what the proportion is and whether it’s disproportionately one gender or another?

45 Executive Women in the Workplace Inquiry

Rebecca Salt: We don’t measure that but we wouldn’t – the way we’ve done it is the best person for job. Certainly we wouldn’t be retaining females on gender grounds.

Q117 Harriett Baldwin: But once you’ve gone through that process, would you then go back and say, “is this outcome we would have expected? We seem to have lost our entire pipeline of women?”

Rebecca Salt: I wouldn’t – we’re going through a redundancy process in the UK at the moment. I’m just trying to think. We’re still at that point where we wouldn’t quite have that information to look at. But I suspect, knowing the person in charge of HR in the organisation, she would.

Charlotte Crosswell: Yes, we certainly wouldn’t. I think it’s something we are very conscious of being above 20% of women, which is better.

Amber Rudd: Same as Members of Parliament [Laughs].

Charlotte Crosswell: You know, it’s a tough job. There is no doubt about it. When you’re being an officer of the company, you are coming with the business ownership. You know, you are working very hard. So it is challenging. After that, it really drops off, but you know, I think you would have to be very conscious to sit there and to watch that and monitor that. But it’s interesting that it’s very much the best person for the job. It’s who wins on personality.

Rebecca Salt: I think as a woman in business, I would only want to be there on merit, because I certainly wouldn’t want to be given the role because I was the female. I would want to be given the role because I could deliver the results and I think that is something that is pretty – I mean, I certainly think we should keep in our mind the potential of the women around.

Q118 Baroness Wheatcroft: But if the Government took the view that it was for the country’s good to have more women in executive positions, is there anything that you believe could be done to enhance that?

Charlotte Crosswell: Certainly I think, coming back to the mentoring. I’m quite happy talking to a male counterpart, but there is no one else. So finding someone to talk to I think is incredibly hard. I’m very much in favour of it and when I did find, the personality differences. I think women do like to have someone else to talk to. I set up informal groups of women in the city where I just invite people round, you’d just get out for drinks, you’d just go out for dinner. I just find the dynamics are fascinating. When you only have women at those events then you will have a completely different conversation, where people are quite open with their concerns, they might talk about sexism, they might talk about something else. You have one man come to that event and the whole conversation changes. So I think you do need to sit there and surround them with women so they can sit there and go, “God do you think this is – I am out of order, or how do I tackle this?” But people are very nervous, despite the high profile cases we have seen, generally most women are very, very nervous to complain about any type of sexism.

Q119 Baroness Wheatcroft: I think you are absolutely right what you say about the dynamics being different, because I’ve always been pretty hostile to the idea of a women-only event, but I did go to a conference, Rothschild-organised, for women from business around the world. It was fascinating that people were just very open and honest and it was quite different to any conference I’d ever been to before. Absolutely different dynamic.

46 Corrected Oral Evidence- Session 2

Charlotte Crosswell: Yes, I did a speech recently for Management Today, and this again, the conference was only for women. In fact the only men who were working there were the ones doing the mike and the technology which was quite interesting. There was so much interrupting on the panel of people sitting there, asking questions, putting their hands up, wanting to get into the day to day. You would never see that and I think they just felt, “well, I’ve got my peer group here.” These were women from all different industries, all different seniority levels from junior assistants up to management. I was probably like you, sitting there having shied away from them not wanting to be seen as the token feminist and if anything you sit there and I do try to spend a little bit of time now, because I do think you have to spend time doing that otherwise there are no other women to talk to. It’s the only way, really, that you are going to help someone through their career path, because it’s tough. There is no doubt about it. It’s been a tough two years and I’m not sure many, many women have the resolve and confidence and are thick skinned enough to sit there and really cope with it.

Q120 Baroness Wheatcroft: So, encouraging networks of one sort or another is really important?

Charlotte Crosswell: I think it is and just having another woman or two women just to go and talk to, whether it will be within the company or outside the company, you are coaching them. The coaching is the new thing now and everyone in the city has started to get into coaching. Personally I’m not a huge fan of it. I can see the benefits of it, to sit there and give someone in a room, where they don’t get worried about what they say – women get very worried about perceiving weaknesses. They don’t want to be shown as being weak in front of the men. So you have to sit there and you have to talk about football.

Q121 Harriett Baldwin: Charlotte, now you are CEO level, do you find that a lot of research firms are calling you up about possible non-exec roles on other boards?

Charlotte Crosswell: No. It’s quite incredible. The last board position I looked at and was interviewed for it went to a man. They’d said to me – I was put in as the wild card. “You have got to put a young woman in.” I was sitting there going, “really? What was the point? You obviously had no intention of looking outside your normal dynamics.”

Q122 Harriett Baldwin: So, you are up for the roles, they occasionally approach you, but you’re not –

Charlotte Crosswell: It’s very, very occasional.

Q123 Amber Rudd: It’s an interesting conflict, what we’re hearing from you. You know, early on in this conversation you said how there was a good supply of women. You had to be careful not to appoint too many and yet culturally it’s a terrific break. So the supply is there, but the demand isn’t there?

Charlotte Crosswell: Yes, NASDAQ has agreed that I can do a non-exec position so I’ve had it cleared despite, you know, I’ve got a clear conflict which is challenging but it’s just yes – it’s amazing. You still don’t really get the calls. That pool is pretty small. So I’m on a board search at the moment and I’ve been very impressed by them just sitting there and just throwing names out all over the place. Clearly having a very big pool there of some very talented women as well as men. So I think that is shifting.

47 Executive Women in the Workplace Inquiry

Q124 Amber Rudd: So do you think that the Davies report that we were discussing with the previous headhunters has had much influence in terms of moving that thought process on?

Charlotte Crosswell: A little bit. Not as much as I’d like. It has in the FTSE 100 companies because Mr Cameron keeps sending them letters. But I just, you go down to FTSE 250 and I know quite a few of those companies.

Amber Rudd: Me too, and some of them like the mining companies have said, “it’s ridiculous to ask us to have a woman on the board!”

Q125 Harriett Baldwin: Did you get good feedback on why they chose this man?

Charlotte Crosswell: I was probably quite high-risk and he’d done it before and that’s it.

Harriett Baldwin: So it’s the first one, it’s the first one, yes.

Charlotte Crosswell: Everyone says the same. I’ve actually gone up to other women and said, “what would you advise?” They said, “To be honest you probably have to give up your executive position.” There is also this – they feel that the woman in an executive position may be too strong, maybe won’t have the time, with their childcare. There is always this unconscious bias. I’m sure if you gave it up you’d probably have twenty calls. A huge concern over if you are in the city and if you’ve succeeded to that point, what sort of woman are you? But I think you are labelled, if you go to a senior position in the city, then you unfortunately are not going to be the most approachable for anything else. So if you leave that culture, I don’t know.

Rebecca Salt: But a male executive probably would be able to do that in an executive position. I think that’s the point.

Charlotte Crosswell: I’m sure it’s that question of how much time you have really got to do it.

Sarah Newton: Also the very qualities that you are being criticised for, from what you’re saying, would be lauded in a man, you know, strong, gutsy. They would be thought of as been absolutely marvellous but if you are a woman to behave like that somehow it’s some sort of problem.

Charlotte Crosswell: Men are very scared of seeing that in a woman.

Q126 Harriett Baldwin: This board that you were interviewed for, was it one where they have any other women on the board?

Charlotte Crosswell: No, they didn’t. I think it’s just that the first position is hard and again, coming back to the research that I’m doing at the moment, as yet I haven’t got a single woman in the executive position who has been put on the list. That’s different from men.

Q127 Sarah Newton: I think you were hoping to say something there?

Rebecca Salt: I think I just wanted to catch up in terms of, I think for me, whilst the Davies report has actually made companies like mine – you have to address this appropriately. For me it now

48 Corrected Oral Evidence- Session 2

needs to look at what it can do about executive level because –we have one female on our board and she’s been there, you know, about ten months now. The board have actually, it’s been great having her there, what she is bringing is fantastic, but for her it would be much more supportive to have another female. But I also then think, where are these people going to come to in future, if the exec committee level is not being asked to replicate the board, then where do the females come through from?

Q128 Sarah Newton: Well this is why we have undertaken this inquiry, because, yes, the whole focus is about non-executives on boards and, yes, there has been lots of work done on that. Our inquiry is about the pipeline of encouraging women executives all the way through to the top to say that they can be on the boards, absolutely right. That’s really our focus here today.

Rebecca Salt: I think Davies has really helped achieve the focus that we’ve required at that level. It will be very interesting to see how that is working in the rest of the organisations.

Q129 Baroness Wheatcroft: Do you think it’s important to actually start by getting the message across to schools?

Rebecca Salt: Yes. If you look at teenage girls, on the news at night when there is a business person interviewed, how many times is it a female? Very rarely. If there is a female CEO, and Mary and I have shared recent examples of this, when I read back the interviews from some of our national broadsheets in terms of how her full year results are presented, it is a completely different tone and question to how a male CEO would be represented. So it’s at all levels of society and for the media to be role modelled. For me, for young girls, what are their role models? There is the classic model, you know, the model, the TV star and the singer, although they go into the vets and the lawyers which is absolutely admirable. But where are the business role models that say to them, where do I go? Now, I’ve got two nieces who are fifteen and sixteen and they just don’t know the concept of what I do for a job, and what the options are and what the opportunities are. That to me is where it has to start. We all have to get back to our roots again. “This was the comprehensive school that I was in, how can I help show you some other options?” Because I certainly wasn’t.

Q130 Harriett Baldwin: So, how did you get to where you are then?

Rebecca Salt: I had finished A Levels. I had absolutely no idea what I wanted to. I had horses and I ride so I went to California to ride horses for a year and while I was there I met a guy who had a PR agency in Los Angeles which seemed to me the most sexy, exciting thing ever and somehow from there, I’m now doing comms for a multinational building company. But he got me into the media and advertising, but I don’t know how I would have got there without seeing that.

Q131 Harriett Baldwin: Because you didn’t get the career advice at school?

Rebecca Salt: No, I think my last career piece was just, “I’d be a good librarian!” [Laughter].

Q132 Sarah Newton: You have really touched on something that we discussed with the ladies who were here before and that’s the role of media. I do feel this is really important, about what a huge responsibility they’ve got about projecting women. That’s very interesting, the specific point that you made, even something as simple as talking about a company’s annual reports, you would see a difference in the reporting between a female and a male CEO because the media itself has

49 Executive Women in the Workplace Inquiry

got a problem, because there are so few women in senior positions in the media. So, do you think that is something we should be exploring, perhaps? We haven’t thought about this in our inquiry, is inviting more female business and leading people from the media to talk about whether they aware of these issues and whether they themselves are trying to tackle that?

Rebecca Salt: There was an absolutely classic Daily Mail article and I actually sent it to Mary after I’d met her because I was outraged by it. It was the female CEO of one of the tobacco companies. But the way she had reported, by this journalist it was literally at the end of it he said, “I felt like my pants were down and I was spanked by a school mum.” [Gasps] Some editor, a serious editor allowed this to be published in the business pages reporting on full-year results. If that had happened to my CEO I would ask for it to be taken off the website: why is that being tolerated? You wouldn’t report on personal things like that. It was very, very personal about the family and the children and do they smoke? This is unacceptable.

Q133 Sarah Newton: Yes, because that is why so many women, I think, do quit because society says some way somehow that women who want to have children or have a career, some how the children are going to pay the price.

Amber Rudd: They do always seem to report when they report on senior business women, about whether they have families or not.

Charlotte Crosswell: I specifically asked for it not to be reported. I was featured in the FT when I moved roles and I said to him, when they interviewed me for it, “Fine, my daughter goes nowhere near this.” She was very, very young at the time, she was nine weeks old and for security I didn’t want her in there and they put it in. I had a huge argument and they wouldn’t take it out. I just sat there and I said, “well I specifically said that that was not to go in. It’s irrelevant.” Then you get this whole load of prejudice as well. Whereas now, in fact, I’d probably feel a lot more confident now to sit there and say, “I’ve got a four year old and I do this, and I juggle everything.” I think you get the confidence as you get older to sit there, but you are that age, and actually people sit there...

Baroness Wheatcroft: The media judges women differently, particularly the business pages, if you look at the Daily Telegraph business section and the Sunday papers, the way they have managed to find a photograph of a woman on the front is extraordinary. The somersaults they go through for scantily clad women –

Sarah Newton: Can we ask you about – we’ve only got a few minutes left actually so it will be the last couple of questions.

Q134 Amber Rudd: I just wanted to ask about investors, whether you feel that there is pressure from your shareholders to try and employ more women to make sure there is a supply of women to get more women on the board. Do you feel that is having any influence at all in terms of corporate governance?

Charlotte Crosswell: It’s certainly starting. There is no doubt about it. In terms of, I think that’s an impact of the Davies report. I think it’s actually less in the US. I think that we do have good representation of women on the board, but I think the Davies report has certainly changed that and investors now proactively ask for that. So I would say if anything investors have bought into that more than anybody. Apparently they are asking a lot of CEOs about, if they haven’t brought women on board, why haven’t they.

50 Corrected Oral Evidence- Session 2

Amber Rudd: That’s encouraging.

Rebecca Salt: I agree with that. We certainly were being asked the question about diversity. But, then they stopped asking, because we’ve ticked that box.

Amber Rudd: Because you’ve got the one.

Rebecca Salt: Because we’ve done what we’ve been asked. I think now, it’s like, well we don’t need to ask that question, tick the box, we can move on. But actually that is not the answer.

Q135 Sarah Newton: So what should we be doing as MPs to address this issue, do you think?

Charlotte Crosswell: Childcare costs. It’s the main issue for women coming back to work. If you want a responsible job, I have a full time career and I’m a single parent and the costs are crippling.

Q136 Harriett Baldwin: It’s an additional mortgage, isn’t it?

Charlotte Crosswell: Yes, childcare vouchers, they’ve gone down from the earlier level. It doesn’t even pay half a week’s salary.

Harriett Baldwin: It’s £924.

Rebecca Salt: I think I can get £670.

Charlotte Crosswell: So if you have to take that out of your gross salary, it’s a huge difference, but for a full-time nanny now, live-in is cheaper, it’s £80,000 of your gross salary. So, you will be paying £40,000 so it’s £80,000 and at the end of the day if you want a really responsible job to sit there and go to nurseries or au pairs, you don’t want to leave them. Why should you?

Q137 Harriett Baldwin: I think I’m right in saying it’s the only area of life where you can employ someone full-time and not get any tax break for it, isn’t it? Can anyone think of any other area of life where you have to pay out after tax?

Charlotte Crosswell: But it’s incredibly expensive and I think if you really want women in those positions where you can be called on. I’m pretty strict, at 7.30 I don’t take calls and that’s it. But it’s just incredibly difficult to juggle. You are juggling everything and you’ve got this huge cost and I think that’s where you learn, and I don’t know how much you look to the Nordic experience but NASDAQ owns a lot of Nordic exchanges so it’s completely different and very cheap childcare costs. There is an awful lot of flexible working. It’s inherent. So they are so used to it and nobody even thinks about it. You know, I talk to the guys who are off at four to collect the children from school and the wife will work and the woman will work.

Q138 Amber Rudd: So, it’s not just the cheap childcare, it’s the culture of the man also looking after them?

Charlotte Crosswell: Yes, it is but I think the first step ought to be finding a better way of childcare and the UK is very specific –

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Q139 Amber Rudd: Is that led – people might say, “well at your level, you are probably on a very big salary,” but it’s getting the pipeline lower down before you get to your level to keep them in.

Charlotte Crosswell: Yes, absolutely.

Rebecca Salt: Because I mean, for me, if I look at what I pay in full-time childcare and on my salary it’s not great but you can do it. So, how is somebody of lower level?

Q140 Amber Rudd: How are they going to sustain it?

Rebecca Salt: What I’m seeing is they’ll have their first child, they’ll come back to work and find it crippling. They’ll find it really hard. They’ll have their second child and say, “it’s just not worth it.” They’ll probably do it for six months. One example, I used to previously work for DHL which is based – Deutsche Post – in Germany and they are really making an effort to keep working women. What they have done which I think is fantastic is they aren’t giving women with children pay rises, but what they are doing is paying their childcare costs. The women they’ve targeted as high potential, their childcare costs will be paid for by the business. A friend of mine has got two children. She is saying, “I haven’t had a pay rise for four years, but do you know what? I can’t go anywhere else.” The company gets the tax break.

Amber Rudd: Is that right?

Harriett Baldwin: Well of course it would, if you employ someone you would get a tax break, there will be tax deductibles.

Q141 Amber Rudd: Which company is doing that?

Rebecca Salt: This is DHL, Deutsche Post in Germany. So what she said to me is actually, “I like the job. I’m very happy but I cannot financially afford to move because I’d not get this deal anywhere else.” I’ve not had a pay rise but that doesn’t matter because what I’d pay in childcare is so much higher.

Q142 Baroness Wheatcroft: Would it pay the childcare costs for men?

Rebecca Salt: I could find out whether they are or not.

Baroness Wheatcroft: You are saying it’s targeted. So it’s not available to everybody. You are saying that these are the people.

Amber Rudd: But you wouldn’t want to, because the whole point is to keep women in the workforce.

Baroness Wheatcroft: Well I think you’d run into all sorts of problems.

Rebecca Salt: With German legislation, it’s a business. It’s your percentage of female employees having a taxable benefit and I think that’s why they –

52 Corrected Oral Evidence- Session 2

Q143 Sarah Newton: But then the Government might have set them targets, you know that we ought to recognise. So the Germans have done that, we’ve heard a lot about Norway, so we ought to see about what Germany is doing.

Charlotte Crosswell: I mean, but even Sweden. Sweden is interesting because they don’t do the quotas. In Sweden, the only problem is I had 70% of my team out at one point because the men take the parental leave as well as the women. It’s eighteen months per couple and you can it up to the age of the fifth birthday and you can take it in chunks. It’s an absolute nightmare, but, you know, it just shows when they all come back into work then there is no discrimination whatsoever and all women work. They all work. You are not perhaps taking the time off at the same time, but what they do is they then take the time off for the second child at the same time as the first child. So, it’s not ideal but what I’ve seen is the end result being that there is no discrimination, a lot of women work, a lot of women work in senior positions. It’s very normal for a guy to leave at four o’clock and pick them up from childcare and that is what you do. The problem I always have with nurseries rather than having a nanny is you’ve got to leave the office. You’ve got to get home and you’ve got to get there by six so if you’ve got someone where you can split that between the man and the woman it’s very easy. If you are doing it where it’s always the woman then it’s incredibly hard. But over there everyone puts them into nurseries because the men might need them.

Q144 Sarah Newton: Our last witness is probably outside, so any other points?

Rebecca Salt: The other point I think is around our maternity policy in that as a female you feel very, “oh I can take time off work,” but you aren’t obligated to come back to your employer and say, “I don’t want to come back.” It’s all very tricky around paying that money back if after you have had a baby you change your mind. I wonder if you could look at this and make it much more flexible. I just had a case of somebody who had taken six months’ maternity leave. Three weeks before she came back she said to me, “do you know what? I don’t want to come back anymore but this is what I’d like to do.” If she felt confident to have that conversation with me three months in, I could have planned my team better, we could have worked it through, she wouldn’t have been so uncertain about how much she would be asked to pay back etc. and we could have reached a solution that worked for her and the team.

Amber Rudd: That’s what is so awful.

Rebecca Salt: I know you don’t know but we always get this “us and them” employer and employee game with maternity leave. Whereas I would much be able to have, “this is how I’m feeling, how could we make this work?” I think if you were more able to be more open with a three month old child, then you’d go actually, “no, I can’t do this.” It’s a very different situation when the child is five months, but I just feel that we make it so “us and them”, that relationship should be more positive.

Sarah Newton: But you’re right for looking at the comparatives but thank you ever so much, that is a lot – I really appreciate your candour, thank you very, very much.

53 Executive Women in the Workplace Inquiry

Jill May, former MD, UBS

Sarah Newton: Jill, I’m Sarah Newton, this is Patience Wheatcroft and Amber Rudd. So, please come and sit down. I really apologise for this adversarial set up that you always have in parliament. What we’d much rather have is a big round table because we really just want to have a conversation with you. So if you can overcome the physical environment and imagine that we’re sitting around the table that would be great. First of all, thank you so much for coming and giving us your time. What we are really interested in here is how we can keep more women in the workplace, so that they can progress right through to senior executive positions. A lot of work and government focus has been women on boards. What we are really interested in here in our inquiry is nurturing this pipeline, keeping people going so that eventually you’ve got more women in senior positions and then that will throw to women on boards. So that is really the thrust of why we are here. We’ve really got thirty minutes with you. So, perhaps if Amber wants to kick off.

Q145 Amber Rudd: Hi, I’m the MP for Hastings & Rye and we spoke many years ago when I was writing about this subject. I was formerly a headhunter and before that at JP Morgan. You were at UBS and you left recently?

Jill May: Yes.

Q146 Amber Rudd: How did UBS, for instance, go about appointing executive staff and did they, before you left were you aware of a move to get more women into executive roles?

Jill May: By executive staff do you mean senior executives and senior officers or do you mean from graduates upwards?

Amber Rudd: I meant more senior, really.

Jill May: Because we didn’t do a huge amount of hiring outside, laterally, and it tended to be home-grown. I think we have to look at it as the complete movement. Had they latterly moved? Had they become aware of their extraordinary deficiency of women pretty much in all ranks but especially in the senior roles? Yes. Had they done much to really address it other than do a few kind of women focus groups and coaching and things? No. That, I think, reflected in part the fact that just as they were beginning to think this was something they had to address, crisis after crisis befell them and they were concentrating, really, on surviving. That was from CEO downwards and therefore everything of any substance designed to help women back into senior positions or help them progress became rhetoric rather than reality.

Q147 Amber Rudd: Because at the graduate recruitment level, my experience was that actually most of the banks were pretty fair that there tended to be quite a lot of women recruited at graduate level. It was just, age as we were hearing earlier from earlier witnesses, in their thirties were a lot of women who dropped out. Were they taking any action to try and deal with that in terms of, “are we conscious that not enough women are getting to the top?”

Jill May: Well, the answer is, it’s a multiple answer really. At UBS we didn’t recruit enough women. We only had a 35% recruitment rate which wasn’t enough because you’ve got to start off with at least 50, given what we know. There is no reason why you shouldn’t have at least 50 because at least 50% of the smart people coming out with the best university degrees are women.

54 Corrected Oral Evidence- Session 2

Q148 Amber Rudd: Are they applying then? Are 50% applying then?

Jill May: I think probably either they were applying and we weren’t selecting them for some reason, because they didn’t exhibit the right behaviours that they thought were valuable, or maybe they weren’t applying. There could have been reputational issues which might have prevented them from applying, but we didn’t start off with enough. Were we doing anything proactive about it, except within pockets of HR and diversity? No. Largely because most people didn’t think there was a problem. Because your average man on the street thinks that he’s running a meritocracy and if his team is performing, “what’s the problem? What’s wrong? Yes, women go off and have babies, big deal. Somebody else will fill their place.” So therefore people weren’t focussed on the commercial merits which I’ve always argued as the only way you can make people change and make people think that it’s a business issue. They weren’t focussed on the commercial merits and through the relentless focus quite rightly of the press and elsewhere, HR obviously are a bit concerned about it, although even that without necessarily the focus and through concerted personal effort, I did try and persuade my senior colleagues that this was a commercial issue. I think singly and individually I succeeded, but in order then to cascade that down in a huge organisation requires a very major leadership effort. I think we were on the cusp once or twice of getting there and then the guy would be fired or something, somebody else would come in. So we never really got there. I think I had a few believers, but we just didn’t have the opportunity and the consistency of senior management to see it through. I think that you could educate people that they could see that this was a terrible waste that we were educating talented people and then losing them without apparently doing very much about it. But it has never been presented like that, so the commercial aspects of diversity within UBS were not really explored.

Amber Rudd: Okay, thank you very much.

Q149 Baroness Wheatcroft: But do you think that UBS was just in step with the rest of the city?

Jill May: I felt that it was terrible. I mean, I’m a critic. I naturally think that things can always be done better and therefore I felt that we did things particularly poorly, but actually I think that other firms probably had a better PR effort at appearing to do more diverse things. Frankly a lot of these diversity initiatives are not really worth a lot unless they are in the context of a much more holistic programme. I felt we did very badly. When I then listened to Goldman Sachs doing the 10,000 women programme, quite a lot of it was window dressing. It’s high-impact for clients and for students joining from university. They are eye-catching things and you think, “Goldman, fantastic!” Whether, at core, the cultures are very different, I can’t really comment, but I’m not sure that we were really significantly the worst.

Q150 Baroness Wheatcroft: You mentioned clients. Do you think that clients had a view at all about whether they should or could be dealing with women, because on the whole the clients were men?

Jill May: I think, slowly, the answer is, “yes,” not least and I’m not a public sector person, but not least things like the Equality Bill mean that people are conscious of, you know – they are more conscious of the fact that they should be confronted with diverse teams. As a client if I was a female client and there aren’t very many of them – that’s part of the problem – it is actually the position in financial services has mirrored the senior executive positions in, kind of, corporate UK. But it’s beginning to come. In the wealth management business too – as you know, 50% or 60% of the UK’s wealth is held by women. So, actually logically in a wealth management business

55 Executive Women in the Workplace Inquiry

which is the biggest part of our business, we should be targeting wealthy divorcees, entrepreneurs, Russians, you know, whatever. But a lot of women, and I would have thought it would be strange if I was being pitched to crudely as a woman, as a decision taker, not ever seeing somebody who looked like me. Or who might empathise, you know, think like me.

Q151 Baroness Wheatcroft: But you got to a very senior position at that organisation. How did you do it? What were the obstacles?

Jill May: I had a lot of luck. I wasn’t as senior as all that. I was a managing director, of which there were quite a few. I would say I was very lucky. I had good sponsors. I’m a strong character. I made quite a lot of noise, so to sort of – if I felt I was not being dealt with fairly, I had the natural instinct to risk being fired and to make a noise. That doesn’t necessarily come easily to a lot of women. So, I think I had a few things going for me but I was undoubtedly lucky. I might add, I didn’t rule the world there and that was partly because I probably wasn’t capable, but partly because it was conscious choice that I’ve got a big family and I wanted to have a balance. If I had swept aside the family, I would probably have had a better chance but there were plenty of women there who had swept aside the family or didn’t have them and who still didn’t get to where they felt they rightly should have been.

Q152 Baroness Wheatcroft: Were they right?

Jill May: I think so because I think the problem is, you know, there is a lot made of the different ways that women behave and think and things, but that really isn’t an excuse. I mean, if we get an efficient environment, we should be able to not just have it as the male set and the women have to adapt. I mean, there should be different ways of working so that smart women, albeit if they have slightly different stylistic approaches should still be able to prosper. I think so, because I think the reality is, in something that is so heavily male dominated, unconsciously, you know, if the guy has got a team of ten and one is a woman he is more likely, when he comes to filling that unforeseen gap in his staff, or promoting, he is more likely probably to promote Fred, because Fred is a good sound guy. “I’ve known him for ages.” He looks a bit like him feels a bit like him, whereas Jill, “Jill has done bloody well. She is incredibly aggressive, but it would be a hell of a risk putting her in that job.” That’s just the sort of mindset. It’s a risk putting a woman in. It’s particularly a risk taking a woman and putting her in a different discipline. So there is not a lot of mobility around women and they tend to, because they do – lots of them do choose to have families, they come back and they tend to be automatically popped into a safe, slightly less edgy area. So that is why the all migrate to HR and legal and all the rest of it. I think it’s done with the best will in the world. It’s designed to be a cosier environment but it means you are out of the mainstream. You are never going to be taken seriously, even if you are head of HR. So, it’s a bit random, sorry.

Q153 Mary Macleod: I’d like to apologise Jill for being late. I was fighting on behalf of women in the chamber for succession rights to the Crown! So if you’ve covered this, please, we’ll just move on, but how positive, given what you’ve just said, how positive are you, especially with a city background, for the future? Do you really think that we are going to change things dramatically and is the Government doing it enough or should it do more? So, are the things we are doing on flexible leave, shared parental rights and also on the Lord Davies work, the Lord Davies commission, are these things going to help? Because what sometimes worries me is that in organisations you have, and I’m not saying the Goldman Sachs version is a tick box, but people do those lovely interventions thinking that it sounds good, but actually do we get the results at the end and does it make a difference?

56 Corrected Oral Evidence- Session 2

Jill May: God, do you know? The answer is, I don’t necessarily think that more interventions and more – and I’m being totally honest, more maternity rights and all the rest of it aren’t necessarily helpful at all because I think, you know, a big bank might be able to manage countless iterations of maternity and paternity and all the rest of it. But we’re also looking at middle sized organisations and I have a family business and I know that enhancing maternity rights and things is just a way for, just to say, “we just cannot afford to employ women.” You’ve heard female headhunters and things, I mean people who employ a lot of women, it can be for small businesses, I think, just impossibly burdensome. So I’m not sure that that is helpful from my perspective. I mean, I firmly believe the Lord Davies thing has got real traction on the NED thing. I mean, he really has put it on the agenda. So there must be a way we can leverage off that success. I know you’ve got the 30% club now all moving into it, but it’s far tougher to crack this executive pipeline or whatever you want to call it than it is the NED thing. The NED thing really can be supported without legislation, I think, probably, but you’ve got a head of steam with Lord Davies and you’ve got chairmen who appear to be buying in their droves into this concept that it’s valuable to have diversity at board level. It’s very easy to jump into, “it’s important to have diversity at decision making throughout an organisation.” So there must be more we can do that. But I do think it’s a determined drive to educate, not just chairman, but fundamentally it’s the top executive team that, you know, is important performance wise. In the eyes of their customers and in the eyes of their employees – if they don’t get a better balance within their businesses, if those businesses lend themselves to women – I mean, I’m sure some construction businesses, you are never going to get enough women in hard hats. It’s just not something that necessarily plays to what they want to do and plays to their skills so it is not horses for courses, it depends a little bit. But I think if we can better educate senior executives using Lord Davies and others that this is a commercial benefit for their business and the UK and we are wasting resources at the moment and it’s less about doing the right thing than about doing the economic thing, then I feel that that’s the right way to go.

Q154 Sarah Newton: Building on that, because some of the evidence we’ve heard is how government could help to support that, to persuade businesses that it’s in their own interest. Just like they are asked to report on other things like, you know, the decarbonisation or whatever, because it’s perceived to be in their business interest, whether the Government could ask companies to report on numbers at different levels within the organisation.

Jill May: I completely agree with you. I think reporting transparency is the best tool we have.

Sarah Newton: Okay that is really interesting.

Jill May: Because I’ll draw an analogy with the whole environmental transparency that is now, you know, all major companies now report on their environmental footprint or carbon usage of X, Y and Z. That wasn’t the case ten years ago. I don’t think there was any environmental reporting and yet now it’s totally transparent and anybody who is remotely concerned can look at UBS, can look at Sainsbury’s, they can look at anything and they can compare. I know it’s not easy comparing across companies but you’ve got a pretty clear set of metrics against which you can judge whether a company is behaving sustainably and admirably and effectively or however you want to say it. Now I think that actually transparent gender reporting, and it’s difficult, is a really, really good way to do it. I was about to mention it and I went off on a train. Because then my daughter, about to leave university wouldn’t just get the bullshit, but could actually see whether it actually translated into – you could do it by age bracket, you could do it by management tier, you could do it by division but it couldn’t altogether be an entirely artificial construct.

57 Executive Women in the Workplace Inquiry

Amber Rudd: Like popping some NEDs on top.

Jill May: Yes, I mean you’d have to – and that I think would be good for employee visibility, good for customers, investors. You know, the investor thing I think is the important thing to explore as well. I don’t think it’s really got traction yet but it might over time. You know, people are becoming far more focussed on the environmental impact of the companies they invest in and is it sustainable? I think one could start promoting the idea of, is there a proper – I don’t think you can be too prescriptive, but is there a sensible gender balance and if there is only 10% of women, then explain. You know, say why you can’t have more women in hard hats or whatever. So I think there would have to be a narrative in the context of the metric reporting, but I think that that is the single best way of promoting it.

Q155 Baroness Wheatcroft: I’d query whether it would actually influence investors. I think they are pretty narrow in their range of interest, but if I could, I’d like to take you back to something that you mentioned earlier, you said you had a couple of good supporters, sponsors, was the word you used. How important do you think that is and should it be formalised more? Could it be?

Jill May: We subsequently, in my last year of UBS, the HR lady decided that every woman should have a sponsor and I argued with her of the logic of this, because sponsors aren’t, you know, created. You can’t say, “Jill, your sponsor is Fred.” I mean Fred doesn’t know me from Adam and there is no way he is going to sponsor me. Sponsorship is something that just comes over a period of mutually working together, mutually, probably liking each other. Fred is thinking that actually I’m reliable and can be depended on, so it’s a relationship that grows. So I think that sponsors for all I always held was nonsense. Mentors for all is an entirely different proposition. Sponsors, I think people should be focussed on – at any one time, and I think when you are doing well in your career you are not necessarily focussed on it and if you are you’re young, you are probably not either. But the reality is, particularly now, me, at 51 trying to carve a new career, the people who have worked with me over time are prepared to be my referees and prepared to put in a good word are critically important. They are also critically important, actually, although you don’t realise it, when you are at a junction within an organisation. So, yes, but I mean, that as I say isn’t something that can be replicated in a hurry. It’s more people being aware of the need to foster and build those relationships and it doesn’t come as naturally to women I don’t think.

Q156 Amber Rudd: May I ask, I mean, you might be an example of somebody who has stepped out of the executive pipeline before going to even greater heights. Was there anything in particular that made you do that? Got in your way?

Jill May: Just exasperation with UBS really. Not even, at times the company. Just the sense of a ticking clock and was I going to be stuck here forever doing what I was doing or was I going to test myself which was high-risk, but at least I’d hit 50 and thought, “It’s time to do something different.”

Q157 Amber Rudd: Our last witnesses focussed very much on childcare, costs of childcare, in fact one of the reasons why the pipeline thinned out was in fact, not just the obvious, “I want to be with my babies.” But it was like, “I can’t afford the full-time childcare that goes with being a serious executive.” Do you think that’s –

58 Corrected Oral Evidence- Session 2

Jill May: Well I think that banking is such an overpaid industry that it’s less of an issue because most people, you know, even at the age of thirty, if they are doing well within the organisation, could afford childcare. I think, now actually my children are growing up, but I’ve still got a nine year old who I’ve got to collect! But most of my children are sort of growing up so I don’t have the same issue, but now at my juncture, looking now, “can I afford to go and be a non-exec?” But actually childcare would be an issue, because unless you are taking home a salary of a couple of hundred thousand pounds a year, I think it’s a hell of an issue, but again, not an easy one to fix.

Q158 Mary Macleod: Can I just ask, those skills, because our witnesses spoke quite a lot about skills, but there were very specific sectors and so they talked about, for example, maths and engineering of youngsters coming in. In financial services of course, that is less of an issue because obviously most people will have maths or will have good degrees anyway, but it did question with me the issue that some people raised, which was about, are there skills that women don’t have that are getting them further up? It’s skills or experience, some people said that the FSA are quite rigid about the roles for who is allowed on the board. That is probably on the non-executive front rather than the executive. So are there – do you think there is anything that is missing?

Jill May: I think it’s again just this diversity of approach. I don’t even know whether sex stereotyping is really valid. It’s easy to say, I don’t know, whether more women don’t ask for things. I suspect they don’t. I think my experience of women is that they just tend to do a good job and imagine that that’s going to be enough. They are not as political and they get more upset when they are not given the opportunities and we’ve just got to, certainly within the banking industry be much more robust and much more, really, aggressive sometimes, certainly when it comes to the annual pay and rations and whatever you are called. You have got to stand up for yourself better. I think that is something which many of my colleagues didn’t enjoy doing. It didn’t come naturally.

Q159 Baroness Wheatcroft: So could we encourage women to be more proactive in building their career?

Jill May: Yes, but it’s, I think it needs more work if we have to work on a one-size fits all, basis. So if we all have to become the same, like a man, to succeed then there is more work to be done there.

Q160 Baroness Wheatcroft: Do you think that networks within organisations, UBS and networks within industries, can be helpful in that way?

Jill May: They can be helpful, yes. I mean, I would like to think that what we created at UBS was motivational for women. I would not begin to say that it would really move the needle in terms of whether you made more women managing directors. I think, you know, I realised early on that if I judged the success of the thing by the real hard-core dynamics, you’d probably give up tomorrow. But I think my message was just to provide women with lots of motivational content, if you like, be it, you know, exposure to women who had done different things, who had taken mid career breaks and come back, who did think differently about the world, who had climbed Everest. To make people slightly more aware of, A, the joy of life and B, what they were probably capable of achieving. That’s a wishy-washy answer, but that is really what I try to do.

Q161 Mary Macleod: So is it more about role models and trying to get –

59 Executive Women in the Workplace Inquiry

Jill May: Role models, confidence building, just inspiration really, daily inspiration. Stretching yourself, if you like. We also did more focussed workshops on you know, networking and all the rest. So there was a – it wasn’t just one set of programmes. We did, you know, unconscious bias for men and engaged the men dinners where we got the senior executive men and got or two very inspirational women to talk. So there were all sorts of things we tried to do.

Q162 Mary Macleod: One-to-one coaching?

Jill May: We did some one-to-one coaching, but that was extremely expensive and our budget was serially cut from year to year so I did get groups of senior women. Because actually groups I found more effective than one to one, because actually you learn a lot from being in a group, you build strong relationships from being with peers across different areas, but you learn a lot from each other. You share experiences and you realise that when you’re having to fire somebody –

Q163 Mary Macleod: So just groups of women?

Jill May: Groups of women, but then facilitated or moderated by a coach.

Q164 Sarah Newton: Other witnesses have talked to us about changing attitudes even amongst girls at school about different types of careers that are actually open to them. That very much was linked to other points people made about images of successful women in the media or business, and how company’s annual reports are communicated if there is a woman CEO.

Mary Macleod: I mean, we’ve only got a few minutes left, but if you wanted to comment on any of those points.

Jill May: Do you know? I don’t know the answer to that. I’ve got four daughters and they don’t seem to have anything them holding them back right now [Laughter]. They think that the world is absolutely out there to be grabbed and I think that includes the university graduates as well as the nine year old. So I don’t know if there is an issue of women feeling anxious. What I’ve found is that the CEOs I’ve worked with, the ones with daughters are a lot more focussed on these issues. So I worked for one CEO who had four daughters and he was very focussed on diversity because it frustrated him hugely that he felt his graduate level daughters would probably not prosper as they might.

Q165 Amber Rudd: But the young women may feel this, and I have a 22 year old daughter as well and in their peer group they feel very positive about it and they look at us as politicians, heads of boards and they find it utterly perplexing because they are so devoid of any gender expectation at all. But I’m not convinced at all – I mean, I approach life like that – whether they are going to encounter the same prejudices or not. Whether in fact the same thing will happen which is they’ll come to the executive level in their thirties and whether they want to have children or not, they will receive the prejudice. They might do and they will therefore suffer and unless we do something about it, we may find that it just carries on.

Jill May: I completely agree. Unless UBS has a completely transformational moment, if Lara my daughter joins UBS, in ten years’ time she will be suffering in exactly the same way. Exactly.

60 Corrected Oral Evidence- Session 2

Q166 Mary Macleod: Because do you think it’s more, and sorry if you have covered this, do you think it’s more that prejudice is the issue rather than women not doing enough?

Jill May: The trouble is, I can’t even call it prejudice really because it’s sort of ignorance. It’s not prejudice. It wasn’t, “I don’t want women in my team.”

Q167 Mary Macleod: Conscious?

Jill May: It wasn’t conscious prejudice. They think it’s a meritocracy, but actually the way things are, it’s a self-perpetuating male meritocracy and smart women are given jobs but just little by little they are discriminated against. I hesitate to use that word because it’s not a conscious discrimination so it couldn’t really be styled as that. It doesn’t matter whether they’ve got children or they haven’t got children. If they have got children, really it’s staggeringly insensitive the way they are often treated and again, not deliberately, but just utterly absurdly. You know, with no thought about how to reengage them, how to be a little sensitive about their immediate other demands on their life. I mean just phenomenally stupid, really.

Q168 Mary Macleod: Have you got a view on quotas?

Jill May: I’ve never been in favour of quotas, but I’ve only really looked at it in the context of the board debate and I would not want to be on a board as a result of a quota. I’m out of my territory here, so I could be talking complete rubbish. But I think if you look in Scandinavia, they may have got their 40% women on boards but actually below board level there is absolutely no evidence of any improved dynamics. So, you know, you can legislate –

Amber Rudd: You need cultural change.

Jill May: I’m not in favour of quotas.

Sarah Newton: Okay, well we’ve got one minute. Oh no, I think time is up! We mustn’t prevent you from collecting your children.

Jill May: Thank you so much. Do just drop me an email if there’s anything else.

Sarah Newton: What we will be doing with all the witnesses is sending the transcripts to make sure your comments are properly reflected.

Jill May: Great, the key things are transparency of reporting and getting Lord Davies’ thinking cap on about how he puts it on the executive board agenda.

61 Executive Women in the Workplace Inquiry Corrected Oral Evidence- Session 3 Wednesday 30th January 2013

Members Present: Mary Macleod MP (Chair) Dr Thérèse Coffey MP Amber Rudd MP Priti Patel MP Claire Perry MP (Q181-end) Rt Hon Cheryl Gillan MP (Q214-end)

Witnesses: Dr Heather McGregor, MD, Taylor Bennett Dominique Hainebach, MD, Renew Partners Ruby McGregor-Smith CBE, CEO, MITIE PLC N. James Charrington, Senior MD & Chairman EMEA, BlackRock Inc. Dr Nigel Wilson, CEO, Legal & General Group PLC Evidence:

Dr Heather McGregor, MD, Taylor Bennett Dominique Hainebach, MD, Renew Partners

Mary Macleod: Good morning. Thank you very much indeed for coming in to see us today. As you know we’re doing this inquiry into the executive pipeline about women in the workplace, and this is supposed to complement the work that Lord Davies is doing, but it’s something that we felt was not being looked at very closely from a parliamentary point of view. Therefore, we wanted to look at it in much more depth and to see whether there were recommendations that Parliament needed to make, or whether it was something we needed to push out to businesses, or maybe a bit of both. So thank you very much for coming in today as our expert witnesses. Maybe we’ll just introduce ourselves so that you know who we are. I’m Mary Macleod, MP in West London for Brentford and Isleworth, and I chair the All-Party Parliamentary Group for Women in Parliament. I’m also Parliamentary Private Secretary to Maria Miller who’s the Minister for Women and Equalities. Thérèse?

Thérèse Coffey: Thérèse Coffey. I represent Suffolk Coastal. I’m PPS to Michael Fallon, the Trade Minister, and before getting into Parliament, for a short time worked in the BBC but also worked for a private company called Mars which makes Mars bars and stuff like that.

Amber Rudd: I’m Amber Rudd, Member of Parliament for Hastings and Rye, PPS to the Chancellor, and before getting into Parliament I was in banking, venture capital, and headhunting.

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Priti Patel: I’m Priti Patel and I’m the Member of Parliament for Witham which is in mid Essex. Prior to coming to Parliament, I’ve worked in corporate communications in the UK, in agency, and internationally as well for a range of multinational companies.

Q169 Mary Macleod: Fabulous. Thank you very much indeed. Clare Perry will be joining us shortly, she’s the MP for Devizes, and is Parliamentary Private Secretary to the Secretary of State for Defence, and she chairs this Conservative Women’s Forum. We only have half an hour of your precious time so thank you very much for coming in. I’ll just ask you both if you want to make any opening comments and then, if you don’t mind, we will throw up lots of questions at you?

Heather McGregor: Would you like to go first?

Dominique Hainebach: I was going to offer the same thing, which highlights the differences between how things usually work! You’ve obviously read the bios that have been provided to you, so I won’t go too much into that. But in terms of relevant points for this issue, I think one has to start looking right at the start of the pipeline, in societies and schools as a starting point and then further up the pipeline when people move into their new roles and start moving up the ladder in business. The key time to look at helping make sure that people don’t opt out of the pipeline, which is I think what we’re talking about today, is looking at people in their 20s and 30s who are having to make those key choices and what we can do to help them stay in the workplace and thrive there.

Heather McGregor: As you all know, I sit on the steering committee of the 30% Club and am passionately anti-quota, so let’s just get that on the table. But when we set up the 30% Club in 2010, and since which time I’m delighted to say that we’ve had the rate of appointment, which is the one statistic I think no one ever discusses, which I think is really important, the rate of appointment to the FTSE 100 boards has gone from 12 in 100, and it had been at 12 in 100, by the way, for 3 years, at that point, to 50 in 100, and that is just over two years. But the real issue is, as you’ve just said and you all know, is the pipeline. When we started with the 30% Club, I realised that that was a demand side initiative, and there have been lots of demand side initiatives, and actually Lord Davies’, which is a fabulous initiative, was a demand side initiative. The real issue I think now is on the supply side, and that’s why we haven’t seen the same replication of executives. That’s why I say Norway, which in active quotas, has this marvellous 40% on boards, but has the lowest number of executive women in Europe. If it’s not the lowest, it’s at the bottom 10%, so way below the average. It’s below England, the UK, which is quite extraordinary. So I wrote, as you will know, a book to address the 10 issues that I thought women should embrace in order to be ready for the supply side and, and I think that’s very much the case. I was at the World Economic Forum last week, I would say less than 20% of the attendees were women, it was just shocking.

Q170 Amber Rudd: Is that an improvement, for instance, on previous years, do you think, what’s the direction of travel?

Heather McGregor: Pretty zero. This is my sixth year or something, and I would say the WEF did have an initiative two years ago which was for a like buy one get one free, where if you took the main companies, the big companies who are members of the WEF, can take four what they call white-batch delegates, and they were allowed a fifth if they took a woman, and most of them didn’t bother. Even some of the most able women that I met last week, because I have lots of one- on-one meetings all week, one of the most able women, I suddenly realised when talking to her, was actually there as her partner’s wife, and was not there representing her employer.

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Q171 Amber Rudd: But what does that tell us? Does that come back to the business that she hasn’t got senior enough within her own organisation to be one of the four, or is it that women are being excluded?

Heather McGregor: No, she’s senior enough, in the eyes of her organisation, and if she’s not seen as being, there would be other people, men presumably, who’d be mortally offended if she was one of the ones that were picked. She was there and she was being very useful to her employer, I saw her arranging meetings and all sorts of things, but her white badge was courtesy of her boyfriend.

Q172 Priti Patel: Can we go back to basics here because I think it is the key thing. Heather, you’ve touched on the supply side, supply side is key. From your experience as a working professional in the area that you’ve worked in as well, do you think that we’re just flat lining over the years in terms of the numbers of people coming through the pipeline? Obviously, there are major blockages, but what do you think needs to be done? Is this about the workplace culture? What is it we need to start addressing, dare I say it, at corporate level, at board level, in companies of all shapes and sizes, in terms of having that even playing field so that women, for them to become as senior as some of the boys, we don’t have these artificial barriers, those unspoken barriers, and things of that nature?

Heather McGregor: I think, as you said, it’s about giving them help at those key times. So if I give a real example, which I also gave to the Business Select Committee, and it’s in the book but it’s worth repeating. I had a candidate who – as you know, I run a headhunting company that specialises in corporate communications which you’re very familiar with, and we don’t pay any of our staff on commission and so everybody is incentivised to stay in touch with good candidates forever, regardless of whether we have jobs for them or not. So I was careers counselling this girl over a long period of time and she had an unexpected third baby very quickly, she’d planned for two, three turned up. She realised she had to leave the workforce and she came to me in floods of tears because she’d wanted to be a CFO one day of a public company and she felt that this gap would be a disaster, and nobody was there. She worked for a big, big telecoms company that’s since been bought by another one, but there was nobody there to say to her there would be or could be a strategy. So I sat down with her and I said what my recommendation was that she did leave the company because three children under three is going some, but that she found a different way of remaining current because I think what happens is people don’t remain current. I suggested to her, a very able professional in the finance and investor relations sphere, a qualified accountant, that she taught investor relations and finance 50 or 60 days a year, and I introduced her to a training company, and she got a job at the training company. Then for the next three years she taught 50 or 60 days a year, which was manageable, but she stayed current and she stayed engaged and she stayed with the community and the network. Now, she’s gone to Vodafone and is in a senior finance position.

Q173 Amber Rudd: Because there’s a hole in her CV, which is such a mistake.

Heather McGregor: Yes. It’s not just the hole, people don’t mind the hole, they just mind the fact that when you go and re-interview, you just are not current both in terms of content, i.e. knowledge, yes. It’s human capital and social capital. So if she doesn’t know any analysts or opinion formers, not so much know them personally but know what they’re thinking, and she doesn’t know the most recent stock exchange regulations and accountancy requirements, that’s a very big gap compared to someone, a man who hasn’t had that three years out. So broadening that gap. Anne Spackman, the comment editor at the Times, when she had her children she was at the Independent, she

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decided to become the housing correspondent and she took a proposal to the then editor of the Independent, she said, “what are you spending on the housing page?” if they outsourced it, or, “I’ll do it for you at home.” That way she got to write about interest rates and all sorts of things that kept her very current, and now she’s the comment editor of the Times on a full time basis.

Q174 Priti Patel: Do you think, that’s quite a strategic thing to do, and of course I guess you’ve got to have the initiative and be prepared to do that.

Heather McGregor: Or you’ve got to have something like this, someone who’s prepared to pay for to come and help you.

Q175 Priti Patel: Also, at the same time though, within an organisation, I mean I say this, I’ve worked in quite a few large companies and I’ve seen this as well – could you comment on the lack of focus on that structured strategic piece around mentoring career development for women as well, and, dare I say it, women of a certain age?

Dominique Hainebach: I think it’s important to have the help and the support but it’s got to be set up so it’s not “fixing the women”, and often when you talk about developing the women and making sure they have what it takes, it sounds like you have to “fix” a problem. But it’s actually more helping people to make key career decisions and not making assumptions about whether it’s possible to have it all or not too early. I’ve seen so many people starting to make the decision of “I can either be a good mother now or I can carry on with my career”. When you test that thinking, why does it have to be one or the other, where are the boundaries you can set so that you know when it is too much on one side or the other? If you’ve already thought that through and you keep going until it really shows up that you can’t do both then you look for an alternative strategy. There are so many people who make that decision without somebody there to help them properly think it through and it’s easier not to go back to work and then too expensive to go back to work. People’s confidence is dented so much that any little thing that comes at them they think, “oh, I’m not current to work, it’s not possible, I can’t do what I used to do.” So it’s the support that you would get if you had a group of colleagues round you at a certain level who you could be open and discuss it with that would help, but often when you’re the only woman, you think you need to handle it all on your own, and a lot of them don’t open up and realise that it’s not as big an issue as they thought.

Q176 Mary Macleod: A lot of you have worked for large companies as well as many others, but if you look back throughout your careers, what would you now say to businesses, “this is what you should be doing?” Maybe it’s businesses and women, they’re two separate things.

Heather McGregor: Yes, what matters, as you just said. What matters is having someone to talk through the choices with you. I wrote that book so that people would have, and it sold 11,000 copies in 8 months in the UK alone. I don’t know 11,000 people so someone obviously is finding it. When I meet people who’ve read it who I’ve never met before, they’ve folded down pages all the way through, so I know that there is nobody really counselling people. I don’t think you can say to companies, “you must provide careers counselling to women,” because it looks discriminatory. In fact, I would say that the white, middleclass, unexceptional male at the moment is probably the most terrible place to be because people are looking to promote women, and if you are a pretty average man I think you’re in a terrible spot. But what I do think is very positive is the comply or explain mentality, because if you are a big company and you have to account somehow publically for why there aren’t more women at the top, then I think that you will start to think, golly, I must

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engage with the managers of people more and get them to intervene more at these key stages and get them to talk more to people at key stages of their life. I had no help. When I was at ABN AMRO I had no help at all, and I was a trailing spouse, so every time my husband got moved, I had to go and beg, borrow or steal a job in the next place. I had to keep my career moving forward and I had absolutely no help. So what I would say to companies, you can’t expect women to just arrive up there by themselves, they have to make some choices along the way but you need to help them make informed choices.

Q177 Mary Macleod: Is that about having good sponsors within the organisation and perhaps formalising that sponsorship process and coaching...?

Heather McGregor: Women don’t understand sponsorship. Men understand the difference between mentoring and sponsoring, and, I would point you to a very good paper by Herminia Ibarra INSEAD that was published in the Harvard Business Review on the subject of mentor versus sponsor. A mentor is someone who sits there and listens to you and suggests what you might do, and a sponsor is someone who picks up the phone for you, and I don’t think that they really build that kind of sponsorship.

Dominique Hainebach: Yes in my coaching I’m always bowled over, I run a lot of regular workshops for women who’ve got to a point where they really want to make it to that layer where it’s really hard for anybody to get into, no matter what your background, and so many are still highly surprised that it’s not about what you know at that level, it’s about who you know and what your relationships are and what influence you can effect. To get to that point and still be surprised by that, and not realise, for some of them, that you have to have had certain financial experience and certain exposure to certain tasks that are obvious things you need to have as part of your portfolio to make it to that level, is amazing.

Q178 Amber Rudd: How is it the men know and the women don’t? Is it because they’ve got a sponsor who is saying, “All right, Bill, this is what you need to do, A, B, C,” or are they just better at self-analysis and planning their careers, the men?

Heather McGregor: Men are more capable of taking it, they copy more. I’ll give you some really basic examples. These 10 things I think women need but I think everybody needs, but two of them you’ve just touched on: financial literacy and social capital. When I see people make hiring decisions all the time, because I’m helping people make their hiring decisions all the time, they look for all of these things. So human capital, your degree, where you’ve worked, everything, that’s really a given, it like gets you into the first round, if you like. Then it’s financial literacy, it’s social capital, and what employers are doing are they’re buying the whole package. But even little things like appearance. This is really ridiculous but we are all girls together and I’m going to be completely up front about this, okay? What men do is they eliminate appearance. So they make sure they haven’t got any nasal hair, they make sure that they’re wearing the same kind of tie as the person that they’re copying or whatever. They’ll have a suit and that, and they go in there and they’ve eliminated any issue of appearance. It’s much harder for a woman. I’ve had people turn up on my doorstep saying, “oh, I haven’t made partner again at Price Waterhouse,” and with the most inappropriate amount of cleavage, and you have to say... [Laughter] Really, honest, nobody has said that because it’s not considered appropriate to say.

Q179 Priti Patel: Just on that point, I’ve had so many experiences in the past anyway around those kinds of experiences, and awareness, it’s the self-awareness I think that comes with it. This

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is cultural as well, particularly in large organisations. I mean what is your experience, and I hear this still from women in the workplace, people that I used to work with, about the actual boys culture, the late hours culture, drinking culture and things of that nature, which women still find as a massive turnoff, a barrier, etc. It links into appearance, it links into behaviours, do you have to be a successful woman, do you need to ape male behaviours, what are your views and thoughts on that?

Dominique Hainebach: I think you have to look at both sides constantly. You’re saying, I think you’ve got the demand side sorted. I’m not sure it’s quite there, I mean there’s a demand side...

Heather McGregor: It’s not sorted, but I was saying it’s only 50% of the issue.

Dominique Hainebach: Exactly, yes. So on the one side, coaching women and making them aware of what it is about their style that is sometimes holding them back, or their appearance or whatever it is, and on the other side training men to understand about unconscious bias, about the kind of things that they naturally do that are actually making it very un-inclusive to other people, and the sort of culture that’s bred. We will all, well, good people won’t, but most people tend to select in their own image, so you will find that, I’ve actually seen it, a couple of women, very senior women, you look at their team and they’re all women like them. You look at a successful man and he often has a team that looks like him, and to train people how to recognise diversity and how to be inclusive and make the most of the talent they’ve got is a skill. Not everybody will just naturally have that, so it’s quite a complex issue, but awareness and training on the one side and awareness and coaching on the other is helpful.

Q180 Thérèse Coffey: Last week we had some corporates in, Microsoft, our guests, and BAE, so unconscious bias is definitely coming up the agenda. Heather, you’ve mentioned there financial experience. Recent research shows that actually executive women were more likely to have it. So is it a case that women have to overcome a stereotype by having actual qualifications or is there something on that? On the coaching thing, what was very interesting, I think it was RBS who said, “coaching is available, a lot of women just don’t take it up.” So is there something here about what is it that we can do to encourage women to take it up?

Heather McGregor: Yes, but who’s going to encourage them to take it up? Everybody needs some kind of godparent inside the company to say, “look, this is available, you should take it up.”

Dominique Hainebach: There’s also a style issue. I mean for women, we’re talking hugely in generalisations but women tend to not put themselves forward in the firing line as easily as men do, and there are all sorts of biological reasons for that as well. But they will not want to put themselves forward for something that looks remedial, so if coaching is positioned almost as a remedial intervention, they’re not going to take it up.

Q181 Amber Rudd: Showing weakness, they think?

Dominique Hainebach: Showing weakness. If coaching’s offered for all people with potential who you think can be taken that much further by having this sort of intervention, and it’s going to actually help you be a better leader, and it’s open not just to women for example, but all people returning to work after an absence or all people moving to the next level or however you position it, it will be taken up by...

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Heather McGregor: Rather than just being available, yes. Goldman Sachs is a very good example of that. When they identify talent that they think is going to make managing director, they put two things in place, a coach and a mentor, and if you’re a woman who is coming though that place, they will usually provide you with a female mentor from amongst their female managing directors – which are not many. Fiona Laffan made managing director recently, she’s the head of corporate communications for EMEA, and I’ve watched very closely as she joined, they spotted her talent, they allocated her someone to guide her through the process to make managing director. All the big accountancy firms, when they think you’re going to make partner, they usually allocate someone and put you on special training. But who’s spotting people to recommend them for that? That’s what I mean. I think if companies have to comply and explain a bit more, they will more actively spot. So when we put the pressure on public companies to comply or explain at board level, wow, we suddenly went from 12 and 100 to 50. Now what I’m seeing as a headhunter: I’m doing two big jobs at the moment amongst several others, two specifically very big jobs, one is an investor relations job for a FTSE 10, and the other one is a corporate communications job for a very, very big trade association, a pan-European. They both have said to me, “we would so like to appoint a woman.” Now, that is obviously a wish, not a command, but they have expressed that to me, and they basically, when we brought lists to them and didn’t have enough women, they were like, “go back, try harder.” I am also aware that the general management headhunters have seen a change in chairmen seeking more women on shortlists, something that was not happening even two years ago.

Mary Macleod: Okay. Claire?

Q182 Claire Perry: I’m a bit out of date because I left banking 12 years ago. I was interested in what you said about the coaching and monitoring. In my experience, women generally took a more maverick approach because that was the way to distinguish yourself and perhaps it gets back to the cleavage and that they’re on to me role. So you find a niche that only you can occupy as a way of distinguishing yourself. Are you seeing firms though, you mentioned Goldman Sachs which I think probably does this well, who are willing to bring in outside coaching and mentoring help for first that do have a dearth of senior women? That’s one thing I’m interested in, getting firms to recognise that and try and bring in, perhaps not from the competitors but from other industries? Then the second thing is what the business core called the “mummy track” back in the 1980s, the idea that talented women will leave, they will leave at some point because we all know the biological imperative of motherhood sometimes means you just want to leave, but you have to be able to come back. The best firms I think probably recognise that and are set up for that, but is that your experience and have they accepted the point yet that women may want a career break and be willing to accept what comes with that? Like in politics, some of us have come back to it somewhat rather later in life when our children have grown up and we feel we can manage.

Heather McGregor: I might leave you to answer the question about the outside coaching, but to reiterate what I passionately believe that I said earlier which is that people who take career breaks are, by the way, not just for children. The other big source of career breaks are ill parents, husbands who get posted abroad, which is what happened to me, etc., etc. So I think that everybody who for whatever reason chooses to take a break from their current career needs a strategy, and I think that’s what people don’t realise they have to have a proper strategy to make sure that re-entry is going to be possible. It doesn’t matter what their strategy is. They need a strategy that continues to build, as I said earlier, human capital and social capital. So they need something that keeps them technically current in whatever they are interested in, that can be volunteering somewhere, and also keeps them – I always say to people, “go and volunteer at Central Office,” is one way of

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seeing life in the fast lane with minimal resources and maximum things to achieve and build your social capital at the same time. I know people who’ve gone and done that and come out the other side and got a paid job. It’s that there are equivalents to that.

Dominique Hainebach: There’s this assumption that women are the ones who always make the compromises in terms of career breaks. I think we’re looking at women at the moment but I think if one expanded this issue to the Generation Y problem, we have a lot of young people coming up who want to share familial responsibilities, who want to spend more time with their children, who don’t want to be working all the hours, where there’s possibly more of a choice about who takes the career path versus has their own business or does more of the family responsibilities. If one can expand this issue to people who take career breaks and helping them with strategies for returning, organisations who are able to deal with the more flexible lifestyles and comings and goings and the technology generation that’s coming up, that’s going to be a necessity anyway.

Q183 Mary Macleod: It was interesting what you were saying earlier about some of the changes you’ve seen, whether it’s Goldman Sachs or organisations saying we really want a woman to take on this role. Is change happening, are you positive about the future? Because we’ve talked about this for decades, this sort of subject, and I tend to worry that we tend to talk a lot about it but not much action happens within organisation. So given all of that, how positive are you about the future? Also, is the work that’s happening at the moment, whether it be the Lord Davies work highlighting the issue for transparency and reporting, whether it’s looking at more flexible parental leave and flexible working, will those things make a difference or is there more that Government should be doing?

Heather McGregor: I’m very optimistic about the future because one of the other statistics that I think is very important to watch, and these are things that are reported quarterly is not only the rate of appointment of women to boards but how many of those women have never been on a board before. So now we are in a place where we’ve recycled. If you’ve found Barbara Judge on yet another committee, you honestly thought it was like Groundhog Day, and now we are in a position where, I don’t know, Tracy Clarke who’s heard of HR at Standard Chartered has just been put on the board of Sky. That’s the kind of thing I really want to see more happening is people who’ve not been on public company boards before being appointed and that is really happening. About half of the women who’ve been appointed to a FTSE 100 board in the last year have not been on a board before, and that’s really an important advancement.

Q184 Mary Macleod: That’s mostly non-execs.

Heather McGregor: But that is mostly non-execs, but what I mean is it’s got people to challenge the status quo, and so the reason I’m optimistic is people have seen what can happen if we have the willingness of business leaders, and I do think comply or explain. The difference between when we set up the 30% Club is at the time people were saying why, “why should I do this? Why should I come and support you?” and now they’re saying, “how?” People coming up to me in the streets will talk to me, “how can I sign up to the 30% Club targets?” That’s a very big difference.

Q185 Mary Macleod: That’s in the last five years, two years?

Heather McGregor: Yes. I was looking at our interview statistics. I know that we do a good job within anyway, you know my big issue, as you know, is ethnic minorities where we’re not running

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a 10-week training programme, which I pay for myself, to get black and minority ethnic people into corporate communications at the bottom level because very, very few enter, and that’s where I’m having problems. But if I look at the rate of appointment, so shortlisted candidates, male and female last year, 93 to 92. Previous year, 65 to 69. Previous year 110 men to 90 women, but most years it’s identical, but I think the real teller is that when you split it down into the basic salaries of the people that we put into jobs last year, at the 60 to 99k basic salary level that was roughly equal at the 100 to 149k level, it was 50% more men, and basic salaries of over £150,000 we had no women placed last year. So I think there’s a lot of work, but I’m optimistic...

Q186 Claire Perry: It’ll come through, it sounds like the pipeline’s coming through.

Heather McGregor: Well, yes, we’re there sort of bottom end, but compare that to – men have always been – I’ve only done the last four years of analysis – I’ll email this to you afterwards so that you have it – when you compare that to how many people we meet. So face to face in the last seven months we’ve interviewed 264 men and 270 women. By the time we’ve asked you to come in you’re pretty good anyway. In terms of phoning people, we phoned 488 and 501 women. It’s roughly equal opportunity really. We’re running a private detective agency anyway, not a...

Q187 Mary Macleod: Dominique, are you positive, optimistic about the future?

Dominique Hainebach: Absolutely, but it is a culture change and a culture change needs a lot of effort and focus, keeping up that focus, keeping up the questions, not letting it go until it’s trickled down, not from the board level who I think get it but get it now, but down to the next level who are more threatened by it and more where it makes life more difficult for them because they’ve got to go out and find different types of candidates to the ones that are easy to find, and all those sort of things. So it’s more effort coming...

Q188 Priti Patel: Do you have any views or can comment on any particular sectors or professions that you think are doing pretty badly in all of this, and what they need to do to wake up and smell the coffee?

Heather McGregor: Well, the real issue is resources and less so for financial services. The commodity boom is such that some of the world’s biggest companies are resources companies. Three of the biggest resources companies in the world are currently changing their chief executive. I think one of them has announced who the replacement is, and the replacement for Cynthia Carroll is a man. Then the replacement for Kate Swann at W H Smith is a man. Then we’re going to see what happens with BHP Billiton and Rio Tinto, well, I think Rio Tinto we know and it’s another man. So I think that the resources is really big. For instance, I did a big job in the resources sector at the end of last year and I was asked to, again, it’s a whole separate from the one I mentioned earlier, asked to push for a woman and I had to work my way down to about the third level of people in the finance around the world. So Randgold, for instance, has only just this month appointed a woman onto the board; it was one of the few FTSE 100 companies now, less than 10 that have no women, but they’ve got two really good women in finance. In answer to the earlier question about are there finance qualifications, I say in my book that there are really critical things. I think every woman aiming for the top should at least take her management accountancy exams which are not a particularly difficult thing. If you go onto the Unilever graduate training scheme, this is like for years now, for 20, 30 years, they would put you through those.

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Thérèse Coffey: Sorry, so I’m obviously not qualified! [Laughter]

Heather McGregor: I think everybody, I was trying to say not use specific language but it’s true, I think everybody should be CIMA qualified, it is a basic level, it’s not very basic when you come to do it but you don’t have to be a qualified chartered accountant or a qualified CFA, both of which will also, by the way, help. But there are levels of financial literacy that I think are really, really key to women moving forward, and I would encourage more companies to train entry level women at that level to have some kind of management accountancy basic... The other thing is with a piece of paper. It’s all very well going on internal courses, okay, but without a piece of paper, very difficult to take that and have it on your CV and move somewhere else with it.

Q189 Thérèse Coffey: Could I ask perhaps the final question. It’s to do with the Cranfield Report and appointment processes. There was a section there that the voluntary for executive search firms doesn’t go far enough in its provisions. In your general experience, is it easy to hit the 30% long list?

Heather McGregor: Well, I’ve given you my statistics and they’re way in excess of the voluntary code, so I think it’s perfectly, perfectly straightforward. I think unless you’re looking for a mining specialist with a certain number of years down a mine kind of thing, I think that honestly, it is possible to find, in this country it is possible to find women. But they don’t put themselves forward, as you said.

Q190 Thérèse Coffey: To go further, do you think, it should be a requirement, perhaps not a statutory, but a strong recommendation that at least every panel interviewing should have at least a woman, and at least every group of people being interviewed should include at least one woman?

Heather McGregor: I’m not a great believer in more legislation. But I do think that we have this wonderful tool in this country of the companies’ code for instance. The problem is the companies code only applies to listed companies or companies that are report that, but I do think that comply or explain, so if you are forced to account for why you’ve made the last 10 appointments of men. So get people to report their appointments in not just the board level but the next three levels down. Instead of saying to people, “you must have a woman on the panel,” or whatever and trying to prescribe too much, what you could say is, “I want you to tell me, I want you to report your appointments down to everything above 100k upwards,” or something in terms of basic salaries, “and let me see how many are women.” You will find that when the spotlight is on these companies, they will start to say, “we must have more women on this long list.” So it’s rather than prescribe the actual way they get there, I would make them account for themselves much, much more than they do at the moment.

Dominique Hainebach: You asked the question what can Government do, and that’s probably the most helpful sort of thing that Government can do apart from in terms of policies and best practice that’s put out there from the government, making things gender neutral in terms of the workplace. So if there’s maternity leave for a year, why maternity leave, can’t it be parental leave?

Thérèse Coffey: We are doing that.

Dominique Hainebach: You are doing that. Exactly. So examples like that of reviewing what else do we have in place that makes this assumption that it’s the woman who compromises all the time and what’s rewarding that behaviour versus something else.

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Mary Macleod: Brilliant. Heather, Dominique, thank you very much indeed, we really appreciate your time. If there’s anything else you want to share with us in the next few weeks, please feel free to send a memo or send it into us.

Thérèse Coffey: We might right to you with a couple of questions. Thank you so much.

Ruby McGregor-Smith CBE, CEO, MITIE PLC

Mary Macleod: Ruby, thank you very much indeed for joining us this morning. We’ll just perhaps quickly introduce ourselves. I’m Mary Macleod, I’m the Member of Parliament in West London and I chair the All-Party Parliamentary Group for Women in Parliament. I’m also Parliamentary Private Secretary to the Minister for Women and Equalities. Thérèse?

Thérèse Coffey: Thérèse Coffey. I represent Suffolk Coastal. I’m PPS to Michael Fallon, Trade Minister, before Parliament I worked a little bit for BBC and for Mars.

Claire Perry: Claire Perry, MP for Devizes, PPS to the Secretary of State for Defence and the Prime Minister’s Advisor on the Commercialisation and Sexualisation of Childhood, and had a private sector background until I retired and came into politics.

Amber Rudd: Amber Rudd, Member of Parliament for Hastings and Rye, and I’m PPS to the Chancellor, and I chair the APPG for Sex Equality.

Priti Patel: I’m Priti Patel, I’m a Member of Parliament for Witham which is in Essex, and prior to becoming an MP, I worked in the corporate communications industry for over 10 years.

Q191 Mary Macleod: So that’s us. There may be another MP joining us over the next hour. I think we’ve got you until 10:15. So thank you very much because I know you’re extremely busy. What we are doing in this is hopefully supporting the work that Lord Davies is doing which I think has made real progress about women on boards, also in conjunction with working alongside the BIS select committee doing work about women in the workplace. But what we felt was that there needed a little bit more focus about the executive pipeline because we are making progress overall at board level but there is more work that needs to be done, right throughout the executive pipeline. I really wanted your views, given that you’ve had such an exceptional career and done some great things. Congratulations on your recent CBE, very well deserved. So we really just wanted to ask your views on what you felt about the executive pipeline, and of course you’re also chair of the Women’s Business Council, and I’d be interested to see whether you’ve considered any of this as part of that. But maybe you just want to make a few opening comments and then we’ll fire questions at you.

Ruby McGregor-Smith: Okay. In terms of the executive pipeline, I think it is a really important issue to focus on. For me it’s been much more interesting on that than the Lord Davies report. I think there has to be a real distinction drawn between public company directors and the executive pipeline that sits beneath it. Actually, it’s fantastic. I do a non-exec role as a female as well, Michael Page International, it’s fantastic, but this is a corporate governance statutory role that doesn’t necessarily influence what you really need to do in the workplace. I think there needs to be a very clear distinction between what public company directors do as non-executive directors, and what public company directors do as executive directors. Their roles and responsibilities are

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certainly different on a day-to-day basis, and when you’re only with a board a handful of times a year, there is only so much you can do unless you’re asked to take on the additional responsibility as I have done at Page, supporting around diversity and what they need to do in the workplace. That is not what every board may choose to do with its non-execs. Moving on to the exec pipeline though, I think the really important point is to focus on the pipeline of talent in any organisation that’s coming through, and to understand the barriers at every single level that stop you being an equal employer. I think for me it’s actually wider than gender, it’s an issue for me around minority issues, so it’s around race, it’s around disability, it’s around gender. I personally, running a FTSE business, don’t see any real distinction between those. I think with a pipeline, to get the best pipeline of talent in the organisation, you absolutely have to take away the barriers that stop that talent really rising to the top. Barriers at every level, gender is one of those. Potential barriers at some levels and the ramifications around having a family. I’ve been there myself. I had to leave my previous company, I couldn’t work for a while, I had young children, it was impossible to do a global role and get on a plane on a Friday because my employer needed me to because there was no flexible working at that organisation 10 years ago. The workplace is moving on, but I think the debate around the pipeline is really important, but to focus from why you get barriers, and I think organisation, public or private, need to focus around equality in the workplace far more than they necessarily do. I think the focus just on specific things around equality, for me are not wide enough, because actually it’s about an education to your own people, because it’s your own people that are hiring at more junior levels, and they need to understand what equality in the workplace really means and what it really gives you. So if you do actually have to have employees who need more flexible working, for many reasons, not just because they’ve suddenly become a parent, but there could be many, many reasons why they have, or you need to think differently because of their family background and the fact that they can only again do certain things in the way they’ve been brought up – there are a whole range of reasons why you need to think differently. Your teams need to really understand that because when they’re hiring, there is a real danger that as you hire, you come against this whole world of unconscious bias, and that you have to explain very simply and train everybody on issues such as unconscious bias, because for many people they don’t really know they’re doing it, and I think you’ve got to go really, really basic. The focus I think, certainly in my company, and maybe my industry has had to do this slightly differently, I think younger industries who’ve grown very, very fast in a tough economic environment have had to say what really matters is the best skill base. We can take all of these wonderful things that we’re supposed to do or not do, how do we get the best skills to run the business to generate the best returns for our business overall? I think then you do get a real focus from people saying if we’re looking for the talent, what else do we need to do, and I think this whole area around training and development mentoring and all these great things have to be done to get you the best talent. So I come from quite a different angle maybe to others, but actually I think we’ve seen some real benefit of that. If I take a look at some of our statistics over the last five years for the things we’ve started to change internally, we can see a real rise in terms of gender specifics at a more senior level in the pipeline. We have focused actually – people talk about age, but if you’ve got a really talented 25 year old, why can’t he be one of your exec team? Age shouldn’t preclude them. So how do you make sure that that talent rises to the top? How do you make sure you look at the challenges around race and minorities as well at every level? I think we’ve seen some real improvement. I mean we’re nowhere where we necessarily would like to be but we can see improvement year on year by adopting more of that approach, and I think particularly around unconscious bias training, I think that’s been a critical part in doing it.

Q192 Mary Macleod: I’m really interested in the interventions that work because businesses, and I was in business 20 years, we’ve talked about this for decades and whether it’s racism, disability or gender, we haven’t made huge strides on. So I’m really interested in what you think really works

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and you’ve mentioned some of those already? How important is leadership in all of this, so does it have to come from the chief exec or the chairman down and embed it, and also how important is performance measurement as part of it, and maybe even tying it to pay and rewards, is that something you’ve tried?

Ruby McGregor-Smith: I think it’s around leadership and saying this is important to us and why, and if the CEOs of organisations believe it’s important for their business, they’ll do it, but in many cases they maybe need to be a little more experienced about why it works for them. I think most are very open to saying okay, we see why it works, and if you take a look at the very simple statistics, if you don’t retain your best talent, it ultimately costs you more or you have to go out and start again. So if you’re trying to develop talent and you put mentoring programmes around individuals, training programmes around individuals to bring out their strengths, support them on their weaknesses, etc., you’ve actually spent quite a lot and you’ve invested a lot of money in your people as you go through an organisation, large or small. Why on earth would you then want to get that wrong because economically if your business is the right thing to make sure you focus and get that right. I think the embedding piece is important, so it’s very nice to say all this but actually what do you do? I think we’ve got to be quite careful about all this view on reporting externally because there is a real danger at the moment around regulation reporting that we build layer upon layer of reporting because everyone thinks we need to do different things and you stand back and you look at my annual report, and I can’t make head nor tail of it anymore as to what it’s trying to achieve. [Laughter] Someone actually does need to stand back and say, “why are we writing 120 pages now of all these wonderful things, does it actually help my business grow and develop?” Some of the things we have to report on don’t do that at all anymore. I’m sure they were fantastic originally and were right for the right piece of regulation, I’m sure the combined code is right for what it’s trying to do, but you know what, life is moving very quickly and it never seems to keep up. But if we’re going to go down a route of more reporting, which actually I think could be useful - you’ve got to be careful when you want more reporting because that actually means you need more systems and more investment to do it, particularly in bigger organisations and large people organisations like mine, particularly when you’ve got churn of staff, that’s quite challenging to do. So it’s got to be practical reporting that people can do and give them some time to get used to it, but I think you kind of need to stand back at the whole how do we report and say, “what are we trying to achieve across a number of areas?” and put all the areas together in a people piece that says you know, if you’re trying to attract the best talent and grow your business, then you kind of should be reporting on the following things. Focus it on a talent debate, not on the you’ve got to be better on gender because I think we’re all saying we should better on gender because we think it’s right for talent that you should be better on gender. I get very worried when I see recommendations such as, “you should always have X number of people on your shortlist.” Well, I’m sorry but you’re only going to interview good people so you’ve got to be able to go and find good people to put on your shortlist. Please let’s not get to a stage where you’re reporting on shortlist and you’ve got to put people on there that look right. That isn’t the right approach. Build up the talent piece differently. So I think it needs a bit of stand back because I do think if you look at most company reports, I’m very confused by what they’re trying to achieve. So I think a little bit of that would be fantastic to see.

Q193 Thérèse Coffey: Could I ask two things. We’ve got investors coming later, so Legal & General and BlackRock.

Ruby McGregor-Smith: Some of my investors!

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Q194 Thérèse Coffey: Does that ever come up? Are they interested, should they be interested? The second thing just about your company, I hear what you say about the systems, but do you collect data so that you can see the outcome effectively, do you have a pipeline of talent that reflects...

Ruby McGregor-Smith: We do for our population of our senior managers, absolutely. It is very difficult today, I’ve got 72,000 staff.

Q195 Thérèse Coffey: Yes, but above a certain level?

Ruby McGregor-Smith: It is very difficult to do but we’ve actually made it above a certain level on pay band but also on job level to try and understand because it’s really important, we want to widen that as much as we can. But the challenge of collecting the stats is important and your systems and processes behind it with my client base is also really important, and we have lots of bespoke things done for different clients who want things done differently. So you’ve got to think about what you’re actually trying to achieve. I think we’ve made a really good start but I think role models in a business really help it anyway, and in my business we’ve got two public company directors that are female. I’ve got an HR director that’s female, I’ve got a good mix in my executive team, so 30% of the executive team are female. That in itself makes a huge difference to how the business is perceived internally and externally, and I think that does matter, to be fair. Actually, that matters to me more than some of the stats because that means that I know those stats will go up because I know that the impression is already embedded that that is the way we work and want to continue to work.

Q196 Thérèse Coffey: The investors?

Ruby McGregor-Smith: I obviously have been doing investor relations for a decade, and I would suggest that the thing that comes up more is how I’m going to grow my earnings per share is their entire focus and how I’m going to get total shareholder return. However, what I would say, I have long term value investors predominantly, so I can only speak for them and most of them have been shareholders for the group since I’ve been there in some way, shape or form; although the fund managers may change predominantly the mains funds holders that I’m sure you’re going to see. We do talk about talent and how as an outsourcer, I will have the best talent to grow my business. We don’t necessarily talk about CEOs stats, and nor should we. You’re talking 20-minute meetings with five people in a room, it’s not going to top of their list, but they are going to assume that you do all of that as part of what you do. They would not invest in businesses that didn’t invest appropriately in that because they wouldn’t get the returns. They wouldn’t necessarily ask it as a direct question but for me it’s something that, should they ever want to ask and occasionally they might do, they do kind of meet the people. So they’ll meet quite a lot of my people, and they like to understand the breadth of talent that we’ve got because in a people business, that’s what you’re actually buying on a share price. So in our industry I think you will probably see that they would be more interested but it’s not always going to be top of our list as you can imagine!

Q197 Claire Perry: Thank you. It’s very nice to have a conversation about earnings and shareholder return, since we have statistics suggesting women with financial qualifications in British companies, etc., because clearly you have a financial background. Do you think that’s important, and what can we do to encourage women in the pipeline to acquire these kind of qualifications that show that women actually can do numbers?

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Ruby McGregor-Smith: I think it’s really important if you’re aspirational and you want to run a company, you need to get numbers. I’m not saying we’ve all got to do what I did and become a chartered accountant, I’m absolutely not saying that at all, but I’m saying that you absolutely have to have the acumen. If you’re going to run a business and you’re focusing on M&A strategy, you’re looking at divestments, you’re looking at winning big work, you’ve got to have some understanding of the commercials, even if that’s not your natural background. I would say that most people will go out and have additional training and development. Certainly my senior team who haven’t had that, I would send on specific courses to help them with specific things that they may need to know. For example, one of my team’s more involved in M&A today, he’s just finished at Cranfield recently on quite a detailed course just to go through some of the things that he wouldn’t necessarily be familiar with. So as we start talking in multiples and numbers, he gets that. In terms of women, I think absolutely. I think for me it was a confidence thing, if you’ve got the ability it helps with your confidence. I can only speak for myself, but certainly when I had children I kind of lost a bit of that and it was quite difficult to readjust to the workplace and I had to take some time out with young children, etc., and I found self-confidence a real challenge coming back into the workplace. We’ve actually done quite a lot with our mentoring when our young women go off on maternity leave around return to work schemes, getting them back used to it, we stay in touch regularly, we help them in gradually because we do it because we know what it feels like to feel in that way. I think as organisations have more women towards the top of them, more of that will happen naturally.

Q198 Priti Patel: I think that’s an incredibly important point that I have lost confidence in.

Ruby McGregor-Smith: I think it’s something that people don’t talk about, they need to talk about it.

Q199 Claire Perry: Yes. I always have a hangover from business school days as I think I’m bad at numbers, but my sense though is that young women are increasingly being turned off.

Ruby McGregor-Smith: But I put that down to careers guidance. Recently we’re doing some work with the Women’s Business Council, and if you take a look at what careers guidance do you get at 16, about what do you do, or 15, it’s not joined up because it’s devolved. Therefore, it comes down to where you go to school and what that school thinks. There is no link with business, so unless you’re raising aspirations of young people and you’re really serious about young women, and I think there is a huge on-tap talent in young women today who don’t realise what they’re capable of. I think the competence piece is really important. I didn’t know at 16 what I wanted to do. My dad was a chartered accountant so I ended up doing that because he kind of focused me on doing that. I kind of did it but I wasn’t that keen actually to begin with, but it was a good thing I did, but it’s getting that. The challenge you have though is to make some of those subjects a bit more exciting, not everybody thinks that those are interesting business subjects, and actually it was the best thing I could ever have done.

Q200 Mary Macleod: Certainly some of the businesses that came in to see us last week said it’s the lack of girls that are taking maths, and at least if they were taking maths it would be a starting point, and then they could have the choice of careers in engineering and those other sectors.

Ruby McGregor-Smith: Absolutely, and you don’t have to amazing at maths. We’re not saying everyone’s got to be top of the class in maths to be an accountant, no, you don’t, but you just have to have a little bit of interest in numbers.

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Q201 Amber Rudd: When it gets to a very senior level like yourself and other senior women, childcare becomes less of an important cost in terms of going back to work and managing your lives, but at the perhaps more junior level where women are beginning to get going on their careers and we need them to stay in their careers if they’re going to stay as part of the pipeline and hopefully become successful further on, childcare costs can be quite a difficulty for young families. Do you find that puts women off in terms of coming back to work?

Ruby McGregor-Smith: It’s totally prohibitive and I think it needs to change. We’ve been talking at the Women’s Business Council about some of the changes. My sister’s currently, I’ve got one sister on maternity leave at the moment and about to go back, and I’m a little bit staggered, and I’ve got the other one just gone back to work, it’s just too expensive. I’m very passionate about tax breaks for it. I know there’s not a lot of money around in the country, but you know, if we’re really serious about pipeline and talent and getting young women back into work, we need to do something about the cost of childcare and flexible working. Those two things will make a huge difference in how people work, particularly in the first year after they come back and readjust. I don’t know about any of you but it took me about a year to readjust.

Q202 Amber Rudd: There’s lot of requirements currently in flexible working that companies have to address, when you come back to work, request it, but coming back to childcare again...

Ruby McGregor-Smith: The cost needs to be supported, it is too expensive and I think it is hugely prohibitive, and you have to ask yourself why you would come back when financially you may be no better off.

Q203 Amber Rudd: You’re investing in yourself is the only way to approach it.

Ruby McGregor-Smith: Well, except it is a tough transition, you know, taking your child to nursery, we never had to do that. Okay, putting up with whatever arrangements you may have, dealing with all the sicknesses that come in Year One, all the things that you’re no longer in control of I think really matters. I just think that that whole cost piece needs to be analysed and dealt with differently, because if it isn’t, I do think that pipeline for that specific part of the gender population will not change. I think we should be really honest about it because why should it change? It is not going to change unless they get more financial support.

Q204 Mary Macleod: If you were to ask the Chancellor, and you have the Chancellor’s PPS here, for one thing on childcare, what would it be?

Ruby McGregor-Smith: Tax breaks for the first year after a woman comes back to work.

Q205 Priti Patel: For one year? That’s a very interesting idea.

Ruby McGregor-Smith: Yes. Just transition, help them transition, because it takes the psychology away that there is still a financial benefit to coming back as opposed to “I just can’t face it,” and we shouldn’t underestimate the toll on young women today. The pressure on a young woman, particularly early 30s who really wants to have a career, who wants to do really, really well, who knows when they come back in that first year that they’re going to be working less hours, that yes, technology aids because they can do more, that they will not look or feel as they did, that they know it’s different. I think any support they can be given financially is really important.

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Q206 Amber Rudd: That’s really good to know, the idea of the transitional, because...

Ruby McGregor-Smith: It’s a transition. I think it’s a transition for me. Then all the things start to come back again, that it’s okay to do this, and I do think the psychology should not be underestimated.

Q207 Amber Rudd: We heard about a company in Germany recently that offered to pay for women’s childcare for the first year, in order to give them the incentive to stay, and they just made it so that you’re not going to get a rise, but they will pay for your childcare for two years. This was a terrific incentive for the women to stay on and to make that transition. Do you think it’s something that large companies –? There was some sort of tax break involved in it as well, for the large corporate – but what about that sort of approach? Do you think that would be attractive?

Ruby McGregor-Smith: If you support business in any way to help retain its talent, and support it through tax breaks, of course it’s attractive, but you have to provide an incentive, because otherwise the danger is that you can do that, but they may not choose still to come back. It won’t be enough if you just put it back on the business, because they still need to do the transition; the return to work and everything else as well, to make sure that they stay and come back. You’d have to make it attractive to business, but actually I think it’s about leaving a woman with control of her finances; make it more financially attractive to her to come back to work. We shouldn’t underestimate the impact of the last five years on the economy, and actually how tough this is for people. I look at some of our young people. This is harder than I had to do it 10 years ago; much harder.

Q208 Amber Rudd: Because the cost of childcare has gone up relatively –

Ruby McGregor-Smith: Costs have gone up so much, and we are in a different economic cycle. It’s tougher, and you’re having to work incredibly hard to achieve less. All of those things take that toll. I just think the psychology piece is underestimated. If you talk to my young people today when they come back, they will say that’s the support they need. They really do need that support.

Q209 Priti Patel: I’m going to make a sweeping generalisation here, but I don’t think it would be objected to. I’ve worked in the corporate world; I’ve worked for a lot of multinational companies, and not just in the UK. When I have seen women in the workplace, they work incredibly hard. They are determined and very focused. They’re always feeling they’ve got to outwork the men in order to be successful, and to be seen to be successful. In light of some of the challenges, and I think childcare is a really interesting one: I’m currently the mother of a four-year-old, and I had my child just before I came to Parliament, when I was working in the corporate world, as well, so I have shelled out a lot of money on childcare. What is your view: you’re a working woman; you’ve got to pick your child up from nursery, and you’ve got all those pressures, about that cultural piece where women fit in? When there is, in many organisations, still a male-dominated culture where there are late hours and they go out drinking, etc. How do you feel that can change going forward? How do you think we could do more to support women, and nurture them, in light of that cultural setup in the workplace; in the working world?

Ruby McGregor-Smith: I think it is changing. I say it’s changing actually because generations change it. I don’t go out every night. Nor should I; I’ve got my children. I don’t have to do all this endless networking in a bar. I don’t need to stay until midnight, so why does anybody else;

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and I run one of the biggest companies in the UK? I expect my teams to work really, really hard; absolutely, we’re on technology in the evenings. We’re doing emails; we’re doing this. That’s fine, but you change cultures by the people that lead the organisations, and actually, why didn’t I go into an industry that was more traditional? It was because I’d never have wanted to do that as a female. We shouldn’t underestimate female choice here. Many talented young women, who know that they want to raise a family, will not want to work in that environment. The reason the pipeline for talent is so difficult in some other organisations, and why it’s so difficult for them to break, and why public company appointments won’t break it, is because the culture is endemic, and it won’t change. Has that really changed? I’m not going to generalise on different types of organisations, but I think, actually, it has got to shift, and I think organisations that don’t change it won’t be around, eventually, because if they’re not prepared to deal with those really basic issues – we don’t have a culture at work that says if you don’t go out drinking, or do this, or be seen in the office till 10 o’clock at night then your career will not be rewarded. That is just a ridiculous thing to say today. More female role models, more male role models who believe in different things, and many do, and don’t do that as well, change it. It does come down to the business you work for. In my 20 years of outsourcing, maybe in the early days, I saw it more. In the accounting profession, maybe more. In my business, maybe elements of it here and there, but it’s not the way we run the business. I think that’s the important piece to me, and can I talk for other industries? No. You’re absolutely right; male-dominated industries will face more challenges. Many of my senior managers are male, but they’re okay with all of that. They’re okay with not having to do it. Some of them do do that, but it comes down to parental responsibilities. Many of my senior guys have got too many children to worry about, and things to think about. The work-life balance has changed a little bit; I think people realise that, and actually, we feel that work-life balance is important. We’ve still got to work incredibly hard to achieve a good set of results. I am more positive, but I think it depends on the industry you work in.

Q210 Thérèse Coffey: So could you tell us a little bit...we’ve heard from BAE and some other people about this unconscious bias. It was interesting to hear from RBS. They only do it in regards to recruitment; with BAE it’s automatic now, over a certain level, that this training is there: not only for women, but as you were suggesting earlier, for men too, and all sorts of decisions and trying to produce that ‘mini-me’ kind of attitude. Could you explain a little bit more about what you’re doing, and also some of the work that the Women’s Business Council may be suggesting about some of the advanced practices that you enjoy?

Ruby McGregor-Smith: I think I wrap it up: we’ve been talking about this at length on Women’s Business Council recommendations around a number of issues, which is around mentoring programmes, and making sure that you’ve got a mentoring programme for your people, whatever population you choose. Obviously, you’re going to choose your talent population. Where you’ve really targeted succession you’re going to look at that population to really, really, really embed and drive the culture through that you want. Make sure that they particularly have got, and they and their managers and teams have got unconscious bias training set up. Do you know, it’s not really that hard to do? You can just do it. These are electronic tools. You can roll these things out very, very quickly to a lot of people, should you choose to do so. This is not something where you have to go and sit and be taught it. You can actually just understand if you deal with it yourself by filling in a questionnaire on the web, and it’s fairly easy to work out if you need some training or not. That is not for me about gender; that is the wider debate about equality. I think the roll-out of that, and we do that at probably for us a couple of thousand people have been trained across the group in that, we’re targeting the managers that recruit, and those that are responsible for developing people, and that we will make sure that they have got that training in place. We have set a lot

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of that up in the last two to three years. Can I give you evidence of what that is showing yet? I don’t think so, but I can give you evidence of what that says, so if I take a look at my percentage of women, and how much that has changed, alone: if you take a look at the percentage of women now in my organisation, on £60,000+ for example, that’s 8%, but that has gone up quite dramatically from the year before. If you look at £30,000 to £60,000 that is now 28%. Below £30,000 is 50% of women in my organisation, but if you then say, “how much has that really switched in the last three years?” it has changed. It has actually changed on race as well; on age, as well. Disability is a tougher one in my workplace, and actually how we challenge those specific challenges around disability, and what we can do to make our workplace more accommodating on disability, but I think we’re seeing some positive trends. However, I think you have to look at it over a five-year period. We’ve started to do this over the last couple. What I have been impressed by is how many of my people have commented on just how useful they have found the training. They don’t always find training that useful; it is very, very good.

Thérèse Coffey: I think we’re going to recommend it in our Parliamentary party, aren’t we?

Mary Macleod: Yes.

Ruby McGregor-Smith: As part of the Women’s Business Council recommendations, there’s going to be a whole piece around women starting out, enterprise, and other issues, and a lot of these issues will be wrapped up in those recommendations, on which we can give you a more detailed briefing. I think we can give you a briefing on the initial recommendations already, but actually, I think it would help.

Thérèse Coffey: Yes.

Q211 Mary Macleod: That was really interesting. One of the things that Heather McGregor talked about, when you were talking about retention, was the gaps in a woman’s CV, which if you’re looking for someone at board level, given that she’s a headhunter, it can become a real issue. Are there things we can do more to support women? We talked about childcare; but things to reduce that gap, or keep them involved in some way, so that they don’t have big gaps in their CVs if they do take a bit of time out.

Ruby McGregor-Smith: I think part of it is psychology. I don’t really understand when headhunters talk about how you’ve got to have public company experience to be a public company director: says who? In my company my chairman put me on a public company board in 2002, and I hadn’t been on a public company board before. Yes, I’d been Senior Finance Director at a previous organisation. I’d had a two-year gap on my CV, and his attitude was quite simple: “We will help support you to understand what you don’t understand to do the public company director bit. It’s not that hard.” I think actually companies need to get over that: yes, there’s a lot to do, but you don’t need it. When we look at people, we haven’t got currently any executive positions on our board that are vacant, but when we look at talent pipeline, even around our non-execs, there is no guarantee that my board and I will even be that remotely bothered if they have been on a public company board before. That is us, though. Other organisations need to change. I don’t think it is relevant.

Q212 Mary Macleod: Is there any sort of final comment you want to make? You’ve mentioned potentially what you would say to the Chancellor. Is there anything else that you would say that

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government needs to do, or what your message to business would be, or perhaps even just to women, in terms of what they need to do to try to get an improvement in that pipeline?

Ruby McGregor-Smith: I think what you have to do, more than anything: if you’re an aspirational woman in business, you need to make sure you’ve got the right mix of talent and skill, if you want to run a business, to run it. It means you’ve got to focus very carefully in your operational experience on different roles you need to do to make you more rounded. There is no point just being an accountant or just being a marketing individual. You’ve got to be a rounded individual to run a business. You’ve got to understand people. Most organisations today – bigger ones – will help you with that plan, and actually will support you if you’re part of their talent population, to say, “how can we actually make sure that you have the skills and attributes needed?” That’s because actually organisations don’t always want to go and hire from outside; they want to develop their own talent. It is, to me, always a disappointment when we have to go outside to hire people because we haven’t actually promoted our own talent and actually nurtured our own talent. Every organisation should be able to do that.

Q213 Thérèse Coffey: It creates frustration for those who are not promoted.

Ruby McGregor-Smith: Well, absolutely, and I think that you’ve got to cut that anyway, so that’s one big message on aspirations for women: get the rounded experience, and actually be prepared to change roles. Don’t, for goodness sake, sit in one role for 10 years and wonder why you didn’t develop. Move around. That’s scary, but certainly when I look at CVs, what I recognise is those who are prepared to go and learn, and those who are really hungry and really driven to do more with their work. I think, you know, we don’t always see that; you don’t always see that in any part of a population that you’re interviewing. We look at graduates: a typical example. We get over 1,000 applicants for our graduate scheme which has 5 people in it. What makes us decide when they’ve all got a 2:1 or a first from a fantastic university? Drive: what did they do that was different? What makes them decide they could succeed? If they really want to run one of our businesses one day, what makes us believe they’ve got the ability? Actually, it’s the drive, and it’s the different things they tried to do. I think that’s what impresses you about CVs. Tick-box CVs are out. Developing talent is a complicated issue in itself. My big plea, more than anything, is if we’re serious about raising aspirations of young people, we must think about careers advice, and think differently about getting businesses more involved in that. I don’t think what comes out of university, and what comes out of school, is always fit for business. Therefore, I spend my first year with our graduates helping them understand what they need to do in business, so why can’t we just get some of that done in our education system? It’s interpersonal skills that matter. For women, the ones that get over the confidence issues; the ones that get brave on presenting, who begin to try and do different things and break, get through their worries: they’re the ones that really impress us.

Mary Macleod: Brilliant. Thank you so much, and can I just say thank you also for the work you do for the Women’s Business Council? I’ve been fighting in Parliamentary Questions to get enterprise being taught in schools. I haven’t achieved it yet.

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N. James Charrington, Senior MD & Chairman EMEA, BlackRock Inc. Dr Nigel Wilson, CEO, Legal & General Group PLC

Mary Macleod: That’s brilliant. We’ll just introduce ourselves. I’m Mary Macleod. I’m an MP in West London for Brentford and Isleworth. I chair the All-Party Parliamentary Group for Women in Parliament. I’m also Parliamentary Secretary to the Secretary of State for DCMS and Minister for Women and Equalities, and I spent 20 years in business. I did work for a little while with Accenture at Legal & General.

Thérèse Coffey: I’m Thérèse Coffey. I’m MP for Suffolk Coastal. I am currently PPS to Michael Fallon, the Trade Minister. Before joining Parliament, I worked for a short time for the BBC. Before that, I worked for 12 years for Mars, who make Mars bars and things like that, so still a private company.

Cheryl Gillan: I’m Cheryl Gillan; I’m the longest-serving woman on the Conservative benches. I have just come out of the Cabinet, but I used to work in the real world before I came into this place. I started life in law, but I worked for Mark McCormack for many years, IMG in sports, as a marketing director and the director of an insurance company and so on.

Q214 Mary Macleod: Thank you very much indeed. What we’re trying to do with our enquiry is to supplement and support the work that is already done, because Lord Davis, of course, has been doing work about women in the boardroom and there has been progress made in non-exec directorships, and getting more women through to the top from a non-executive angle, and also the BIS Select Committee are currently doing work about women in the workplace, so a lot is going on, and the 30% Club and various others are doing great work. There was one area where we felt it just needed slightly more focus, and that was about executive women in the workplace and trying to get the executive pipeline sorted so that women are getting through the board on the executive pipeline. What we wanted to do is pull together, speak to people like yourselves, so we can pull together ideas and thoughts on if there are things, potentially, that government needs to do, or if not, is it highlighting things that business perhaps needs to do. It’s always good, of course, to get the male perspective on things too, so thank you very much for being here today, and I promise to try to get you out on time at about 11 o’clock. So you might want to make sort of opening statements in terms of where you feel some of the issues are on diversity, or what progress you have seen yourselves.

James Charrington: Shall I start? My name begins with C. I think progress is being made, and I think mainly because there’s a better understanding and a deeper understanding of diversity. I think my initial interactions and thoughts around it were shaped by: we’ve got to get more women in the workplace; we’ve got to get to a number here and a number there. I feel quotas are absolutely not the way to go. I think we have got to help people understand what a diverse workforce actually brings us, and in very simple terms, our clients are men and women from all sorts of different parts of the world: different upbringings or whatever. We have a diverse client base. If you look at society generally, it’s diverse; it’s made up the way that it is. So if you have a business that is operating in the world and connecting with all sorts of – a representation of society, if it’s not made up itself in a way that reflects that, somehow you’re going to start to think: “Well, am I actually making the right connection? Am I connecting up in the right way with my client base?” I think trying to establish why it’s important, why it’s valuable, what it brings to an organisation by having a diverse workplace actually is getting the debate to a much better place, rather than having the idea that somebody is saying somewhere that we’ve got to get more women in here

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and more women in senior positions and that we’re somehow trying to tick a box. That is actually a very bad road to go down and will not serve diversity, in all its shapes and forms, well. I feel we are getting to a much more constructive place and understanding now that will have a better chance of delivering where we all want to get to.

Q215 Mary Macleod: Thank you. Nigel?

Nigel Wilson: I’m the father of five daughters.

Mary Macleod: Lucky you. [Laughter]

James Charrington: You can have a couple of my sons if you like.

Nigel Wilson: It’s always been a house of many women – and many of them are in the workplace now, so I’ve got first-hand experience –

Mary Macleod: I bet that is expensive.

Nigel Wilson: Yes, it is. [Laughter] There are four attributes in life that drive success: ability, application, attitude and ambition. I think too many women in senior positions: take headmistresses and teachers in schools and enterprise – they just focus on the first three. I have had a lot of dealing with headmistresses in my life, and you need that funnel. You were talking about it: how you move up the leadership ladder. Too many people get happy with good ‘A’ Level grades, and somehow the headmistress, the school, the parents, the individuals, the girls themselves, feel happy that they have got three As or two As and a B and that they have gone off to a nice university. There isn’t really corporate ambition starting at a very early age, whereas boys tend to have more corporate ambition. Many headmasters dream of and aspire that their students become industry leaders, or Prime Ministers even. You can think of the best public school in Britain as being a prime example of that on the men’s side. Some of the best girls’ public schools – some of which my children have been to – just don’t have that same level of ambition. It’s very hard to convince the headmistress that the goal isn’t just to get two As and a B, or three As, or whatever, and go off. That’s not the goal; the goal is a very long-term goal, and women have to think along those – lines there is a pyramid that they are going to go to in work, and they should work their way up that pyramid and have ambition to get up that pyramid. On a deeply personal level, I feel very proud of the organisation we work for, because I feel we are doing a huge amount to promote women in the workplace, in part because of enlightened self-interest: many of our most talented people have been, and continue to be, women. Over a long period of time, they have not forced their way through to the upper levels of two very traditional industries: fund management, which has been dominated by men, and the actuarial profession, which also has been dominated by men. If I reel off statistics now, of our ExCo, and it’s ExCos that matter, I know there’s a lot of talk about non-executives on the board and all the flag-waving, and it’s great that that’s happening, but actually, the power sits in the ExCos, we have 5 women out of 12 on our ExCo which is a huge proportion. Of our Future Leaders programme, which is sub-ExCo, 9 of 14 are now women. We’ve never had that ratio before, and that’s not because we have deliberately done it: we’ve actually just worked really, really hard to encourage people to be ambitious and push themselves forward, because when I talk to my fellow Chief Executives, or the guys who run the professional services firms, like PWC and Clifford Chance, we’ve got the entrance level right. We have 50/50 talent at the entrance level, but they drift away as they go through, and that is a huge waste of resource.

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It’s not just about equality; it’s actually about performance and resources. We are underachieving as an economy because we don’t get the right person for the right job, who may be a woman who doesn’t always put themselves forward. There isn’t that critical peer-group pressure you get as a man to actually perform and aspire to perform to be at the highest level.

Q216 Mary Macleod: Are these numbers, that you’ve got there, replicated at every level throughout, if you go further down the organisation?

Nigel Wilson: Yes.

Q217 Mary Macleod: What are you doing right, then, that many other organisations aren’t doing?

Nigel Wilson: I think a lot of organisations are now making progress around this. We are the biggest shareholder in PLCs in the UK. We own around 5% of every PLC in the country, so it’s quite an influential position to have. We’re very pro-active across a wide range of diversity issues, as BlackRock are, and women are a very important part of that. That communication spilling out; in a sense, you’re betting on a winning team here. It’s just a case of accelerating the processes that have begun in a much more constructive and ambitious way, but working on all levels of the pyramid, not only the non-executive bit over here, which is, in some ways, the easiest bit to fill. People shouldn’t be complacent. That actually is the goal; it is those others cascading down, at the graduate level entry. We want as many women as men, but we want them to be as ambitious as the men when they have finished their graduate entry programmes, and we’re getting there. There’s nothing that stops us doing it. There are no barriers stopping us from doing it. The only aspect of it is this ambition and we’ve just got to get back to that ambition and really push people to become ambitious. The other thing we’ve just set up –

Q218 Mary Macleod: Sorry to interrupt again. Do you think women are less ambitious, or do you think that they assume that because they do take career breaks to have children, etc., they assume they can’t be as ambitious as men? What’s the issue there?

Nigel Wilson: I think they are less ambitious, and I think it is one of these elephant in the room type of things. If you do a poll, you will find – and I’ve had many polls of this over my life with all my children – is that boys, on average, tend to be more ambitious. They have a future view of where their career is going. Whether that’s because people are thinking about career breaks, or not, I wouldn’t know empirically whether that’s true or not, but certainly there is less ambition. You have to nudge women to apply for promotions. There’s nothing wrong with nudging, and I decided many years ago that nudging is quite a good idea. It’s a trendy word now, but I always – just to nudge, and to say, “actually, give it ago, because even going through the process you will pick up skills which are required to win next time, even if you don’t win it this time. Don’t feel bad about not getting the job this time, but to go through the process.”

James Charrington: I think this ambition point is a really interesting one, because we empower everyone in a senior position to build a succession plan, and a succession plan isn’t about one person: it can’t be. It’s around a number of people, and I had a conversation with someone the other day who is in the succession plan for my role. I was quite struck by how surprised she was that I was looking at her as a potential candidate. I wanted her to be aware of that, and we wanted to do some things to help her develop so she becomes a serious candidate. I was quite struck by how surprised she was that people might be looking at her. I think the point that you

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raise is a very good one: through school, and maybe even in the family, before school, I think there is a tendency that boys are being taught about the world out there that they can go and conquer. Are girls being talked to in the same way? Ambition isn’t burning within them from a very early age. The whole question of diversity is at the point you start. I think the non-executive piece is really easy, because you could drop people down who already have a credible career and they have been an achiever and a success. If you want to create diversity on your non-executive board, you can do that quite easily. I think the numbers there are all pretty encouraging. It’s this point of coming up through an organisation, and that sense of self-belief, that we have to do more, but earlier. I think we’re doing a huge amount in the organisation to identify future leaders, both men and women, but we have specific programmes for women that are designed to help them further their aspirations and ambitions, if you like, which is a year-long –

Nigel Wilson: It does start at school; it really does start at school, and you have to get the headmistresses. It’s often the headmistresses. I happen to be a very good athlete; I have taught at school, voluntarily, athletics. They never ever want me to come in and present to the children. I’m Chief Executive and I have a glittering career in business but they just will not – because some of my views are too controversial for them, and they think I am too pushy; I’m a pushy parent. It’s wrong; I take the children out, and I train them up for athletics and stuff, and they are very comfortable with that, but that I should come in and speak, which I do virtually every day in our organisation to mixed groups –

Q219 Mary Macleod: You’ve offered it and they’ve never taken it up?

Nigel Wilson: They never take me up on it, because I have such strong views on things that should get taught at school, as well; particularly in the enterprise area. Universities are the same; universities are dreadful, in Britain, for producing people for our businesses. I am sure you’ve got exactly the same problem. Our graduate recruits: we have to retrain them all and train them up because there’s virtually nothing that they are being taught at university now that’s of value to us in the business place. So we’re all thinking about whether we just dis-intermediate in different shapes or forms; have our own special courses at university or take people before they go to university. That applies to both genders; equally so to women, but there is this lack of linkage between our education institutions and commerce. Women have skewed in that, in that this ambition gene, or whatever you want to call it, isn’t promoted enough in schools. If I look at who speaks in some of the great schools in Britain, they have fantastic speaking programmes. In fact, I’d like to sign up to some of them myself and go and listen, but the girls’ schools don’t do that in any way, shape or form; they are fantastic academically now, and when you look at the grades and how they are doing, it’s fantastic academically. However, that commercial gene, that ambition gene, is not pushed anywhere near hard enough. BlackRock is doing a fantastic job; we’re doing a fantastic job. Lots of companies are doing really good jobs, and we’re going to start promoting it a lot more that we’re doing it. We’ve set up our own women’s network now, where we finally told them that there is a sufficient mass of really, really talented people. You’ve got to come together and work as a group and cascade a lot of the mentoring down across the organisation, because we need more women mentors of women really to encourage people to fulfil their potential.

James Charrington: I think also there’s a tendency for women’s issues to be put over here and thought about by women thinking about women; our women’s – we call it the WIN group in the office – they came to me about 18 months ago and said, “it’s not quite doing what we need it to do.” I said, “how many men are a member of WIN?” Zero. I said, “you’ve got to get men into that group,” because actually, if it’s just women talking about women’s issues, men will feel

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marginalised about it, but they actually have something to contribute to that discussion. So I think there’s a danger that these things are looked at in isolation; I think women should mentor women, but men should mentor women, and it’s a question of getting the right mentor with the right person that gives them the best of what they need.

Thérèse Coffey: By the way, we have men in our forum as well.

James Charrington: I was going to make an observation at the end that –

Mary Macleod: One is just off on parental leave at the moment.

James Charrington: Okay, but that’s a good thing; I think there’s a danger that if it wasn’t, then are you getting all the different sorts of perspectives that you need to get?

Nigel Wilson: Women don’t ask for pay increases as often as men do: just fact, over thousands and thousands –

Mary Macleod: Sorry, what was that?

Nigel Wilson: Pay increases. Women never ask for pay increases. They feel slightly more embarrassed about doing it, and they don’t ask for promotions as often. I do hundreds of reviews a year and have done for 25, 30 years. There are thousands of data points on this. It’s very rare that a women comes in and slams the table, and you get that every time with a great theatre around it with men – [Laughter].

James Charrington: However, the ones that do want the pay increases and promotion, you’re in no uncertain terms – [Laughter].

Q220 Cheryl Gillan: Let me tell you; if you do that, the men are described as forceful, in command, and wanting to get ahead. The women are described as hysterical, and quite untrustworthy, and, “we’re not quite sure we want to deal with her.”

Nigel Wilson: I don’t agree with that. I fundamentally do not agree with that. I think enlightened managers want people to be ambitious. Whether they behave in a way you may not traditionally associate with women, I am quite happy with that, and I think the modern, enlightened manager doesn’t have in mind that stereotypical picture.

Cheryl Gillan: Don’t forget I have been in here for 20 years, so… [Laughter]

Nigel Wilson: That doesn’t happen in modern, enlightened companies. If I talk to Ginni Rometty, who runs IBM, and has got 420,000 people, they have got plenty of pushy women in that organisation, and plenty of pushy men. They’re very enlightened. I was in Tata in India the other day. All the senior people I met out there were all women in their organisation. Some companies have fundamentally changed already around it, and there is much more meritocracy going on in –

Q221 Cheryl Gillan: I don’t disagree with you; I think I agree with a lot of what you’re saying, and I have even seen a women running a blast furnace at Tata, so I can endorse that, but I just think

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neither of you are hitting on something which I observe, which is that women have a different operating style. Even in enlightened management terms, and you may not agree with me, but I would like to know your opinion, I think that a lot of people don’t recognise that a female operating style in the workplace is often very, very different to those of the men. People that may not seem overtly ambitious to you, or ambitious presenting themselves in the same way as the men do, are in fact exceedingly ambitious but they just go about it in a different way. I notice the dynamics of groups in which perhaps I am the only women, which has happened to me a lot: I am only the sixth women in the Conservative Party to ever serve at Cabinet level.

Nigel Wilson: Isn’t that shocking for the Conservative party?

Cheryl Gillan: Isn’t that shocking? I agree with you.

Nigel Wilson: The Conservative party representation of women in politics is the same as Azerbaijan and Libya.

James Charrington: Having had a woman Prime Minister.

Q222 Cheryl Gillan: Exactly, but she was only number two. For me, that’s what I find so frustrating, because I don’t think people find that the operating style of women suits what they see as being the ambitious, thrusting, wanting-to-get-on type of person.

Nigel Wilson: We’ve got fund managers and actuaries – let me tell you, they are naturally quite introverted individuals, a lot of these people. They are highly technical; most of them have fantastic degrees, so that sort of stereotypical thrusting sort of person isn’t really part of our – they’re very reflective, considered, analytical individuals in our organisation. I’m sure BlackRock is the same. There’s a sub section of our group. But I wouldn’t recognise the difference in operating styles of men and women in our organisation. Our fiercest negotiator, who does all the IBM contracts and the TCS contracts, is a woman. I get to play good cop in those meetings. It’s not very often that I get to play good cop; I am usually the bad cop, but in that one I get to play good cop. Three of our four top actuaries – top actuaries – are women, and they are regarded entirely as the best actuaries that we have in the group. 20 years ago, you would have had to go a long way down our organisation even to find women actuaries, because it was such a male-dominated profession. The world is changing, and it is about nudging in organisations. Some organisations aren’t doing it very well, and so I am very proud of what Legal & General has achieved so far, but we’re still on this journey. We’ve got this pyramid; we’re getting everybody through it. We haven’t yet broken through to the top level, but ExCo is fine and the Future Leaders programme is fine.

James Charrington: I think the other thing I would say is that we certainly don’t identify particular roles in the organisation as being, “a woman is ideal for that role,” or, “a man is ideal for that role.” I can look at all roles, whether it’s fund management teams or whether it’s the HR function or whether it’s business operations or business leadership in some form or other, is – we can have a woman in that role and then it’s followed by a man or a woman. It’s the best person for the role. I do sometimes see different operating styles, but you get the benefit of those by – I think the earlier point that I made is that that is a natural reflection of society, that men and women are in the decision-making process, whether that’s in the family, or more generally. We certainly don’t have roles earmarked for men or women. That, I think, is positive: we see people coming through from both sides, and the best one gets there.

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Mary Macleod: Yes, and I must admit I do agree with your comments about asking for pay and promotion, because I probably fall into that category of working in financial services and not asking often enough for payment or promotion, and it was a man who nudged me – who said to me, “how about you go into politics? You’d make a great MP.” I hadn’t thought of it, so I have got a man to thank for that.

Q223 Thérèse Coffey: I’d kind of like to go down a different angle; it’s very interesting to hear the internal experiences. Both of your companies are basically big investors in other companies. I know it’s not your only business in L&G, but fundamentally, BlackRock is about fund management.

James Charrington: Totally; yes, that’s what we do.

Q224 Thérèse Coffey: So one of the things we’ve been looking at is that the original Cranfield research, I thought, was a bit patchy about trying to show that having a greater proportion of female executives meant that a business could do better; you know, there’s a good link to performance. The more recent work by McKinsey is better at showing that. Is it something that you think just never comes up in fund managers’ minds? Ruby McGregor-Smith was saying earlier: they will start sometimes to ask about talent coming through, but is there a conscious thing about: what are you doing to ensure you have the best talent, whether it’s black, women, men, disabled? Is that part of a fund manager’s mind-set?

James Charrington: Very much so; we have a whole area that focuses on the governance of the organisation; we’re the biggest shareholder in the world, so we’re engaging with companies. I think your last guest’s reference was one side of the engagement between a fund manager and the management of a company; she described a 20-minute meeting where the focus is on earnings per share and things like that. The dialogue with management of companies is much broader than that. Sure, sometimes there are 20-minute quick update meetings where you want to focus on those sorts of issues, but we have a whole area devoted to this where we engage with companies on a very meaningful basis around their governance structure, and diversity in all its forms is one of those. We want to know how companies think about that, and you get a sort of sense of what their agenda is, and I think there is no question: the agenda is moving forward. However, there are still some companies that look at it as a tick-box exercise, and we have a view to expressing that. Not that we want to get them to a quota. That’s not what we want to drive. We just want to get them to think about it more broadly, and in many ways share, I think, our enlightenment around it, because we can point to all sorts of examples of where it has been beneficial to our organisation. BlackRock was formed 25 years ago by 8 partners, 3 of whom were women. We have never had an issue about this, and we’re a much bigger firm now, and they are all still with the firm, I should add. I’d like to feel one of the reasons why we have been so successful as we have over such a short period of time is that we have embraced those; maybe not thinking about it, but unwittingly having that diverse group around the table discussing how we took the business forward actually helped us do that. We feel in a very good position to engage with companies. It’s not for us to tell companies how they should run themselves; we have views which we will express to them, and we will share our experiences of why we think it’s a good thing, and what it can deliver to them as an organisation, and we monitor that as we go forward. The ultimate judgement we make about a company on a whole range of things, one of which will be its governance, and how diverse the management group is, will determine whether we’re a shareholder or not, or a small one, or a big one.

Nigel Wilson: We’re slightly different, because we are primarily a passive fund. We have got 400 billion of funds under management, which is quite a lot, in the UK and we’re the biggest

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shareholder, with BlackRock, in the world. We take a slightly more proactive position in general, in that we’ve had 425 meetings last year in corporate governance; just over 300 raised the issue of diversity and women. We have written, now, to several of – most of the FTSE 100 we’ve had some engagement with, and the direction of travel is broadly okay with the FTSE 100. Mervyn’s done a very good job, and I’ve had a couple of meetings with Mervyn, who is a good friend of mine. The FTSE 250, however, is shocking, and we’ve joined with a few other shareholders and written formally to several FTSE 250 companies, and told them it is just totally unacceptable to have no women representation on your boards. We just think that, as a business position, is wrong. In terms of McKinsey, I used to work for McKinsey, so I am slightly prejudiced. [Laughter] I did think it was a better quality piece of research as well. There is this critical mass; I was talking about it earlier. If you are an isolated female, which often you are, it’s difficult: there are a number of people. It is hard, and it has been hard for my children in certain circumstances; it’s been hard for colleagues, and we try to recognise that, but often there is a minority. As we get to the critical mass, that capability to deliver against getting the best people in the right job just goes up; you see that in BlackRock, and we see it in our organisations, but we will vote against the nomination committees who do not have appropriate representations.

Q225 Thérèse Coffey: Okay. That’s interesting. So you’ve made that declaration?

Nigel Wilson: We are making that declaration, because last year was on remuneration, and we had a global strategy around all of that where we feel certain executive salaries just got completely out of line, so because we’re predominantly an index fund, we have to hold the shares in that company. We can’t sell them, because that’s what we do, so we have to take a very proactive position.

Thérèse Coffey: That’s interesting.

Nigel Wilson: Therefore, we can’t go in and say, “we’re going to sell the shares if you don’t do this.” We go in and say, “if you do not do this, we will vote against it, because that, we think, is the right way for certain aspects of companies to be run.” Not in the selection of individuals or whatever, although we have had various meetings with headhunters about this already; when they’re drawing up lists and they come and talk to us about senior appointments, we would like to review those lists with them and make sure there’s a fair representation, a diverse representation – not just women. In big picture terms, we think diversity, like BlackRock, is a very good thing to have. The UK economy is very unproductive at the moment. It’s not growing; lots of things. One of the things we need to do to fix it is promote more women across the board; for them to become a more efficient operator within UK plc., and we’ve taken that on at a very senior level. Having five daughters, I expect I am slightly biased in my thinking about the capability of women and the underachievement in the corporate world we have seen for a long period of time for all sorts of different reasons. However, we will vote in a very proactive way to encourage boards to take on what we think is the right thing for them to do.

Q226 Thérèse Coffey: That’s a change in stance since when? Has that evolved in the last five years?

Nigel Wilson: It’s shorter than that; I think the remuneration, we worked very closely with BlackRock last year on remuneration, and the shareholders as a collective group, of which we’re the two biggest in the UK, have decided that there are some issues on which we should just act collectively, because this is already becoming the next issue, and we’ve got two other shareholders.

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Q227 Mary Macleod: Is there general agreement across investors to do that?

Nigel Wilson: There is increasing agreement. We have sent out our first 10 letters, and 3 shareholder groups have signed it, and the other 2 are quite sizeable shareholder groups as well, and at a number of meetings on RemCom last year, there was a lot of voting by shareholders against remuneration.

James Charrington: I think there’s no question. I think the industry as a whole is beginning to be a very effective and powerful lobby. I think there is a lot of common ground between us on the sort of key issues; clearly compensation was the big question last year. We’re slightly different organisations; your assets are passive, and we run both passive and active, but our passive shareholdings are voted in line with our active shareholdings, so we’re not sort of voting against each other, if you like: we have a very strong view which we express for every dollar we have in a company.

Q228 Thérèse Coffey: So BlackRock is a global business; you run Europe, a very important part of it. How are you evolving...

Nigel Wilson: We’re also a global business, by the way. [Laughter]

Thérèse Coffey: Sorry. I do apologise.

James Charrington: We’ve probably – we maybe feel your headquarters in the UK, we’re headquartered in New York, which maybe makes us think that one is more global than the other, but we are both global organisations. We think about these issues very much as one organisation; our policies around diversity, on how we work with organisations, how we may vote, is globally coordinated. At the end of the day, I think this comes down to the culture of an organisation. You can’t have one culture here and one culture here. It may be reflected slightly differently in certain ways because there are different cultural nuances around the world, but essentially there’s one culture within BlackRock, and we think and work as one in terms of how we think about these sorts of issues.

Q229 Mary Macleod: I think that’s really positive to hear: what investors are doing, and also if they are acting more collectively on it, because I think if you are speaking with one voice it’s much more powerful, and it’s consistent, and hopefully something will happen, because I just think –

Nigel Wilson: We publish our votes on our website now, as well, so there isn’t any –

Mary Macleod: It’s transparent.

Nigel Wilson: We do it a month after we vote, to minimise newspaper headlines, although that doesn’t work that successfully.

James Charrington: There’s a responsibility that we have to undertake not to disrupt –

Q230 Mary Macleod: Yes, because we’ve talked about this issue. I mean, I have been in business 20 years. We have talked about this for a long time, and I just feel now that there seems to be –

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whether it’s started off perhaps with some of what Lord Davis was doing, but it’s certainly – there seems to be much more movement behind it now, where we are saying, “actually, for economic growth, we need to have talent right throughout our organisations,” retaining that talent, and making them contribute to the overall organisation. I guess there are responsibilities for investors; there’s a responsibility for businesses themselves. Are there things you think that government need to do as part of this process?

Nigel Wilson: Well, I think Vince Cable has been pretty proactive himself around it.

Thérèse Coffey: He did something today.

Nigel Wilson: Again, today, and we see him many times on many levels. He coordinates a lot of our communications with shareholders alongside Vince, but why I am proud to work for organisation is that we’re actually delivering on everything we say we’re going to do, and it’s very visible when you walk around the workplace. That isn’t as visible in lots of other places, and lots of other people have yet to go on this journey, but it is massively important for UK plc that we get it right, because other parts of the word, by the way, have got it right. If we take as an example the Tata group, and places like that, they are ahead of us even though people’s perception is that they are behind us, and that’s just not true. The UK has to move up the curve as we are a relatively poor performer on pretty much every international metric on this particular issue, including, I daresay, the Conservative Party itself. Therefore, we need wholesale change, but the timing is perfect; the timing is perfect to get this done, but it has to be endorsed by the leaders of the party; both David and George. It isn’t the only issue; we’ve talked about disabled people and what we do in the workplace. Ed Miliband came into our office; we’re co-sponsoring work on mental health and stress in the workplace with Ed, and he has been very proactive on what is a really difficult issue. We have had round tables like this where people were discussing how, as an enlightened employer, and as an individual within a workplace, you can deal with mental health. Diversity and women is an easier issue in many ways to solve, but actually, apart from Vince, there aren’t lots and lots of other people out there at a very visible level.

Mary Macleod: Talking about gender balance.

Thérèse Coffey: I guess it’s his domain formally.

Nigel Wilson: Yes; you can say it’s X-domain or Y-domain in our company, but it’s actually all of the board, and John Stewart, who is our chairman, is a big champion of this.

Mary Macleod: Yes; good point.

Nigel Wilson: I gave a speech at the Bank of England a few weeks ago to all the FTSE chairmen on what our position is and what we’re doing about it, just again about visible communication, and what we would do as a major shareholder to companies who we thought were not doing the right thing.

Q231 Mary Macleod: Because perhaps if everyone in the board is talking about it, or all the Cabinet are talking about it, then it embeds throughout the organisation; driving through.

James Charrington: Yes, that’s absolutely right, and leadership is an important part of that. I think in terms of the Government’s role, clearly there is a gap. There is a role for Government, and I think

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the Government should behave and reflect in the way it’s organised and structured in a way that sets a role model, if you like. However, we shouldn’t look to Government and say, “well, they need to think it out, so we’ll decide what to do.” We all need to be thinking about this ourselves; that is our responsibility as business leaders, and indeed other business leaders. What we’re trying to do is the right thing for our organisation, and the right thing for our employees and shareholders as well, but we’re both big firms. We want to be role models, as well; I think the Government should see its role partly as a role model, but also helping where it can in terms of legislation to help move this along.

Nigel Wilson: We don’t want to lose talented people, and this idea that somehow women will get lost from the workplace when they have had children; we don’t want to do that, so we will create flexible working hours; home-working; three-day, four-day contracts; whatever it takes to retain our most talented people. That’s part of the ethics and this enlightened self-interest that we’ve probably both got as organisations, so we don’t want the person that’s making £70,000 a year, and whom we think is a future star, to disappear off for a few years, unless they want to do it by choice, which is a natural thing for people to do as well, but we will design schemes to encourage these people so we don’t lose them out of it. We’re not that bothered if people have two years missing from their CV or anything like that. In fact, I would encourage both men and women to take a couple of years off if that is what they want to do, and tour the world, and do whatever. I don’t often say, “oh by the way, I noticed you didn’t work between 1995 and 1997.” It’s sort of ridiculous to think that that stops people being hired or promoted.

Q232 Cheryl Gillan: Can I just take you back to something you said at the beginning about headmistresses and ambition? I used to be Schools Minister, but also, I had a very ambitious headmistress called Miss Treadgold at Cheltenham Ladies’ College, and then Margaret Hampshire came out of ICI into education, and between those two women and my father, who told me that I could do anything and go anywhere and be anybody, and that I was both his son and his daughter, I think I had a pretty good start in life. We’ve just had Vicky Tuck leave as headmistress of Cheltenham to go off to Switzerland, and there was a very high-profile piece of export – we’ve exported the headmistress of Roedean to Switzerland because she said there’s a hostile environment to what she wants to do. Do you think government should be doing more to get those heads focused more on business and industry?

Nigel Wilson: I totally agree with you, and Cheltenham Ladies’ College is a very good example of a very ambitious school.

Cheryl Gillan: I was the first MP from there.

Nigel Wilson: It’s staggering, isn’t it?

Cheryl Gillan: I know, there are now four.

James Charrington: It comes to the point where – it needs to start right at the beginning, not halfway through.

Nigel Wilson: That programme getting people out into the schools; not just – you know, we’re very good at getting a local football team to go round, and that sort of thing. It’s ironic that footballers engage a lot with the schools, but it’s always harder to do business-type stuff. We’ve got numerous mentoring programmes; we’re handing out our CSR awards. I have no idea how some of our people

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– in fact, I don’t know what their day job must be, because it’s crazy how much stuff they were doing outside, but there is a huge latent demand for this. It’s not just girls’ schools; I think a lot of boys’ schools are very poorly tuned-in to what’s going on in the corporate world. Part of that is the teachers’ own backgrounds don’t leave them very well-prepared to give them good advice and ambition.

James Charrington: Boys benefit from hearing from female corporate leaders. I mean, again –

Q233 Mary Macleod: I think part of that is also helping them understand what choices to make, so we were saying earlier girls should be studying more maths, and we don’t have enough of them doing that.

Nigel Wilson: All my children had to do higher-level maths, because I know in business you just need communication skills and maths is just such an important part of the modern world now.

Q234 Cheryl Gillan: But one of the things when we were doing the specialist school programme in John Major’s Government, and even now with academies and everything else, is to try to get businesses involved in schools so that they would influence what was happening in those schools. I don’t know whether I have got any experience of that, with your backgrounds, but it obviously is not happening enough, so you are actually – you have your manufacturing unit producing something which isn’t fit for the market.

Nigel Wilson: Purpose. And at universities – universities are the same. We just find the graduates are out-of-touch with what is going on in the modern world, and therefore we’re not producing the right –

Q235 Cheryl Gillan: So if there’s one top-down driven thing Government could do to improve that connection, what would you suggest?

Nigel Wilson: I think linkages between Governments, the corporate world, universities and schools – it’s just got to be explored. KPMG’s linkages they have with the three universities are fantastic. PWC has one university that they have a strong linkage with, so there’s a bit of proactiveness going on, but you need a huge amount more of that. We don’t get nearly enough trained people.

James Charrington: There are many ways in which the curriculum could prepare people for life.

Nigel Wilson: I totally agree. I would think of a few things like ethics and morals, or presentation skills, or enterprise.

Q236 Thérèse Coffey: One of the things we’ve been talking about with a number of witnesses is the idea of companies reporting their gender numbers down, say, three levels from the board. What would you think about that, and would investors look at that if it was published?

Nigel Wilson: Well, we do it anyway but others won’t. The non-exec targets are a good start but in themselves they aren’t sufficient. So yes, I think it would be a good step.

James Charrington: Yes I agree.

Mary Macleod: Well can I just thank both of you for coming today, we appreciate you giving up your busy time and it’s been really interesting. So thank you.

93 Executive Women in the Workplace Inquiry Corrected Oral Evidence- Session 4 Thursday 31st January 2013

Members Present: Mary Macleod MP (Chair) Amber Rudd MP Andrea Leadsom MP Dr Thérèse Coffey MP (start-Q265)

Witnesses: Helena Morrissey CBE, Founder, 30% Club; CEO, Newton Investment Management Amanda Mackenzie, Chief Marketing and Communications Officer, Aviva PLC Peninah Thomson OBE, CEO, Mentoring Foundation Dr Emily Lawson, Partner & Co-author of Women Matter series, McKinsey & Co.. Ama Afrifa-Kyei, Advisor, Employee Engagement, Diversity & Inclusion, Deloitte LLP Louise Brett, Partner, Consulting, Deloitte LLP Evidence:

Helena Morrissey CBE, Founder, 30% Club; CEO, Newton Investment Management Amanda Mackenzie, Chief Marketing and Communications Officer, Aviva PLC

Mary Macleod: I think what we’ll do is we’ll just start because I know your time is precious and we’ll certainly feedback to the others. Harriett unfortunately has had to go into another Bill Committee, so we’ll get started and Thérèse and Andrea will join us too. So thank you very much for coming to join us today. What we’re doing here is – you as part of the 30% Club, or having founded the 30% Club, have done a huge amount of work on this, and thank you for all that you’ve done. I guess what we wanted to do was to support that, and also build on what Lord Davies is doing at the same time, because I think it’s very recognised now in business and industry that we are moving, although probably not as fast as many of us would like. But there has been change and I’m absolutely convinced that’s the sort of pressure that organisations like 30% Club have helped drive that through and helped deliver that. So thank you for all of that. One of the areas that we’re looking at given that a lot of the progress has been made on non-executives in the board room, is the executive pipeline. Welcome. I’m just doing the intro preamble.

Amanda Mackenzie: It took an hour and ten minutes to get from King’s Cross, I’m so sorry.

Mary Macleod: Anyway I was just saying we’re trying to build on all the great work that Lord Davies and the 30% Club are doing, and we were concerned about the executive pipeline. I guess what we were trying to do is say, “is there anything else that government should be doing or is there anything else we should be doing to highlight some of the issues that are out there and help with the communication and progressing this along?” So that’s why we’ve done this enquiry into the executive women in the workplace and executive pipeline and it really also builds on work that

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the select committee are also doing. So thank you for coming to join us, perhaps if we all introduce ourselves here. Amber, do you want to go first?

Amber Rudd: Yes, I’m Amber Rudd, Member of Parliament for Hastings and Rye, PPS to the Chancellor, Chair of the APPG for sex equality. Former banker, headhunter and occasional financial journalist.

Andrea Leadsom: Yes, hello, I’m Andrea Leadsom, sorry to be late, I got waylaid. I’m the MP for South Northamptonshire and I had 25 years in finance before coming into Parliament, in various things ranging from investment banking to project finance to banking to banks to funds management and hedge funds. I also was Chairman and Trustee of a charity that helps parents who are struggling to form a secure bond with their children, for nine years.

Mary Macleod: I’m Mary Macleod MP for Brentford and Isleworth in West London, Chairman of the All-Party Parliamentary Group for women in Parliament and I’m PPS to the Secretary of State for Culture, Media and Sport, Olympic Legacy, and Women and Equalities. The longest job title I think I’ve ever had. Prior to that I was in business in the City for 20 years.

Thérèse Coffey: Thérèse Coffey, I represent Suffolk Coastal. I work with Michael Fallon as his PPS, the Trade Minister. Before coming into politics for a short time I was at the BBC and before that I worked for Mars.

Q237 Mary Macleod: Thank you very much. Maybe just as an intro, if perhaps you both could just say a little bit about what work you’ve been doing currently to date on the executive pipeline. I’m sure there’s probably been quite a bit.

Helena Morrissey: So as you know, the 30% Club was founded formally in 2010 with the focus then on the board room. Having established I think a lot of momentum around that issue, you mentioned the pace of change perhaps not being fast enough, although since the 1st of March last year, 49% of non-exec directorships on the FTSE have gone to women. So I don’t actually think if you believe in appointment on merit as well that the pace of change could be faster. I actually think most companies get it and are trying to do as much as they can improve non-exec employment. So since about last July really – we’re going to hear from Emily from McKinsey later – we have been turning our attention at the 30% Club to the pipeline, which I do see as a more intractable, sociological, cultural and long term problem to solve. What we’ve been focusing on at the 30% Club has been to start with professional services first, law and accountancy firms, for a couple of reasons. One because I think if you’re focusing on an area, you might get more targeted actions because it is obviously a big issue with many, many different components behind it. Secondly because that sector has suffered from the problem of too few women at the top in extremis because of the very good statistics at entry level, often 55% or 60% women in law firms at the beginning but still very few female partners. Very, very few female partners as equity partners and senior partners. So we’ve done a targeted, our first real main project with 17 of the law and accountancy and consultancy firms. They came together – one of the interesting things I just wanted to share right at the beginning is that several of them had approached me of their own volition and said, “could you bring us together under the safe harbour of the 30% Club”, which is neutral, non-commercial, it’s not a diversity business, it’s just a group of people who believe this is important and are working alongside the Davies committee trying to implement a number of the recommendations. We had an initial meeting last July where it was clear as we went round the table, there were 20 firms there sharing their experiences, that many of them had been trying very

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hard and had done a lot for up to a decade and had seen very little change. A lot of mentoring programmes and sponsorship, a lot of diversity initiatives. So what we did was, having digested this information, have an intensive 11 week project involving 17 of those firms. There was a big ask from them, which included a survey, which included some analysis of best practices and so forth, which McKinsey facilitated kindly pro bono. We didn’t share this widely and we have a meeting tomorrow actually to discuss perhaps whether we could share it a little bit more, because it was quite self critical analysis. But to cut a long story short, it came up that there were three main challenges, one was that a lot of the managing partners said, “yes, it’s a huge priority for us,” but you left their office and the commitment dwindled very quickly, that there were people sort of doing the job, day to day, just regarding this still as political correctness rather than real, essential business and practice. That there were doubts expressed about how evaluation and systems worked and promotion processes and you’re ten times more likely to make partner as a man than a woman, and the processes around evaluating people were judged to be not accurate and fair, by both men and women. So these surveys that we did assessed men’s attitudes as well. Last but by no means least and I think a topic that we’ll get onto because not least the Sheryl Sandberg talk about leaning in and all of that, there is this issue about women expressing their ambitions less explicitly. I’m going to quote because it’s such a difficult thing to say but, “they’ve developed detrimental adaptive responses to the discouraging environment they’re in.” So basically we’ve got into a sort of negative feedback loop really where women feel a bit disheartened. I mean interpreting into my kind of language it would be they feel a bit disheartened by the culture of the firms, feeling that they had to give everything. One of the questions we asked was, “does work have to be your number one priority to be a partner?” More than 70% of women said yes, but much fewer men, less than 60%, in the 50% of men thought the same. So then women end up - they weren’t leaving, what was really fascinating is they weren’t leaving; they were just becoming a bit disheartened to do less high octane jobs. Anyway, that formed a bit of an insight. There was a presentation of the conclusions in December and one of the outputs was that the managing partners agreed to have an ongoing forum like Lord Davies’ Steering committee to keep on with this. I chaired the questions and answers at the December meeting and directed these at the managing partners who were all a bit surprised by some of the data. So we hope we’ve got a more accurate diagnosis of the problem at least now. We at the 30% Club have also now started with the corporate sector and have just had the first similar meeting and it was actually in November, we have another one in February, the PLCs who don’t want to do a McKinsey type analysis this group particularly, they want to see what’s worked already, sort of pilots that have really taken off. Last but not least, I’ll let Amanda speak! We’ve got a big initiative going with the investor community who I think could push from a sort of owning companies, from the other side as it were, in terms of encouraging particularly CEOs and exec level management, because I think that’s a missing piece at the moment. One of the things that hasn’t really been followed through from the Davies committee was the call for the CEOs to stipulate targets from their ex-cos. It’s been a battle won at the chairman level, but we’re targeting the CEOs. We’ve got a number of initiatives but basically there are 14 members of this investor group, the assets total just under £2trn, and we’ve been working on first of all a sort of carrot set of initiatives to try and encourage through good governance from our discussions. Now it’s going to be a little bit more of the stick as well, ahead of the AGM season some of these investors have indicated that they’re prepared to vote against or abstain against the annual election of chairman or nominations committee chairs if not enough has been done.

Q238 Mary Macleod: Thank you very much; we’ll come back to questions in a moment. Amanda, do you want to just give us a summary of your side of things?

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Amanda Mackenzie: I won’t go into what the Lord Davies work has turned up because I think you’re all very familiar with it and obviously I think it’s the partnership – the compound nature of all of those measures and work like 30% Club that’s made that difference. What I am struck by, I suppose this is – I’m just about to start my sixth year on an exec committee on the FTSE 100 and my third year on the Mothercare board – if we’re wanting exec directors and we’re wanting CEOs, the journey needs to start now for your 30-somethings because it’s not going to happen with your cohort of people that today can become non-exec directors. As Aviva we’ve got not bad statistics, sadly our board has now gone from 25% women, because of a matter of timing, to only 10. But John McFarlane is absolutely up for the 30% commitment and we’ll build back to that hopefully very quickly. In terms of senior managers, so that’s the top 1% of the company, we’re at 21% and then at “Heads Of” which is the top 2000 if you like out of 40,000, we’re about 34%. So you can see where it begins and I think it’s at that point, that sort of early 30s when yes, having children becomes an issue, but actually the key thing seems to be not getting general management experience early enough. Then all the commensurate issues that have led you to, “why wouldn’t you do that?” i.e. confidence and belief and expressing ambition, whatever. So I feel that actually there’s a whole piece of work now that needs to think about literally from school right through, but that’s the point where we can start to really accelerate there to think about that and those women coming through, because otherwise they won’t have got the right experience to become the CEO 15 years hence. If you look at me I’m kind of in a – as I always describe it, I’m in a functional ghetto as it were. So realistically I’m going to really struggle to be a CEO in a FTSE 100 unless something quite interesting happens, and it’s very unlikely. I’m not saying this to be a, “poor me,” but it’s just the journey I should have potentially taken or other people like me, 15 years ago, is to be very strict about getting into GM roles.

Mary Macleod: Into what, sorry?

Amanda Mackenzie: General management. So begin to have P&L responsibility early and then take that forward.

Q239 Amber Rudd: Just on that note, did you find that male peers were doing that and they’d just prepared better?

Amanda Mackenzie: Potentially yes, but I think it’s part of actively managing people’s careers. So one of the things we’re looking at now, we’re going to have a women only talent review which understandably some of the men may not quite like that. But it’s just a way to make sure that we’re really focusing on developing women and are we hearing what they are saying about their aspirations. As we know a lot of women wait to be recognised and a lot of the stats show that. It’s a really focused time where we look at our best performing women and go, “really have we understood what they’re about and want to achieve?” then you can start building them from a “Head Of” through to a top 1% and then obviously through to the exec committee, with broader experience.

Q240 Mary Macleod: Can I just ask you a bit more on some of the root causes? You’ve mentioned some of them about confidence, belief, not getting management experience early enough, P&L experience, then also the work that you were doing on the law and accountancy firms, where they obviously felt that there wasn’t a fair system. Did they really understand the root cause and why these things were happening or was it just that it had happened for so many years? Are there people and witnesses who have come into see you and talked about unconscious bias?

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Helena Morrissey: My sense is that business cultures today actually seem quite old fashioned compared with other aspects of our lives and that women aren’t great – it’s hard to generalise but I do think this is the case – at asserting themselves and fighting for change. In general I see people accepting it and then feeling downtrodden quite easily. I think being conscious – when I speak at schools or universities – is to get across to young women, because I completely agree with you Amanda that a lot of this starts quite early on – that actually you do need to take control of your career and you do need to actually ask for things and be conscious of the choices that you make will have an impact on the direction that your career will take. I think it may go back very early on into the classroom and very deep rooted conditioning and then women feel embarrassed or just don’t feel – I mean somebody said to me the other day, “we just don’t know how to play the game.” I said, “well that’s because you’re not, actually, you recognise there is a game but also you’re not trying to change the rules. You’re just passively slightly waiting to hear, ‘am I going to make it to the next level’ rather than there’s all these adages about men plotting the next stage, spending at least an hour a day thinking about the next stage in their career.” So a lot of this seems rather nebulous and it’s hard to then say, “there’s a plan to fix that,” but I do think one of the things that has been encouraging over the last couple of years as the spotlight has gone first to the boards and then a bit below that, has been that actually companies are now more conscious of it and thinking, “actually some of the changes that we haven’t made around…” I don’t want to talk about flexible working or whatever, but it’s still a little bit taboo or a little bit difficult I think in some companies, whereas now I think there’s a realisation that actually that’s more working smartly for men and women and using technology. So I feel quite optimistic about the next generation, that there is more consciousness, but I think that’s part of the reason why it’s so difficult to solve this.

Q241 Mary Macleod: Have you got any thoughts on that?

Amanda Mackenzie: I see it almost like balanced scales and gradually what happens, if you look at all the various contributing factors, so it’s not one thing or maybe even five, it’s ten or twenty; they sort of just outbalance the scales so they just make it harder and not worth it to push through and tolerate feeling slightly alien in quite a lonely environment and to put up with some of that difficulty. Then you compound that with the cost of childcare and that alone is not the issue, it’s the fact it’s that plus everything else. If you were adoring your job, you could see your way to the top, you felt confident, the childcare issue would almost become irrelevant, or could. So I think it’s the balance of the scales outweighed by the environment, the financials and probably the hardwiring which means that it is much harder for women and less likely they will continue in corporate life.

Q242 Thérèse Coffey: That’s very interesting to hear – we spoke to Ruby McGregor-Smith, and she was talking about career rotation as being key and similar things. But could I just focus Helena on the aspect of the investors. We heard from BlackRock and L&G, from James Charrington and Nigel Wilson. What we saw was quite an interesting divergence. So definitely L&G moving into a proactive state, writing to the FTSE 250 saying, “what are you doing about it?” Whereas BlackRock were not being quite so on that agenda yet, though recognising this is coming. Could you tell us a bit more? I understand that obviously your main return has to be for your investors, but could you tell us a little bit more about what you think investors could do proactively to ensure that the pipeline of talent is a key focus for the ExCos.

Helena Morrissey: Sure. I think you’re right, first of all there’s a big spectrum of opinions about this within in the investor community. I do think there’s a bit of a trickle down effect though,

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that I think people are realising one of the impacts of the financial crisis is clearly that people – well, investors – have reassessed the effectiveness of boards and there is more focus and scrutiny. Arguably this was a big miss from the investment community before, to look at a board and to really analyse whether this board is capable and also a good mix of people. I think the other people looked at some of the financial institutions and the very sort of monoline nature of some of the boards, very male dominated and very traditional. So I think that general point has been seeping into the consciousness, but arguably a bit in slow motion with the investment community. I think one of the things that has changed relatively recently and again following the Davies committee’s report is the Financial Reporting Council has obviously updated or changed the corporate governance code to specifically require – at least in the comply or explain basis – company boards to have gender diversity policies and measurable ways of tracking their policies. Again some of the laggards within the investment community – because there’s the Stewardship Code and we’re supposed to apply the standards set by the Corporate Governance Codes to the investee companies, so even those who don’t really believe in it, not hearts and minds, but they go by the book in terms of what we’re supposed to be asking, have agreed that it’s now become one of the general check list issues at the very least. Then you’ve got companies at the other end of the spectrum who are actively engaging and saying, “why haven’t you done more in this?” What we’ve done within the investor group; we had an initial kick off seminar last February, actually to coincide with the first anniversary of the Davies report, when we had around 150 people, mainly from the fund management community, to hear from a chairman who really gets it and speaking very eloquently about the difference it’s made on his board, right the way through to Legal & General who actually were one of the speakers. It was a palpable shift in the psyche of the room; there was initially a lot of scepticism and people seemed to be feeling, “why are we going through the motions here?” Towards the end they were sort of saying, “well why wouldn’t we be expecting this?” So again what we’ve done now is put in some guidelines, what people can do to, as we put it, embed diversity into their stewardship policies. So we’ve said this because everybody has these principles that they’re meeting companies with, again, it’s a bit of a mix – some companies are more actively activist, some financial companies are more activist than others. But we said at the very least include the discussions about gender diversity in the board effectiveness reviews that you’re having. Right the way through directors have to be annually elected or re-elected and we’re saying, “if there is no sign of change then you should carry out your stewardship responsibilities and if you do that this is one of the good governance principles then you should be voting against the appointment of either the chairman or the chair of the nominations committee.” Some of our 14 members are doing that; we’re just about to encounter the next AGM season and so we’re meeting on Monday just to remind everybody and to have any particular targeted areas. For example, most of the remaining all-male boards on the FTSE 100 are the mining companies, they’re listed here and our argument is, if you want to be listed here you’ve got to be by the rules here. So I concur there’s a spectrum, I think what it’s done is it’s shifted over the last year and the corporate governance code changes have yet to be factored into the accounts.

Q243 Thérèse Coffey: Just to build on that, what they did seem to agree on was that there was an idea that’s come in earlier in the enquiry of reporting lower down the structure. Now actually the companies felt that might be over onerous in having to put it into their report, but actually both BlackRock and L&G thought that transparency would actually be beneficial. So although they might not vote down something on it, they certainly both believe transparency would be better.

Amanda Mackenzie: How onerous could it be? Everyone has the stats and we mustn’t hide behind saying we don’t.

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Thérèse Coffey: This is really McGregor-Smith who felt it would be onerous.

Helena Morrissey: Well, there’s slightly different scales sometimes but we all – so someone who is ExCo might be somebody else’s Operating Committee, but that is just an excuse I think because we all know – Amanda mentioned your statistics – no one outside would know what grade N and above means, but we know that means senior. So we measure starting with our own baselines. So I think there is a strong appetite for voluntary change and where there isn’t, investors can nudge it further.

Q244 Andrea Leadsom: Okay, thank you. Can I go back to the pipeline? It does seem to me, having been through that personally, that there is an issue and I’d be grateful for both your comments, on the fact that the traditional career takes the form of you’re a brilliant graduate, you get a superb job, as a girl you’re often ahead of the blokes, you’re doing incredibly well, then my goodness, you have the temerity to get married and have children and that’s the end of your career. So there’s an awful lot of accusation, certainly in the banking sectors I come from, that you can’t have both. I’m talking about a few years ago, not many years ago. It does seem to me that there is a fundamental problem with the traditional picture of the career path. In other words that if you were to take five or even seven years out that there’s absolutely no way back. Of course that also becomes a self fulfilling prophecy because certainly I know a lot of women who did stop, have children, highly qualified solicitors, people who were absolutely at the top of their game, had children and have never gone back to it, not because they don’t want to but because there’s no route back. I just wonder if you can both comment on is there any thought at your sort of level into how to get women who perhaps ended their career in their early to mid 20s, so at a fairly junior managerial level, had children and then in their early 30s to mid 30s would actually quite like to go back and take up their career again, but there is no route back because their age peer group, i.e. the blokes who are in their mid 30s, are now getting their first board positions, so it’s unthinkable that you would allow a woman who had taken time out and hadn’t put in the years to get back on that ladder. What’s your response to that?

Amanda Mackenzie: I suppose I would probably want to say that about a chap that took seven years out, I don’t think the process exists for anybody. It’s just the sheer physicality of time means it’s quite tough. From what I’ve observed from other companies putting a lot of effort in once a woman decides to have children is very valuable. Creating confidence in her that there’s an expectation that she would come back and she would enjoy it and that it won’t be a nightmare and she’s not finished. Then you have to ramp up that effort if they then choose to have another child relatively quickly, because that’s quite a vulnerable time as well, because then the compound of the two children makes it really tough. The other thing we’ve begun to do more actively in the past few years which we hadn’t done before which just seems to be working is keep quite closely in contact with women when they’re off on maternity leave; it’s easy to step away from something you’re not close to, by definition. So that seems to be really working quite well. Talented women come back and then they make an informed decision once they’re back, rather than going away and not coming back for years.

Q245 Andrea Leadsom: Do you think that employment legislation mitigates against that, because there are complaints from time to time from employers saying, “well we’re not allowed to ask women what their intentions are, they’re not allowed to come back in for an afternoon a week because they’d lose their entitlements,” and so on and so on. Do you think there’s more that could be done in an employment legislation sense to support women who ultimately want to get back and who want the flexibility to keep in touch and keep their options open?

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Amanda Mackenzie: Well I certainly think that it’s a bit of a shame that these protections have been put in place. I think ultimately they end up backfiring a little bit because of the nervousness that companies have about discussing any of this with women. I think there are some initiatives – we certainly have keep in touch days that women can – like you’ve said, so elected, it’s not compulsory, but they can decide. I always encourage young women who ask me, who say, “I’m thinking about having a child but I’m worried I’ll now be put in the slow lane or it will be assumed that I won’t want to take on something,” you have to speak up. Actually you have to have that conversation before you leave or before you’re pregnant or when you’re pregnant, because a company can’t really ask it. I think that is a mistake really, that it would be helpful and I don’t think it would be discriminatory, handled in an appropriate way, for a company to have that conversation. I also think – and it’s not necessarily my area of expertise – but I do worry that the year potential on the maternity leave that women can take has others slightly groaning and worried about how they’re going to cope with it, rather than saying, “actually this is worth the investment. We spend a lot of time and want this woman to come back.”

Q246 Andrea Leadsom: Let’s just come back to that because there is this sense that if you take some time out – and as you’ve just said Amanda, if a man took seven years out it would be extremely difficult. Why would it be extremely difficult? Completely accept that you’ve missed out on seven years of where the company is going, but what is it intrinsically that means that if you stop your career at 25 to 32 and you come back in as a 32 year old, what’s to stop you taking on the role of your peers who are 25 and haven’t had children and building up your career again from that point? Is it just culture, or is there something more that’s a stumbling block?

Amanda Mackenzie: I don’t know in all honesty, but my sense is it’s “just” culture, which is of course anything but “just” culture.

Q247 Andrea Leadsom: The fact is it doesn’t happen does it? It really doesn’t happen. You don’t find that someone is encouraged or able to keep in touch for seven years and then jump straight back in as if, “I just left yesterday and here I am in my job.” Obviously not with companies guaranteeing to keep that job open, but it does seem to me that it is simply a cultural thing that stops companies saying, “actually this woman was brilliant when she last worked here seven years ago, let’s take her back. Seven years have passed, so what?”

Helena Morrissey: I think as well now that we’re expecting, just from longevity and so forth, that people will have to work longer, that in a way you want to say, “so what if it’s a 50 year career and you lose 5 out of it?” We don’t measure lots of things by time at the desk necessarily, it should become more irrelevant. I do think there are some companies who have tried these so called returnships which is a very conscious effort to put somebody back into a role, if they were in a professional role, with specific training. I think again technology can enable people to do an annual update very cheaply from a company’s point of view and then to have a three month rehabilitation or three month re whatever it might be called. That’s not the word, but to learn some of the things that you might technically – you know, life might have moved on. But I’m keen to experiment in our organisation with that because I do think it does seem one of those real wastes when something that’s just the passage of time rather than any loss of skills – and you know they’re very capable and you know that they can achieve a lot so in some ways you want to bring back those people. A lot of my contemporaries were exactly as you described, they stopped work never to return and yet they were incredibly capable.

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Andrea Leadsom: Yes and are now learning bridge and flower arranging and cookery.

Helena Morrissey: Or the PTA or something which might be good but I know they would sometimes love to be back in a career.

Q248 Andrea Leadsom: Yes and just one more if I could and that’s on part-time, I mean I am very bitter and twisted of course about this but it has always seemed to me, from my personal and colleagues’ experience of it, that going back as a parent part time is extraordinarily career limiting. Again, I’d like your comments on why is that so extraordinarily career limiting, because if you cannot possibly be a board member three days a week, why can you be a board member five days a week? What right do you have to Saturday and Sunday off? Whilst the obvious answer is you don’t have a Saturday and Sunday off, the reality is that for many women in senior positions who are working three days a week, they’re also logging on as soon as their children go to sleep. They’re logging in on the days they’re not supposedly working and so on. Again, is this just a cultural thing, or is there a real reason why a woman can’t be in a senior position part time?

Helena Morrissey: Could I go first on this one because one of the things that happened at Newton, the company I was CEO of, that wasn’t designed to improve diversity but actually had that impact was – this was over a decade ago when the markets were weak and I was under some pressure to make redundancies and instead asked for volunteers for a four day working week for a temporary six month period. Then the option would be for the person who chose it to come back full time. To my surprise as many men as women took it. To this day some of the most senior male fund managers remain on four days a week and it removed the stigma of flexible or part-time working. Obviously that was unintentional, I mean it was a nice by-product, but it meant that it became acceptable and more than that because it was doing me and the company a favour, to come forward and volunteer. To this day we have as many men as women come forward and ask for that, and it’s made it other than a women’s issue. Now is it perfect? When we get three days that is more of a problem I think in professional roles, sometimes it just is hard if it’s a client facing role and so forth to provide the cover. Not impossible, but just a bit harder. But I just shared that because I think that it was an unintended but positive consequence of that experiment.

Q249 Andrea Leadsom: So could you do your job four days a week Helena?

Helena Morrissey: I can’t really do it in five. I’m one of those people that kind of works 24/7 but in different – like I do work at the weekends but I’m there with my children doing homework. So I don’t know that I really could, but I’m making a conscious choice to –

Q250 Andrea Leadsom: In a way you’re really proving my point which is that you’re not working five days a week either and probably if you want to go to your child’s carol concert or whatever, probably you can actually find the space in your diary to do that. So actually what you’re saying is you’re doing your job within your life.

Helena Morrissey: I’m fitting into my terms, yes.

Q251 Andrea Leadsom: So what is it that means you have to be paid for five days a week as opposed to four days a week where you would still be doing your job but presumably you’d be delegating slightly more and you would have a little more flexibility? I sort of feel in a way you’re proving my point which is that it is a cultural issue, in that anybody who works part time in a senior

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role is still doing their job when they need to do their job. I do worry that it is the culture simply of saying, “no, you have to have a contract that says 37.5 hours,” even if you’re working 80 as I think a lot of MPs do.

Helena Morrissey: Well, I think you’re right Andrea because the thought that flipped into my head the second I asked that was, “how would it be perceived if I was suddenly part time?” That was my kneejerk, confessional point that I thought, “no, they wouldn’t accept it,” and therefore I couldn’t do it. Yes, I’m guilty as charged.

Thérèse Coffey: I find it very frustrating actually; I used to employ a lot of part time women in my job. I find it terribly annoying that they feel they have to work more than the hours they do. I want to pay people for the hours they do. I think it’s a bit of a fig leaf if we run that risk of saying, “well you’re only going to get paid for four days but actually we know you work seven days a week anyway.”

Mary Macleod: I’m not sure we’d be able to persuade a taxpayer to pay MPs intelligently.

Thérèse Coffey: No, I understand that.

Andrea Leadsom: I was just going to make an observation though that at our first session we had the Chief Executive of Microsoft. No, it wasn’t, an MD, who was proudly telling us that he plays golf on a Friday afternoon to set a good example to all of his staff. Interesting idea, I thought.

Q252 Mary Macleod: I just want to pick up also on the point of – you were talking about early 30s and getting the right experience, you were also hinting about it starting even earlier. Some of our other witnesses were talking about actually this starts at school, because they were saying girls were choosing not to do maths for example and therefore limiting their choices and anyone who gets onto a board has to have some kind of financial management experience in some sort of way, to understand basic management reporting. Also in terms of some of the more male, dare I say, industry sectors, that girls are just not being encouraged at all and there’s nothing to make engineering or ICT look interesting and sexy and something that they should be doing? Do you feel it is something that we should be really focusing on school, careers at schools and widening those out a bit to try and open up and broaden the horizons of young people?

Amanda Mackenzie: I think so and I think it’s having the right kind of role models as well. I know everyone talks about it, we’re all familiar with it, but business role models I’m sure are a very long way away from an 18 year old girl’s mind before she goes to university but that becoming more normal feels important. Somehow, and I say this carefully because I don’t know how the words might sound, there feels like a sense of duty that would be quite good for girls to begin to feel at that point. You consider the FTSE – most insurance companies own what, 2% of the FTSE? It is a good thing for pension funds to own – you’ve all got financial services backgrounds; you know the way that virtuous circle works. So it’s actually a good thing to work for a FTSE but it feels like a very strange conversation to imagine having with a teenage girl, that she might want to. You think of the cultural transformation that needs to go on in a lot of those companies and the ethics that need to improve and we know that on the whole women are very good at doing the corporate governance and all of that side of it, you think, “actually that’s a whole mishmash of thought that would be very good for an 18 year old girl to begin to get a sense of and feel important, that they can make a really good contribution there.” I think alongside that there needs to come the sponsorship which I think also relates to a couple of the points you just made, and the confidence and the self belief which then seems to get eroded, almost from 21 onwards.

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Helena Morrissey: I would only say that I do speak at quite a lot of schools and I am impressed generally speaking by just how confident the sixth formers are at that stage. I think it was you Mary that mentioned the brilliant career and then it’s sort of downhill very quickly, usually coinciding with having children. I guess I also try to add, they’ve often made their choices about the maths and so forth by the time they’re 17 and 18 and have a vague idea maybe of the field they want to work in, but I try and add this sense of consciousness that if you do want to have – it’s often the furthest thing from an 18 year old bright, ambitious girl’s mind that she also might want to have a family. I think this awareness that actually there may be some choices and it’s not wrong to actually want to have a career, because I do think there’s quite a lot of pressure that women put on themselves. I know I’m just about – not quite, but in most of my children’s classes – the only working mother. You get the guilt from the children and there is a sense where women, perhaps because we’re in the transition generation, but you either were expected to be at home or now you’re expected to make the right decisions but be everywhere all the time. I don’t want to sound, “poor me,” about it, that’s not what my point is, but it’s more that it’s okay to feel, “actually I might want to build my career,” rather than, “I’m going to have to stop,” to think a little bit for the next ten years. Often I get some asked some very thoughtful questions from the girls who – you can see their minds thinking, “actually I’d better choose a career that I might be able to combine other things in my life.”

Q253 Amber Rudd: Could I just bring this back to childcare for a minute because I know it’s one of the things that Lord Davies always makes the point very strongly that one of the reasons he felt there were so many women involved when he was in Standard Chartered in Hong Kong was because childcare was so affordable. He obviously sees that as a very important element, particularly I imagine for the female pipeline. We also heard evidence earlier in the week from women who have said to us the problem of childcare is cost, and the cost is prohibitive at a stage where successful women aren’t yet earning enough for it to not matter. You know, by the time women are perhaps at mine and Helena’s stage where you have succeeded and you continue to succeed, it isn’t such a grotesque amount of your income. But when you’re in your late 20s, early 30s, it’s such a hit that that’s the reason some women leave the pipeline and then they fall into this trap of not staying in touch and there are all sorts of other problems. Do you think that cost of childcare has a very prohibitive effect on the pipeline?

Amanda Mackenzie: Yes, in a word. I mean it’s linking all the thoughts isn’t it? If you think of the hours that people work and need to work to get promoted, culturally right or wrong, and therefore you probably need a very long hours nursery or a nanny. If you do that, you’re paying that out of your net income, it’s effectively £80,000 or thereabouts. Well that alone puts you in a very high band of salary.

Amber Rudd: £80,000?

Amanda Mackenzie: Yes thereabouts, if you gross it up.

Helena Morrissey: Because you have to pay tax on the nanny’s earnings which is obviously also on your taxed income.

Amanda Mackenzie: So that takes either an incredibly liberal couple together that go, “this is a benefit for the long term so we’ll trade that and we’ll make that work,” but it feels a very tough thing to go back to work basically to earn nothing for a while. I mean I did, I worked effectively for no money for a while. But I was lucky I had a partner who went, “actually I know you, you wouldn’t

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want not to do that,” but that takes a lot and there’s a lot of luck almost in have you found the right person who’s going to help you with that?

Helena Morrissey: I agree almost entirely with what Amanda said though I don’t think it’s a panacea to all ills but I think if there was some tax break around childcare then it would help some of those people who feel they want to go back to work to carry on. But last week there was just a couple of reviews on the Norwegian experience with their quotas, which obviously I’m against, but it was very interesting hearing that actually in a culture where they said – I didn’t know about their childcare arrangements – that it was very affordable and very egalitarian in terms of what the male and female responsibilities around that might be. But they are still, in terms of the executive roles, worse than the European averages and so again it comes back to this, it might help but it’s also to do with these other things that we’ve talked around.

Q254 Amber Rudd: I heard on the radio earlier in the week a comparison of the French to the English example in terms of costs of childcare and the norm in France that working women go back to work because it’s so well subsidised that they can all afford it and it’s higher quality, and yet of course they don’t have any greater success than we do getting women on senior boards. So it does exactly confirm what you’re saying Helena which is that it must be part of the help, but it just isn’t the full answer.

Helena Morrissey: What I was going to say, it does feel that it’s such a multi-faceted problem. I think the only thing that hasn’t come up that I was going to raise, people talk about – I know I got lots of calls last year when Marjorie Scardino and Cynthia Carroll both stepped down, soon after Kate Swann stepped down, and with this wringing of hands, only two women left in the CEOs of FTSE companies. I said, “well they were the products as it were – it sounds horrible but – of the environment 20 or 30 years ago.” We think companies are almost falling over themselves to solve this at the moment; the door is ajar, they want to keep the women. I know we work very hard and then sometimes we lose them and they just want to be at home with their children; it’s their decision and it’s the right thing for their family. But then we had the conversation about staying in touch. So I think we do have to be a little bit patient is what I am trying to say.

Q255 Andrea Leadsom: What about the atmosphere, I mean particularly in the City which is my background? I’m on the Treasury Select Committee and every time we’re talking about regulatory reform and there’s eight blokes, white, middle aged, middle class, Oxford and Eton most of them. Actually not Eton, but Oxford or Cambridge. Then occasionally I sent out a little stiletto that says, “nice to see a few women here,” or something sarcastic like that. All my male colleagues on the Treasury Select Committee groan, “oh she’s off again.” What about the culture and specifically in the City? Did you see Helena, that report which I sort of think maybe I invented it in my mind but it was this fantastic scientific report that showed that male levels of testosterone rise when you’re under pressure and so men take more risks in the dealing room? Actually it was a physiological argument for more women in the dealing room, for example. So I’m sort of muddling up a load of things here, but more women in the dealing room, less testosterone, but also the culture. I mean the Bank of England, they still walk around in pink waistcoats and bring you your cup of tea on a silver salver and, “dear gents,” is the way they head all their e-mails. You have to stick your hand up and say, “hi, I’m not one.” So that very male dominated culture, one, is it excluding women because it’s just unthinkable and two, is it the case, because we also heard the other day from Dr. Ros Altman who all my male colleagues said didn’t understand the yield count and I’m like, “no, she was right, you were wrong.” She’s the only person who has come out saying QE is a bad policy. I tweeted afterwards, “perfect example of why we need more women at the Bank of England,” and I get 20

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tonnes of rubbish from people saying, “you’re just saying that because she’s a woman.” I’m like, “no, I’m saying that because she’s the only person who has disagreed with the governor. All the others are men, discuss.” So is there an issue of the culture on boards and that sort of male domination?

Thérèse Coffey: Group think.

Andrea Leadsom: Yes group think, exactly.

Helena Morrissey: I do think so. I think Amanda you mentioned the world lonely but we’re all going to get a bit sad in this discussion. [Laughter] I’m trying not to think of my own board away day yesterday which is – I do have another woman on the board but she wasn’t able to come so it was me and it is hard not to feel sometimes a bit isolated. I think this culture point because – I mean I’m conscious myself that I’ll be encouraging – obviously it becomes a vicious spiral. If women don’t want to join the next layer up because they don’t want to be the only woman in the room and it’s horrible and they think, “why do I want to spend hours talking about things? I want to get on with doing things.” I think that’s the other thing with women often, then we’ll never change the culture. So I do say sometimes you have to take a step forward, we have to slightly make it easier for the next group coming behind and just go through that which is slightly painful. Perhaps when you sit there and you contribute, I try and be positive about it and say, “maybe you’ll change the dynamic a little bit.” I have to admit I have been conscious that there have been situations where I have been the only woman in the room and I’ve looked down the agenda and I have chosen consciously which issues am I going to raise my hand on because I know otherwise I’ll be seen as the annoying woman in the room, because I know I don’t agree with the men and they will wave things through.

Q256 Mary Macleod: So do you think and do women have to be more like men?

Helena Morrissey: No, no, in fact that’s the whole point.

Amanda Mackenzie: Women that are too shrill are actually not going to be heard in that environment. I don’t think you have to be completely the opposite either. So no, but – no.

Helena Morrissey: You have to be able to take the knocks; I think that’s the bit that’s difficult.

Q257 Mary Macleod: So do they have to be tougher, more assertive?

Helena Morrissey: Well I think or else – again just a personal situation that occurred quite recently, there was this group, they were effectively ganging up on me and I realised then I was not going to be able to frankly rebuff it or maybe not even hold it together in terms of argue why they were wrong and so forth. So I thought, “okay I am just going to bide my time here and then I’ll follow it up afterwards with them, but I’ve got to work out my tactics here.” I know a lot of women – because it was painful – would have just thought, “oh to hell with this, I’m off.” But we have an obligation to the next generation.

Amanda Mackenzie: You’re quite right; you can’t change a culture from the outside. In it, you’re more likely to make it better. Also I couldn’t agree more; I think if you want to head into a big issue with a room full of chaps, don’t head long into it. Take them one by one outside the meeting and that is the way – yes, and that is the way to get the results. So focus on the end result, but it’s

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slightly annoying that that’s the process. It’s learned bad behaviour you could argue, because you might get a better hearing if the culture was slightly different, but it is what it is. But I think it feels to me definitely better.

Q258 Thérèse Coffey: Can I just talk about the appointment process? We’ve heard quite a bit about cultures bias training and general use of it and very specific use, recruitment. I just wondered also how perhaps Aviva – indeed we heard from L&G yesterday, they speak to their headhunters about the lists of people in very senior appointments. Could you tell us a bit more about that and what you think perhaps could be done even better?

Amanda Mackenzie: Okay there are a couple of things we – well, one thing we’re experimenting with and one thing we’ve been doing that we’re going to roll out. So one thing we’ve been experimenting with is beginning to have conversations with women that aren’t in our sector but are senior women, as a way to say welcome, so we’re effectively saying, “this is us, this is what we’re about.” So you don’t begin the recruitment process at the point you need somebody. So you marry that with also doing talent reviews just for women, which I mentioned earlier. The second thing which we have done which has been a little bit of a revelation, but you do need the people to stay in the business, the senior men that have been doing this. So we’ve been doing reverse mentoring which I know is something that Peninah Thomson pioneered, and that has been quite fascinating. But the men have to actively engage. My reverse mentoring experience was with a gay chap, so I got to understand about a whole new world and I was able to in a quite safe environment ask what may seem ridiculous questions. But the chaps’ tendency, because they’re senior, is to immediately start mentoring, and of course the whole point of this is it has to be reverse. So the point of them being there is to learn about the dilemmas, the world, the conversation, it’s a totally different complexion of conversation. So that’s just a couple of things that we are beginning to look at.

Helena Morrissey: I just had two observations. One was on the headhunting community, because I do think that they have changed their tune quite a lot since the Davies report was published and, since 30% Club was launched, when I think there was quite a lot of resistance to change, a lot of protection of relationships with chairmen and nomination committee chairs. I think now there is awareness that they actually are probably preserving the longevity of these relationships by being more proactive and reaching out to different types of candidates. Not every headhunter is that proactive, but I think that a lot has changed. Just to share one example where we were looking for a fund manager in a particular – a global equity fund manager and I was asked to interview the shortlist, four men, and there were basically just men on the desk at the time. I said, “why are there no women candidates?” and a guy who was doing appointment is a very decent chap, wouldn’t have in any way intentionally excluded somebody but actually then said, “there was a woman candidate and I realise now that I’ve made assumptions about where she is in her stage in life and actually you should see her as well.” Now I rated her second, we employed one of the men but we stayed in touch with the woman and would definitely consider her for another role. He said he hadn’t intended it, so we’re reflecting an unconscious bias point whereas we know that men have complexities in their lives too, but she had several children and he was thinking about commitment. But he was making assumptions that he wouldn’t have made...

Q259 Mary Macleod: One final question from me and that is – maybe it’s slightly two. One is how optimistic are you about the future of the executive pipeline? Then secondly if there was something you’d ask the Government to do to help in it, what would it be?

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Amanda Mackenzie: I’m very optimistic on the non-exec pipeline, not so optimistic on the executive pipeline.

Mary Macleod: You think it will take longer.

Amanda Mackenzie: It will take longer, so I think it will get there but it really will need active management and thought. I think if there was one thing, for me it just goes back to real active management of women in their 20s that helps create the conversation where they can openly discuss the dilemmas of childcare, think about becoming general managers, actively have sponsors, actively help their confidence. So as a package of measures, I don’t know how that would turn up in the workplace, with Government creating it. But that cohort needs to be actively thought of that way, and then you will get your executive directors for the FTSE 100 in 15/20 years time.

Helena Morrissey: I sort of have to be optimistic I feel, but I am realistic about it. It’s going to take time and also there will be steps backwards along the way, I think it’s hard to see it going in a straight line because a lot of this is trying to shift...you know, when we had our fourth child my husband and I had a discussion and he went freelance as a journalist and I realised only much later that that was a very unusual situation, that most people didn’t have. It was just assumed that the woman would be the one who would take a slight backseat or change her career. So I think that it’s a lot about men’s attitudes and changing – I do think looking at my oldest children, my oldest son is at university, that they’ve grown up in a world where they’re expecting much more equality between the sexes and women, and men having choices as well. So I am optimistic for the next generation but I think it’s going to take a bit of time.

Q260 Amber Rudd: Can I just add that I felt that 25 years ago. When we went to university, it seemed like the same amount of men and women were joining Agile and JP Morgan at the time, and it all felt fine and it felt like it was going to change.

Helena Morrissey: My own personal experience was that then I encountered some and I was part of a very traditional merchant bank at the time with the silver trolleys and things. I did experience overt discrimination once I had my first child, I mean that organisation has changed a lot since then I know, but I think we were a bit naïve. I feel now I was naïve, I was not prepared for that, I was not expecting that, whereas I think the slight difference is that to the new generation, joining an environment where companies are actively trying to nurture their female talent.

Q261 Mary Macleod: And what can Government do?

Helena Morrissey: Well I do think it would be very helpful and then increase the tax take to look into the childcare issue, I mean I know there is the whole affordability issue, but even to have –

Thérèse Coffey: Ruby suggested a year.

Helena Morrissey: A year of..?

Thérèse Coffey: A year of tax breaks for the transition.

Helena Morrissey: I think to keep encouraging companies to keep the spotlight on it, to keep monitoring it, to keep talking about it, that is what you’re a) doing, but not to think, “oh well,

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because there isn’t legislation we can do we should drop it.” I think this is very important, it gets media coverage, it gets people thinking and it keeps people through those dark days when you don’t seem to be making much progress. Show on the road.

Mary Macleod: Well thank you very much, we know you’re very busy and we very much appreciate it. Do drop us a memo if you have any other thoughts.

Peninah Thomson OBE, CEO, The Mentoring Foundation Dr Emily Lawson, Partner & Co-author of Women Matter series, McKinsey & Co. Ama Afrifa-Kyei, Advisor, Employee Engagement, Diversity & Inclusion, Deloitte LLP Louise Brett, Partner, Consulting, Deloitte LLP

Q262 Mary Macleod: Maybe we’ll just get started because I know you’ve all got busy schedules. So thank you very much, I think you were all here earlier so we don’t need to do a preamble again; we all know who we are. Andy, thank you very much for coming in. It’s probably worthwhile as you all have lots of experience in this subject already, do you want to just all do a starting short pitch in terms of what your current thoughts are? Peninah, do you want to start?

Peninah Thomson: What my current thoughts are? Okay well as a way of cutting into that can I say that The Mentoring Foundation is running the FTSE 100 Cross-Company Mentoring Pipeline Programme, which is what I wrote to you about and thought might be interesting to you and your colleagues. In that – would I be correct in assuming that you know about the FTSE 100 Cross- Company Mentoring Executive Programme, or would that be an unwise assumption?

Mary Macleod: I think probably it’s worth just mentioning about it.

Peninah Thomson: Okay I just don’t want to cover ground that you all know already. For the last ten years I’ve been running the FTSE 100 Cross-Company Mentoring Executive Programme. We started off with 18 FTSE chairmen mentoring women at just below board level with a view to, as Helena described earlier, moving them into credible candidates for NED roles. That Programme has been a huge success; it’s been emulated in nine countries and has had 103 women go through the Programme. It’s not a volume programme, it’s highly bespoke. Of those 103 women, 82 have been successful in achieving either an NED role or an executive committee role or have gone onto the board of a large charity or become a trustee of a major pension fund, etc. One of the precepts on which I built the FTSE Programme is that “success has many faces”, so I’ve not been too narrowly focused on getting women into NED roles, but fortunately they have, it’s wonderful. After the Davies report came out, I was asked by a group of six of the chairmen whether, if the intellectual property was bought out from Praesta, which was where I was working at the time as a partner, and a not for profit organisation was set up, specifically to lead this work, would I be chief executive? I said I’d be honoured and so that came into being in October 2011 and since March 2012 I’ve been 100% of my time committed to being Chief Exec of the Foundation. It only does two things; one is the Programme I’ve just mentioned, which is the Executive Programme which is now expanded. In March 2012 I was asked by two of the chairmen whether I’d set up a similar programme for women at an earlier stage in their careers, specifically to address the pipeline issue. So what we’re doing is running that as a pilot, with six companies involved and I’ll gladly go into details of those perhaps a little later in the hour, if you’re interested. 10 women have been nominated by those six companies, women with typically 8 to 10 years of experience. Their age range varies slightly. It’s 38, 39, 40, 41, 42, that sort of grouping - in general, younger than the women on the Executive Programme. That’s started, we’re running it as a pilot, we’re

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monitoring it and rolling the learning back into the design of the Programme as we go through. It’s a co-creation between the companies and ourselves. If it’s deemed to be a success by about June or July this year - that’s a major hinge moment of evaluation – then we’ll roll it out to all the other 60 companies. There are 61 chairmen mentoring on the Executive Programme. The innovation with the Pilot Programme is as follows: I felt that the gap between the chairman/chief exec level mentoring that is provided for women on the Exec Programme and these women at an earlier stage of their careers was too great for the mentoring to be truly effective. And in any case, the chairmen are tied up with mentoring on the Executive Programme. So my proposition was that we should ask some of the earlier Mentees on the Executive Programme in 2003, 2004, 2005, who are now very, very senior themselves, to act as Mentors. This was regarded as an interesting innovation and taken up and it’s working incredibly well because the added dimension it provides is the role modelling, of being a senior woman. I’ll pause there – so, basically, I’m the Chief Exec of The Mentoring Foundation. We have these two Programmes, we have the support of 61 chairmen, we’ve got a Pilot Programme running that we hope we will roll out this year. I’ve written three books – “A Woman’s Place is in the Board Room” and variations on that theme – and I do a lot of lecturing and speaking on conference platforms etc.

Emily Lawson: Thanks. Hi, I’m Emily Lawson from McKinsey. I think there are multiple reasons why I’m here and why I care about the topic, including the fact that my mother has spent a lot of her career working on this and in fact got an OBE in services to diversity, so I had good role modelling. In terms of the specific invitation, I think there are two roles which overlap that I play within McKinsey that are relevant for today. One is that I am the Head of our Human Capital practice, so I look at all of the work we do with companies about how they manage people in organisations and how they get the most out of their people and how they generate new kinds of behaviours, new ways of aligning what people want to do with what the company needs to do. The second is for the last two years I’ve led our research on diversity which we do as part of our external outreach and the contribution to the communities that we work in. But also because it’s obviously directly relevant for us and McKinsey is very concerned to do better by our own women and improve our own representation, but also because it’s very important for our clients. In helping our clients become more effective, we want them to have better representation of the best talent they can possibly get. So the two particular bits of data we can draw in in the conversation; one is our Women Matter 2012 report, which I know you’ve seen bits of because it’s been quoted in various of the discussions, which looked at 235 companies across Europe and looked at their data for the last four years and women’s representation at all levels of the companies. The second piece of research is the one Helena referenced on the professional service firms. Helena has already used some numbers; I’m very sensitive to the fact that those numbers were very sensitively held by a lot of the participating companies so we’ll have to see how much of that data we can actually share.

Mary Macleod: Perhaps we can speak to you about them afterwards.

Emily Lawson: Exactly, as a participating company, I have to say the law firms in particular were very sensitive, given the accounting firms and consultancy firms are in a considerably better position; I think we’re slightly less sensitive. Just on the Women Matter 2012 research for a second, there are a couple of numbers I wanted to reference because they came up in the previous discussion. One is actually a factual correction point because the Norway number has been misquoted since that discussion last week and I noticed it was misquoted in the Sunday Times at the weekend. It said Norway was below the European average in terms of representation of women on executive committees; that’s not true, Norway’s representation is 15% which is above the European average of 10%, or it was in 2011 when we looked at it. The number that was

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reported is 3% which is actually their growth rate. So the growth rate is not very good, they’ve got a long way to go, but they are actually above the European average which makes sense because when we look at the correlation between societal and governmental support for women’s working, it has a correlation, although it doesn’t totally explain women’s positions on the executive committee. So the kind of government activities, government spending on childcare, tax relief etc., and just general spending on families explains about half of women’s representation in executive committees. So I just wanted to make sure that was in there because I’m worried Norway’s being used to really bash a lot of activities and we need to make sure we’re using the data properly. The second one was the point about the pipeline. The three critical findings last year, the Women Matter research as you know in 2007 established the business case for a greater representation of women. What we’ve done over the last five years is to try and back that up with, “what would you actually do about it?” Let’s assume we all buy the business case, so let’s get practical. Last year’s research was very much attempting to get very practical about specifically what do you do, and the three categories of activities that we found made the biggest difference, one was visible senior commitment. So 92% of the CEOs we spoke to said, “I’m absolutely committed, it’s a top three priority,” when we spoke to middle management, it was 41% believed that that was true. So you can talk to the top and they all say it’s fantastic, but it doesn’t penetrate, it’s not visible further down the organisation. The second which is relevant to your previous discussion is that you need to know what problem you’ve got, because different companies and in particular different sectors have got different problems in the pipeline. Now most people have got problems all the way up to be honest, but the particular pain point varies. So financial services for example recruit about 50% women and the total representation of women in the companies is 50%. The executive representation is 7%. So there’s just this massive drop off, and consumer does slightly better, but they also recruit about 50% and they get down to 11. Metals and mining companies only recruit 25%, but their representation in executive committee is also 11. So they’re just much better at managing the women once they get in. So I think knowing what your particular problem is is important. If I just reference an example for a second, one of the banks that we’ve worked with has gone back into high schools, just as you were saying in the earlier discussion, just to try and work with both young women but also underprivileged students who wouldn’t otherwise think of applying to a bank in the City, to just try and broaden their understanding of what people in banks do in the first place and the fact it’s not all just testosterone-driven traders. Their incoming class of analysts last year was 44% women, which is about double what it was five years ago. So really figuring out that they had a pipeline problem, starting with recruitment, and they’ve specifically addressed recruitment and it’s had a big impact for them. So the three things were the CEO commitment, the know your numbers and target it and then the third thing which you did also talk about was tackling the mind set. It’s both women’s and men’s mind sets. An example of that is the unconscious bias training you were talking about just before the break. So those are the three things we know make the biggest difference, but it’s obviously critical to target them where you particularly need them.

Louise Brett: Hi. So my day job is actually running an analytics practice in financial services across Deloitte. About 18 months ago I was asked would I take on the Women in Leadership role for Deloitte from my predecessor who was retiring from the firm. I said yes I’d be very interested in doing that, I was a bit of a noisy individual about that matter anyway, on two conditions. One, it became an executive agenda item, and the second, that it had a budget. Those were agreed to. And Emily’s point, what we’ve done in that intervening period is understood the data, because we are very representative professional services firms. We have a stated commitment at the top, we have a bulk of senior partners who aren’t too sure whether stated commitment was something we were doing for a CSR reason, that it was a flavour of the month, is it really something we’re focusing on? Then another group that get it but can’t see that linkage between what we’re saying

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and what we’re doing. So the first thing we did was run the data. Given that we have an analytics lab, we took all our survey data and we resurveyed 1600 people to really understand where there is this difference in perception and the unconscious bias in statements we make. We’re a meritocratic organisation we state; at our director level, 57% of men believe it and 43% of women believe it at the same rate to that statement. So we took it down to that level of granularity to understand – to your point – where are our problems as a business? We used to be a 50/50 employer of graduates, male and females. We’re about 39% women at the moment, and I know the banks have suffered with this and there is the trust issue in the City and not appealing to women. So that was another area we were looking at and to a point made earlier, how do we attract women who potentially are more thoughtful about their careers? So rather than doing the milk round in the third year of university targeting women, we’re doing it in the third term of the second year because we know as they go into their third year they focus on getting a really good degree. The men are always up there first trying to get into the limited places we offer and as a major recruiter of grads, you can see them, they come in first. So we’ve looked at some of our problems to understand how we’ll make a difference. Then through to the CEO commitment, David Sproul, Mary I believe you’ve met him recently, yes? He has now come out and announced in many fora that this is his personal commitment, to make women in our leadership positions a priority for the firm. The executive have it as a priority for the firm. Our gradient hasn’t changed in many years. We’ve had loads of initiatives, we’ve had loads of effort to try and change the curve; the curve has maintained at that gradient. So he has absolutely stated his commitment. He has asked his executive, and frankly that was my role, I didn’t want to be the Women in Leadership person, he is and executive are, I am just the agitator to make sure that it’s frequently discussed. That is now being cascaded down. An example would be an all male executive of all of our businesses, executive team, the leader of that, to “how do you feel included or not,” has said some of the behaviour we exhibit as a male team is we josh at each other and we end up putting people down under the guise of a joke. He said it’s much worse for women when they come in, because they’re the only woman in the room typically. It’s that sort of behaviour, the unconscious behaviour; they think they’re having a bit of a laugh. That is being flagged, signalled and said that that’s unacceptable. So we’re doing some quite cultural stuff, to your third point. So we’ve got CEO commitment, we’ve got the numbers absolutely understood and we’re beginning the very hard journey of, “where is this cultural shift? Where is the unconscious bias?” really damaging the chances of people moving up.

Q263 Mary Macleod: Interestingly enough on those three things, it was absolutely what we had to do in politics as well. Certainly in the Conservative party, the commitment had to come from the leader at the time, David Cameron, who said, “I’m going to drive this through.” So it’s interesting, it almost follows exactly the same pattern and we’re making progress. It’s still not good enough yet. Ama, do you want to add anything to that? You work at Deloitte as well.

Ama Afrifa-Kyei: Yes I support Louise in delivering our Women in Leadership agenda. I also support the Head of Client Service’s Director in advising our firm’s talent partners and business units on how we incorporate Diversity and Inclusion in our firm-wide talent strategy. Ensuring that all we do is inclusive when deploying our key talent agendas, and is fully aligned with our talent brand and business priorities.

Mary Macleod: Thank you very much indeed.

Q264 Thérèse Coffey: Could I ask about the unconscious bias training? Do you have it in Deloitte? Is it required for everybody at a certain level or is it focused on recruitment?

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Louise Brett: We’ve rolled out something called Respect and Inclusion and that is beginning to open up the kimono that is unconscious bias. We are absolutely engaging in talking to suppliers about running conscious bias across the firm. We’re about to embark on four pilots with our four executive teams across the UK on inclusive leadership. Our Australian practice is the most advanced practice globally on the Women in Leadership agenda. They have a passionate CEO, male CEO, who has asked partners to leave the business because they don’t get this agenda item. They have developed this inclusive leadership training, they’ve put 300 partners through it, it has made a seismic shift in how women are advancing in that business. They now sell that product to our clients, so I’ve asked them to come over and they’re going to run four pilots in the UK for us. If it works in the UK context, then it will be rolled out.

Q265 Mary Macleod: I want to go back to the chief exec commitment and how you embed it within an organisation because – I mean I’m sure all of you and from our business experience too – we talked about this decades ago. It just seems to have taken such a long time to even make a dent in it, but maybe now there is more commitment and we’ve had some great examples of that today. So perhaps there is more awareness of it and people are willing to do more. But how do you embed it right down the organisation? So first you have the chief exec or the leader of the organisation saying, “yes, we’re actually going to drive this change through.” How do you actually get that down into every level? Is it about performance measurement and putting it into pay and rewards? Tell me what you think.

Peninah Thomson: Shall I start? I’d love to tell you a quick anecdote; was I right in thinking Andrea that you mentioned a leading investment bank, or have I made that up?

Andrea Leadsom: Yes I did.

Peninah Thomson: Okay so some of this might be very germane to your own experience. After the second book came out – “A Woman’s Place is in the Board Room: The Road Map”, an investment bank contacted me and said, “we’re interested in this, we’d like to do something about it. Would you like to advise us?” This was about five years ago. I said, “yes, I’m not doing consultancy now I’m doing coaching but I’m very happy to do this.” I went along – this is written up in one of the books, and I’m able to talk about it in the public domain, it’s been signed off by the company. The leader was – absolutely first prerequisite – completely committed to doing something about the terrible levels of attrition among senior women that he was very concerned about. We co-designed a series of senior staff workshops to discuss the issues, to which the investment bank brought people from all over Europe, which was superb. It will not amaze you at all I’m sure to know that there were two women in the room on average at each of these workshops, and about 20 people in total. An awful lot of men sat half-listening, not very interested, playing with their BlackBerries and not paying one iota of attention. They were there under sufferance, they don’t want to be there and they were only there because their chief guy had told them to be there. He was slightly oblivious to this because it was so much a pattern of normal behaviour. We had a debrief afterwards and said, “I appreciate it is one of your norms of behaviour of course, but I don’t think anyone in that room was paying any attention whatsoever. It’s superficial compliance because you are the top man, you’ve told them to be there.” He said, “no, no, no, they do understand it, they do believe it.” We did a little survey and lo and behold it came back that they thought the workshops were pretty much a waste of time, and they came back with a lot of pushback. This galvanised the leader; he was furious and he did something very, very brave. He did two things that were structural. First of all he said that anybody who lost a senior woman – any of the men in that room who subsequently lost a senior woman from their team would have to talk to him and explain the

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reasons why. Secondly he said, “5% of your bonus is now going to be linked to your ability to retain women.” That was a cultural – what’s the appropriate word? It started a shift, to shift some of the culture. Now isn’t that interesting? He was willing for that to be written up as a case study, very interesting. So there’s a little instance, other colleagues will have other instances.

Thérèse Coffey: I do apologise, I’ve got to do a parliamentary thing downstairs, I’m very sorry.

Emily Lawson: The CEO commitment, I think there are two parallel routes for this. One is what the CEO themselves and what the top team around the CEO do and how that’s visible in the organisation, but the other is how it’s reinforced because broadly people look at the next people they report to as their leader. So when they’re commenting that it’s not really middle management agenda, they’re not always referring back to the CEO. So the first thing is that CEO commitment has to be not just nice statements for the CSR purposes, but it has to be tangible inside the organisation. So putting more women on the executive team and everybody seeing that; I mean one of my clients has just done a major restructuring and they’ve gone from having one woman on their executive team to none. They were really upset when their diversity scores came back 14 points lower than the previous years with their engagement surveys and I’m like, “you can’t really have it both ways.” I think the thing that they were all very cross about afterwards is it was not intentional that that happened, it’s just that as each appointment happened, they didn’t consider it. So by the time you’d put the whole team together, you ended up with an all-male committee, but it wasn’t that they thought about it. So where we’ve seen really profound issues in the pipeline start to shift, and I agree with Helena and Amanda, it just is going to take a very long time, it’s where the kinds of statements are actually immediately reinforced. Peninah’s is a good example. But it’s things like one of the CEOs we work with couldn’t for various reasons restructure the executive committee, but created an innovation committee and got a mixture of men and women from the next level down to sit on the innovation committee and made sure it was 50/50 and gave that group a very important role to play in creating the company’s new strategy. So if you can’t structurally work the existing system, actually changing the system to make it happen, but then making sure that’s actually reinforced by the leadership that people experience every day. One critical thing is measuring promotion rates. I was interested in the conversation you were having with Helena, Amanda, about the whole point about data and having commitments lower down the organisation. When we did Women Matter 2012, 60% of the companies could not give us data for four years across Europe on their women’s representation. Now it does exist somewhere in the organisation, but the ability to pull it together is actually much less than you think, because you have different financial systems in different countries, sometimes the data is owned by Finance, sometimes it’s owned by HR, sometimes it’s owned by the business unit. So actually tracking it is much harder than we would think from a logical basis. So making sure you are actually tracking it so that you know where these problems are occurring. One critical point in the promotion point is you have to intervene before the promotion is decided. So reviewing the promotion slate after you’ve basically decided is useless because you can’t ask – people will have very good reasons for why it’s that set of MDs and not another set of MDs, but before that happens looking at the slate and saying, “well look, we’ve got 40% associates and therefore we would expect 40% of associate vice principle promotions to be women. Come and tell us why not. You may have a good reason, but you’re going to have to at least tell us why that is.” Just raising that consciousness makes a big difference. So the CEO commitment people refer to, it is what the CEO does and says, but it’s the absolute embedding of that and people seeing it being reinforced. What we know about changing behaviour in organisations or changing adult, whether it’s institutions or not, is you’ve got to give people signals in four dimensions in order to make it happen. We’re all very logical creatures, we all make sense of the environment and we filter data

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constantly in order to make it make sense, because we all get too much information. The first is you have to reinforce it through systems and processes. So we’ve talked about various examples with promotion panels and bonuses. The second is capabilities; we think your training is a good example. You need to give people the skills to actually behave in a different way; they may not know how to assess women in an equivalent way. The third is you’ve got to see role modelling, we’ve talked about that. You’ve got to see the important people in the organisation doing it. The fourth is you’ve got to believe it’s actually important. Every time we do Women Matter, we sort of hope that we’re not going to have to have a discussion again about the business case and we kind of always do. Although the data is out there; Business in the Community had an interesting set of consultations including somebody who was basically saying having women’s representation has the opposite effect. It makes companies perform less well.

Q266 Mary Macleod: When you talk about the business case, are you talking overall or board performance?

Emily Lawson: Well it’s at all levels, right? We have data that says having women on both executive and non-executive boards is correlated with those companies being more effective. None of us are pretending we can say it’s a direct result. But there are all sorts of research, Ama may be more experienced in it than I am, that says any team structure which is more diverse, up to a certain limit, is going to more effective at decision making than a structure that has fallen into group think.

Ama Afrifa-Kyei: The women on boards Cranfield University research and also Deloitte DTTL research women in the boardroom: a global perspective, suggest roles actually increased the bottom line.

Emily Lawson: So there’s a huge variety of data on this, yet it’s not really penetrated in some organisations. So I should probably stop now.

Q267 Mary Macleod: Anybody else?

Louise Brett: To make it a business imperative. So you’ve got the CEO statement, it’s then how do you translate this to be a business imperative? In our world it is firstly the client; our clients do not expect to see a panel of white men, middle aged men, turning up to solve their problems in a global economy. So where you may have had detractors in the past starting to articulate it in that way, it becomes, “let’s not debate this anymore. Let’s be very transparent about it’s absolutely critical for us to be successful in the future and this is what we want to look and be like.” Let’s be very transparent – Emily, to your comment – about succession planning. So it’s sort of all happened under a bit of a cloak and maybe some daggers as well and women don’t necessarily know what experience they’re supposed to have had. In the past we have not been great at saying, “actually the people I’m going to consider will have had this sort of experience in these sorts of markets. That’s what I am looking for to bring into my executive team.” What we are saying is a greater transparency on the criteria required and then we can target women to get that experience, to help and say, “this is the funnel. This is the route and if you do these steps, you’re going to get the same sort of chances as your male colleagues.”

Q268 Andrea Leadsom: Louise, can I just take you up on that? Amanda in the earlier session made an interesting point about her own situation, saying if she’d wanted to be a CEO of a FTSE

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company she shouldn’t be in the career path she’s in. Is there an issue with that, with the fact that women are often drawn towards the HR, sort of more mentoring type of roles in organisations and that the route to the board simply doesn’t exist from those sorts of roles? What’s Deloitte doing about that?

Louise Brett: One of our targets – so we need some targets; we don’t have quotas but we need targets and it is about women in executive roles that are not the girls’ roles, marketing, HR, because those routes don’t come through. Fine if women want those roles, that’s absolutely great and they’re very, very good at them, but that isn’t the route through normally.

Q269 Andrea Leadsom: But just to challenge you on that; why isn’t it the route through? Why is it not valid that your Chief Executive of Deloitte could be somebody who’d had their career in HR? Is it because there’s a sense that somebody who came through HR wouldn’t have the financial knowledge?

Louise Brett: It’s typically because they’ve chosen that route too early, so they wouldn’t ever have had the P&L ownership responsibility. They wouldn’t have had necessarily global perspective. I think you could make the HR to CEO move, as long as you hadn’t been in an HR track all the way through.

Q270 Andrea Leadsom: Okay so Amanda is right to say she’s taken a wrong turn in order to – and so what do you do to make clear to women who might be drawn to those roles that that’s going to be a dead end for you in terms of progression?

Louise Brett: I think firstly it’s being very clear about what our succession criteria looks like, so they can see it’s not spending 10 years in an HR role. Sponsorship is massive, so this is where it’s really beginning to hit – rubber hitting the road. In our corporate finance business, we have an extended leadership team of 60 partners. They are now sponsoring the next 60 women at the senior manager director level, because corporate finance is probably the hardest part of our business…

Q271 Mary Macleod: Are they sponsoring men too?

Louise Brett: Yes they are, but the men have already got their sponsors and we certainly haven’t made it a women only thing. We’ve also just launched a competition with the ICAEW to put two female directors through their Women in Leadership programme. That was very much announced by David as just for female directors, but the idea was for male owners of businesses to tap the females on the shoulder and say, “you really ought to put in your business case for this.” I’ve had several e-mails; for many of them it’s the first time someone senior has said, “you should be putting yourself forward as a leader of our business.” That has been incredibly powerful. So again, several of them came back and said, “do I need to be an accountant because it’s ICAEW sponsored?” We said, “no, it’s not at all, but it will give you the financial capabilities that perhaps if you hadn’t had it before now make you more likely to succeed in senior management.”

Q272 Mary Macleod: I was going to ask you all anyway in terms of what role does cultural mentoring and sponsorship have in all of this? Maybe it’s a bit of all three and that sort of thing too, and financial training. But how important is that and should we be much more structured about our senior women and giving them that support?

Amber Rudd: It sounds like they’re being flooded with coaching and mentoring opportunities in companies at the moment.

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Mary Macleod: Sponsoring, I tend to feel, is one of the most important because that gets you somewhere.

Louise Brett: For me sponsorship is advocacy and women won’t naturally – generalising – go out and find their own advocates. So if you can help that and there’s somebody there banging their drum and also asking them to change how they behave too, I think that for us is a shift where mentoring – we’ve had quite a lot of mentoring in the past.

Emily Lawson: We’re very good. People have their own internal mentoring at all levels. I agree I think the sponsorship is about actually knowing somebody is there to back your business case to get to the next succession plan and to get to the next level in your group is very imperative and is very different from the mentoring aspects.

Q273 Mary Macleod: What I find quite strange and I wonder why is why the men tend to automatically go and find a sponsor and women don’t.

Peninah Thomson: One of the chairmen on the FTSE Programme had a very interesting comment on this. I won’t name him, but he said there is in his view an absolutely extraordinary difference between the behaviour of men in their 30s, that particular cohort, and women in their 30s. “I don’t know what the reason is, but I am besieged,” he said, “all the way through my professional life I’ve been besieged by men at that stage looking for the next opportunity, badgering and hectoring me, ‘I can run the Hong Kong office, why aren’t you helping me do it?’ ‘I should have got that promotion, why didn’t I get it?’ I just don’t see that from the most able women who are not badgering.” These are his words, not mine. “Women”, he said, “need to badger more.” I think that was quite interesting. I do think there is a greater reticence among women. Not all women clearly, I’m not making a sweeping generalisation. All the women in this room by definition have been at some stage good at badgering. More generally, in general terms, though – I think women – I’ve been an executive coach for 14 years and my observation is that women are more reticent still, even the most able among them, and many still profoundly hope that good work conducted with diligence will of itself be sufficient. We all know that that is a pious hope, it’s not true.

Emily Lawson: That’s why we – going back to the discussion again you had earlier about schools. I think we know – there are all sorts of studies published about observing children in nursery situations – that girls are rewarded for sitting still quietly drawing, playing, “aren’t you a good girl? You’re really reading that book so well.” The boys are, “oh look at him, isn’t he active?” There was a fascinating study published actually where they looked at babies in the cradle and they asked parents about, “Describe your baby to me.” The parents of the baby boys were 20% more likely to say, “oh he’s so active. He’s really going to be an active little man there.” You actually measured the babies kicking; both sets of babies kicked exactly the same at the time. So we are trained to notice different things. We’ve just been innately socialised to notice different behaviours in boys and girls. So by the time we get to this, it’s not surprising that women are less likely to stick their head above the parapet because they don’t know that they should ask and they don’t know that they can ask.

Mary Macleod: I was just going to say it’s the same with female politicians, the broadcasters were saying were exactly the same. So female politicians don’t ring up and say, “when am I next on TV?” whereas the men do.

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Andrea Leadsom: Yes it’s quite interesting actually, I have a 9 year old daughter and a 17 and 14 year old son and they have forced her to get into the top set for Maths by ridiculing her poor Maths skills. I’m like, “yes, well done. Be that role model.”

Q274 Amber Rudd: Do you also think there’s an issue to do with relationships between men and women? While women who want to get on, of course they want to find a sponsor and have people who are senior to them to take them seriously, but if there were more women they’d be able to form that bond with them. There’s a certain nervousness about going up to your senior men and saying, “I really want to talk to you about my career,” and he says, “let’s do it over dinner,” which might be perfectly harmless but might not. Do you think that’s still an issue for women?

Emily Lawson: It is an issue. I teach one of McKinsey’s leadership programmes for people who have been in the firm for about a year and it is one of the questions that I get when I run a women’s lunch or whatever for our women, is that they don’t know how to do that. It often comes up in their relationship with clients as well which I think is relevant, that they are nervous about certain kinds of client counselling relationships in case it’s misconstrued which obviously in a client focused environment is very important as well. So back to my point about they don’t know whether they should ask or whether they can ask –

Amber Rudd: They don’t know where the boundaries are.

Emily Lawson: Yes exactly, that whole thing of how do you set this up in a way that isn’t going to be misconstrued and doesn’t get you into trouble and the fact that usually it is going to be well intentioned at this point in society. But I think there is a nervousness there and we know – I think data was referenced earlier – that women are generally also more risk averse. We start off a bit more risk averse and we become actually more risk averse as we have children. So anything that’s perceived to be a risk we actually think is more risky than the men think it is. So I think there’s a whole – like all of these issues – it’s a really complex sort of ecosystem of things affecting it. So what you need to figure out is what are the two or three things you do that start to catalyse the shift, because you can’t affect the whole system simultaneously?

Q275 Andrea Leadsom: Emily is there also a tendency for women to not want to enter into those kinds of sponsoring relationships, because Margaret Thatcher was always accused of sort of doing, “fine thanks,” and pulling up the ladder behind her and not bringing on women at all and that the party has never recovered.

Amber Rudd: Women get a bad name for that sometimes in the professional world. Do you think that’s true?

Emily Lawson: I really don’t think it is. I’ve never seen any data. I’m sure there are extremely unhelpful senior men, I’m sure there are some extremely unhelpful senior women. I mean there’s enough people around that that’s true, but there’s absolutely no data to back up the whole senior women don’t bring junior women through, in fact it’s the opposite because we know that organisations which have a good record of promoting women are also bringing women through at other points of the pipeline. So it’s just not true.

Peninah Thomson: I think it was true in the past, there was more of this Queen Bee syndrome in the past, but I agree with Emily, I just don’t see any of that now. It’s much more extending a helping hand to other women coming through. I think in itself that’s an indicator of increased

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confidence. When women have a sufficiently stable ego and sense of self, to be able to offer without feeling they’re in some way going to be diminished by offering. I think that’s a transition we have seen; I have seen it in my professional life.

Louise Brett: Yes I completely agree with that.

Q276 Andrea Leadsom: Yes, just about part time, because we haven’t discussed that, and the extent to which it is a very real limiting factor or whether it’s just a cultural limiting factor. I thought Helena’s comment was very interesting about inviting everyone to go to four days a week and the take up was equally men and women. So clearly their business survived as a result of that. So is this just a cultural problem for women?

Louise Brett: I think it’s a bit of both. We’ve done quite a lot of thinking about part time working, particularly at partner level, and we’ve been reasonably schizophrenic about it because we haven’t been clear about what our policy is and we’re very hidden when someone goes part time and we only have six part time partners out of 700.

Q277 Andrea Leadsom: Can I just ask you, were they partners before they went part time or did they get promoted to partner when they were part time?

Louise Brett: I think all but one went part time after they were partner.

Q278 Andrea Leadsom: Yes so there is that fear of doing it and then having no prospects.

Louise Brett: Well we recognise we’re in the dark ages on it and it’s something that is a very important subject for our people. We’re rewriting our policy and communications to our partner group to say, firstly we don’t want there to be stigma about part time working because absolutely it’s seen as something has gone wrong if you’ve gone to part time. Equally we’re also saying our model is not to have part time partnership, but we recognise in people’s careers there will be a period of years, potentially, where they want to be part time, we want to retain them in the business and we’re saying that’s absolutely what we want to be about. But from Deloitte’s point of view, our view is actually you’re an owner of a business and you can’t be a part time owner. You might part time work for a period of time.

Q279 Andrea Leadsom: Okay so if you had, let’s say, because this happened in Invesco Perpetual when I was there. We had a fund manager who had very sadly late stage MS. He was a very good fund manager and he ended up in a wheelchair unable to do very much at all. So he ended up working more and more part time, still running his fund, still with the same performance, until the very end of his life, but very much working part time. That surely is counterintuitive to say that you can’t still contribute. I mean there can’t be some magical thing about being a partner, whether you own a business, I mean if you own your own sweet shop you can decide whether you work part time or full time. There’s nothing about owning a business versus working for it. Surely that’s not consistent with the agenda to try and help women to achieve the highest positions is it? How can you justify it?

Louise Brett: Andrea, I possibly agree with you, but I think we’re on a journey. So from having no part time partners and being quite frightened of it, and yes we are opening it – it’s not a female thing, it’s opening it up to everybody. There is a fear that too many people will want it and what

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will happen to our business? We’re a highly successful business and we’re on that journey, so we’re moving, but I agree it’s inconsistent.

Q280 Andrea Leadsom: It’s just not – you can’t defend it can you?

Louise Brett: No.

Emily Lawson: We’re very happy with what we’ve – I mean we have a long way to go and we’ve been there so I can talk to you about that one. But I think what it’s taken for McKinsey to be successful in our flexible working is to try a lot of different things. So we don’t have one model of part time work, we’ve tried some models that don’t work, but what we’ve been doing over the last 10 years is allowing people to think about what flexible working looked like for them, supporting them in trying it and then giving honest feedback about whether it’s working or not. So for example, somebody who wanted to work 9 till 4 every day and treat that as a part time working didn’t work, just couldn’t cut the day up like that. But we have very successful people who work full time and then take substantive periods of time off and we have lots of people doing three or four days a week and doing that as part time.

Q281 Mary Macleod: Why couldn’t you do 10 to 4?

Emily Lawson: To be honest not many people wanted to try it. So it’s only a very limited number of case studies, but what this particular woman who tried it found was that compressing her responsibilities as a manager into that period of time was too difficult because inevitably a crisis blows up at half past three. So she was – back to your point earlier about how many hours you’re actually working – there was more pressure on her to extend either end of that time than saying, “I’m just not here on Wednesday, so let me tell you who’s going to look after you on Wednesday.” That was just much clearer. Now I am sure that everybody who works part time is doing at least some aspect of picking up the phone when officially they’re not working, but we trust people’s judgement and we also trust them to call when it’s not working. In our HR systems people can switch almost month by month from saying they’re full time to saying they’re part time to respond to that. So we’ve had to experiment and when I joined the firm 14 years ago, we were substantively less good and we’re much better now and I’m sure we’ve got lots of work to get better. But our most recent programme is the ability to take a number of weeks off, for any reason that you want to give. It can’t be to go and write your business plan for the company you want to float, but for other reasonable reasons. That has had a fantastic – so over 30% of our associate body has applied to do that since we launched it and it’s a very easy one for us to implement because we can plan ahead, we know when they want to go, we can balance.

Q282 Andrea Leadsom: It’s unpaid leave is it?

Emily Lawson: It’s unpaid leave effectively, but it’s very attractive to give people opportunity. For example if they’re going back to India for a wedding, they can take a whole month and go and see their family rather than needing to compress it into holiday. It’s had an equal men and women uptake.

Q283 Mary Macleod: Can I just ask as part of that, especially for Deloitte and McKinsey, where I worked at the top there were very, very few role models who do, certainly men part time, or certainly with children there were very few. So has that changed at all? Are there people at the very top doing it, because that would really help other people feel it’s acceptable?

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Louise Brett: I think that’s where we are on this journey, where I said we’re moving from it being a stigma to, “let’s celebrate the models that work.” We don’t know the optimum range of models. We have a senior male partner who’s part time. When he became in a part time role, it wasn’t talked about because we were still a bit unsure whether we wanted to let people know that that had happened. Now it’s absolutely being talked about and people know who he is and he’s very successful doing it. The reason he has gone part time is because his wife is a very senior owner of a PE time and he wants to spend more time with the children. So it’s certainly an interesting role reversal as well.

Q284 Andrea Leadsom: Can I just ask you again Emily, if the flexibility at McKinsey has – whether you’re tracking the impact on people’s career progression as a result of that flexibility?

Emily Lawson: Yes we are, and some of the models obviously are going to take time to come through. By the way there’s another kind of flexibility that was relevant to the earlier discussion which is doing a different job for a bit. So one of the people in my development group has followed her husband to Canada where he’s been posted by the fund company he works for and she originally went on a normal consultant track but part time, they have two small children. She found in the Montreal office there just wasn’t enough work for her to create to do what she wanted to do part time without travelling and so she’s moved into one of our support research roles. But the expectation is and she knows that she can go back on the consulting track whenever she wants to, either when they come back to the UK or if the office changes its balance of work. So flexible working doesn’t have to be part time, it can be taking different kind of jobs at different times. So we absolutely track this and all of the partners we have who are working part time – I’m just mentally checking that that’s true – were working part time before they were elected, or at least had had a period of working flexibly before they were elected.

Q285 Andrea Leadsom: So it hasn’t harmed their careers then?

Emily Lawson: No, we’re very conscious of it. I mean we do see frankly people go from flexible working to exit, I mean it’s not that it’s 100% successful and always works and some people find part time doesn’t work for them and come back to full time. But there’s no impact on long term career, as far as we can see.

Andrea Leadsom: I know we haven’t got long – is it alright if we also talk about career breaks?

Q286 Amber Rudd: Can I just ask you to respond to the question I was asking earlier which we heard from other witnesses earlier in the week about the cost of childcare making women in their 20s and 30s leave because they certainly can’t afford it and whether that is having a damaging impact on the pipeline?

Louise Brett: Yes, it is. We’ve narrowed it down to an age range around a certain grade where it is most potent as a problem. Women worry about it, typically, generalising, about 18 months before they take action on it. So if you haven’t engaged with them to help them think through how this might work and shared the stories of people who have made it work – a lot of what we’re trying to do is just more story telling, men and women, about how they’ve juggled those important decisions. That’s where we’re losing them because they haven’t got senior enough to really be able to afford it. We’re saying it’s about 65,000, but it’s of that order of gross income that you’re going to have straight out of the door.

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Emily Lawson: We don’t have that sort of clarity of data. I’ve certainly seen it in my clients, absolutely. The conversation that we have internally which at least I have when women come to talk to me about it is – Naomi Wolf writes about this in her book Misconceptions and it made a huge impact on me. She said the problem when you do this calculation about, “I’m going to be working for nothing,” as Amanda said earlier, is that you only take the woman’s salary into account. So you’re not talking about household salary and how much your household is earning, you’re only talking about the comparison of childcare against the woman’s salary. So you’re immediately assuming that that’s the equation. So one of the things we’re trying to do is to reframe it and say, “what’s this as a proportion of your total out goings?” But absolutely, it’s a cost. All the tax breaks that are available, you know, the investment in – the vouchers that we were able to do, we supported that. We have emergency childcare that the firm subsidises that we’ve signed up for, that kind of thing. So we do our best to try and make it affordable, but yes it’s absolutely –

Q287 Amber Rudd: Yet in France where it’s heavily subsidised, they don’t seem to be doing any better on the pipeline.

Emily Lawson: I think it’s difficult to – what we know again is there’s a correlation but it doesn’t explain everything. It explains part of the 50% of women’s representation but not the whole story. But in terms of individual women’s decisions, it has an impact. There is another thing I wanted to add though, it is the cost of childcare but it’s also this promotion into meaningful roles before you have your first child. If you’re coming back to a really exciting job where you feel you’re having tremendous impact or at least you can see that it’s the start of having impact, you are much more likely as you’re doing that to factor in the future benefits, both in terms of your professional growth but also the money. So one of my clients has experimented with a programme of very early promotions for high potential women, 25, 26, getting them into call centre management or that kind of thing, just to demonstrate that there’s a lot more fun you can be having at work, because no matter how much it costs, if your job doesn’t feel meaningful, your baby is a bigger pull.

Q288 Andrea Leadsom: Absolutely right, yes. So can we then talk briefly about career breaks and what you’re doing to try and get women back in who have had perhaps five, seven years out?

Amber Rudd: I thought you were going to say they’ve got seven children!

Louise Brett: One of the things we have – I’m not sure how long transition coaching has been going now.

Ama Afrifa-Kyei: We piloted it for a year so I think about 18 months.

Louise Brett: 18 months and has been highly successful is we’ve always had keep in touch days and that, it’s actually as they come back, what do we do about them? We’ve brought in transition coaching and people returning, be it from a career break, maternity leave, either sexes, it has been very, very powerful. We know from our stats that when you come back your rate of promotion progress is not at the same velocity as it was before. We need to fix that. Part of the getting you back with confidence is where the transition coaching is really working, so that’s our focus at the moment.

Ama Afrifa-Kyei: The way the transition coaching works is before the leaver decides to go, whether it’s a career break or a maternity break, they have coaching sessions with their line manager as well. So they’re having the conversations before they actually exit and also whilst they’re away, if they choose to, and then before they come back into the firm.

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Q289 Andrea Leadsom: Does employment legislation get in the way? Does it make it awkward to have frank conversations with parents on parental leave?

Ama Afrifa-Kyei: We haven’t experienced it; our coaching has actually been quite successful. The good thing about it is this is not just offered to women, it’s for men as well. So the way it works is if you’re senior management and above you do get one to one coaching, but from senior manager and below you get webinars. But either way, you do have a contact point. So you have an individual coach and if you want to discuss matters with your coach before you go and talk to your line manager, you’re able to have that confidentiality kind of conversation first and then have that conversation with the line management. We haven’t had anything in terms of legislation issues with that, it’s quite successful.

Q290 Andrea Leadsom: But presumably you wouldn’t feel you could ask a woman who let’s say had a child and came back, number one, you wouldn’t be able to say to her, “so when’s number two?” or “how many are you going to have?”

Louise Brett: Technically no, you can’t, but of course it’s down to the relationship you have with the individual. Where legislation has been a barrier – and this is an example of one – is where someone has had a child who is very sick and the child is going to be in hospital for a good period of time, wanted to come into work because there was nothing she could do sitting at home. The legislation stopped her doing that.

Andrea Leadsom: Stopped her doing that? Wow, really?

Louise Brett: Yes, because she would then not be entitled to maternity – I don’t quite understand. Yes so the frustrations of having a sick child she can’t even touch and not being able to come back to work, that was not so clever.

Andrea Leadsom: That’s pretty bad isn’t it?

Q291 Mary Macleod: My final question is similar to what I asked Amanda and Helena; the Government is doing a range of things just now, so like you said the Lord Davies commission and tracking progress and he’s reporting back quarterly. We’re looking at flexible working, shared parental leave, we’re beginning to look at childcare; are those the right things we should be looking at, or is there – if there was one thing you could ask the Prime Minister or the Chancellor or whoever it might be, what would it be?

Peninah Thomson: To have more of you. [Laughter]

Louise Brett: Yes, there is a need for Government to be a leading front and I know there are bodies and focus groups around that, but just like in the companies we represent and we work for, it’s saying something and then it’s actually doing something.

Q292 Mary Macleod: Leading from the front and showing that we’re doing it in Parliament, because our issue here is the pipeline. So David Cameron only had 17 women to choose from to vote in before we all arrived. Of course in the 2010 intake he has lots of additional talent which he could choose from over the course of the next two years, it was a pipeline issue but there should be more.

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Louise Brett: I think the things that you’re tackling, absolutely keep on tackling them, but I think also as I mentioned before, keep the conversation going. It’s a bit like women bishops; because everyone’s talking about it, there’s an inevitability about it. Let’s keep talking about – particularly in the executive pipeline. Some say the window dressing of the non-exec roles, because it’s easier to get numbers, the executive roles you can’t window dress, so let’s keep the focus on that.

Peninah Thomson: Yes. I think you’ve got an absolutely vital role to play in sustaining the national conversation and shaping the national conversation. Nobody else can do that to the same extent as the parliamentarians.

Emily Lawson: I completely agree with both of those and I think the other thing we’ve referenced earlier is the vocal commitment is nice, a tangible commitment is even better. So saying, “I only had 17 to choose from so we had to fix the beginning of the pipeline, but we would aim to have 30% of the Cabinet being female by 2020.” Then just thinking about what are all of the steps you’re going to have to take in doing that. So that target is great, then what does that mean in terms of how many people need to be in PPS roles etc.?

Mary Macleod: In the September reshuffle 12 of the 2010 intake into government roles of whom six were men, six women. It’s 22% females in Parliament and in the Conservatives it’s just 16%.

Amber Rudd: So we’ve got big hopes!

Emily Lawson: When Jo Swinson came to our 30% Club presentation for the professional service firms she did open up by saying, “it’s really nice to be with a group where the numbers are even worse than in Parliament.” It wasn’t necessarily what we were aiming for, but it made everybody laugh.

Mary Macleod: Thank you very much indeed.

124 Corrected Oral Evidence - Session 5 Corrected Oral Evidence- Session 5 Thursday 7th February 2013

Members Present: Dr Thérèse Coffey MP (Chair) Harriett Baldwin MP Amber Rudd MP Julian Smith MP (QQ297-338)

Witnesses: Alison Carnwath, Non-Executive Chairman, Land Securities PLC; Senior Advisor, Evercore Jo Swinson MP, Minister for Women and Equalities Evidence:

Alison Carnwath, Non-Executive Chairman, Land Securities PLC; Senior Advisor, Evercore

Thérèse Coffey: I’m Member of Parliament for Suffolk Coastal and co-chair of this Conservative Women’s Forum Inquiry. Prior to being in parliament I worked for a short time for the BBC. Before that I worked for Mars, so I’ve been in the finance side of the business. Harriett, do you want to say a few words?

Harriett Baldwin: I’m Harriett Baldwin, Member of Parliament for West Worcestershire. Prior to that I was a Managing Director at JP Morgan Asset Management, where I was one of the few women and helped with all their diversity stuff.

Amber Rudd: Amber Rudd, MP for Hastings and Rye. I used to work in banking and also headhunting.

Q293 Thérèse Coffey: Just to be clear – I think you’ve been briefed on this already – the whole topic of women on boards has been going for some time and quite a lot of progress has been made. You’re the stellar example in our FTSE 100. We felt it was important to focus on the pipeline of talent because while we can get great non-executive directors in, the actual number of executive directors is small, and we need to try and do that prism. We’ve been having a number of sessions with different people, including investors BlackRock, and L&G, and similar, trying to understand what’s going on. I wonder if perhaps we could start by asking how Land Securities, and any other corporate experience you’ve had, goes about its appointment process to executive positions and what it will do to ensure gender diversity? Does the board even consider that?

Alison Carnwath: These days; these days it certainly does, yes. At Land Securities our executive committee is made up of 20% women and 80% men, which isn’t brilliant but it’s moving in the right direction. We’ve recently made, and not announced yet, two new senior level appointments, they won’t be board level appointments. One is a woman and one is a man, so they’re just below

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board level. There is a heightened level of awareness, with an enlightened and totally impartial Chief Executive, who genuinely believes that more diversity is better. There are some good women, particularly in some of the functional things around Land Securities. That being said, our Development Director at Land Securities – not a board position but a very senior position, she is looking after an enormous number of developments around London – she’s a lady, and has been with us for 10 to 15 years, and has gradually got promoted up to this level of Development Director. She’s a lady called Collette O’Shea. I think we’re okay at it, and there is no positive discrimination, so there’s nobody saying at Land Securities, “It is necessary to get the numbers of women up.” There is a) a level of awareness, and b) a desire, particularly with our new Chief Executive, a desire to try to ensure that we don’t miss good women externally to come into Land Securities. We certainly have got no bias about not promoting them. We’re a small business in terms of people; we’re 600 people, so this isn’t a big business.

Q294 Thérèse Coffey: Do you measure proportion of women above a certain seniority?

Alison Carnwath: Yes, actually that comes through in our case through to our remuneration committee, where we look at structure and management succession planning, and succession planning below board level. That comes through twice a year to the board. Yes, you can see there what progress the females are making.

Q295 Harriett Baldwin: Alison - excuse me, may I call you Alison?

Alison Carnwath: It is a very male industry, the property industry. You may, yes [laughter].

Harriett Baldwin: Yes, probably in terms of industries it’s slightly more male dominated than others, but would you say generally across the UK workforce the fact that there is a dearth generally of executive women is more a function of supply or demand factors?

Alison Carnwath: That is the $64,000 question.

Harriett Baldwin: With your experience, that’s why we wanted to ask you.

Alison Carnwath: I’m not backtracking here, but my recent experience has been more about board appointments than it has about executive appointments. That being said, I think that over the last five years, since Mervin basically really raised a level of awareness here, I have been engaged in and involved in a lot more groups of people who want to just talk about this. They either want me to go and talk to them, or they want to sit around a table and discuss what the problems are. There’s a much greater level of awareness and with that level of discussion and awareness, out of the woodwork come an enormous number of talented women that I never really knew existed. They may be VPs in huge organisations, executive presidents, senior vice presidents in large organisations. They may be running their own business, they may be part of the entrepreneurial foundations that I’ve got involved in. Five or ten years, maybe as recent as five years ago, I would not really have expected there to be so many ambitious women around. Now, because I’m asked to go and speak to them for obvious reasons, there are some talented people around. That’s fine, that’s number one, good; so in terms of supply there seems to be a supply coming through. Number two, I just do think women make different choices. It isn’t necessarily everybody’s aspiration, not even every male aspiration to sit on the board of a PLC with all the exposure and responsibility that you get. I think some women make some choices that they just don’t want to

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do that. They might want to run great businesses, but they don’t necessarily think it’s important for their future to have a board position. Thirdly, I think those that have families and have children find it mostly very difficult to keep engaged with an employer, and then come back after four or five years and slot in. I think just more needs to be done in the workplace there to… If the senior people in large organisations really believe that women have a future, even if they take four or five years out, or even if they take two or three years out, and then come back and then have another two or three years out, the world of business is not yet set up for this. A lot gets blamed on childcare, and who pays for it, and availability and suitability, but employers are not geared up for this. In some cases there is the expectation occasionally, by women, that there’s an entitlement in this day and age for them to be able to slot back in. That doesn’t work either; I think they’ve got to find some way of staying out of the workforce, but staying in touch. More effort needs to be put in.

Q296 Harriett Baldwin: At graduate level, do you hire into a fast-track management stream in your firm?

Alison Carnwath: No, we don’t at Land Securities. No, we don’t; we hire very few graduates, maybe six or seven a year, always Masters. Some females do come through though, they do. Indeed, I do some mentoring for the Reading Real Estate Foundation, which is a Master’s degree, and I always have females. There are enough women in their 20s who are interested in property and we do recruit them at Land Securities, yes. They do often move on; their husband has to take them somewhere else in the world or they decide they don’t want to work for the rest of their 20s, but they’ll come back in. They’ve got a professional qualification; they’ll be able to find a way back in somewhere. If they choose to leave us permanently, we do not keep in touch with them.

Q297 Thérèse Coffey: We’ve heard quite a lot from witnesses about the importance of unconscious bias training. Have you ever come across it?

Alison Carnwath: About what, sorry?

Thérèse Coffey: Unconscious bias training. Not just focusing on women, but all sorts of different bias. Has that ever raised its head as you’re aware of in your corporate experience?

Alison Carnwath: I don’t feel I was ever subjected to this myself. I myself, my career was an investment banker.

Q298 Thérèse Coffey: You’re not conscious of it being at Land Securities at the moment?

Alison Carnwath: No.

Q299 Amber Rudd: The implication really I think is partly the idea that Bob wants to hire someone that looks and sounds like Bob, so their bias is towards hiring people whom they know….

Thérèse Coffey: A mini-me.

Alison Carnwath: Hire people they know…?

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Amber Rudd: They feel look like them or a colleague who has just left. There’s an unconscious bias not to go for something different, which often is a woman. Some companies are doing training to make sure that people who are recruiting look at this more independently, without thinking, “we’d like someone quite like the last guy.”

Alison Carnwath: I think as explained like that, and on reflection maybe I hadn’t really quite understood the expression before, I think there is quite a lot of that. That is very comfortable for people; it’s very comfortable. Those people are people who have done the job that was done either well or badly, and that’s why they’re leaving. It is only in the recent past, I think, that there’s been a growing number of men – I’m sorry to say this – who have become more open-minded. I think there’s a generational thing here. You’ve only got to take the FTSE 100 directors and it’s still pretty much the same club recirculating. There are people who are entering and people who are exiting, but most of the people who enter as chairman have been chief executive somewhere, and most of them are men. That is still the case, but then on the other hand these are the people, mostly, who’ve had the experience, and you need a lot of experience to do these responsible jobs. I think this is just going to take time. I’m afraid to say my answer to all of this is this is going to take time, but we have to continue to make conscious effort.

Amber Rudd: Make a noise about it as well.

Alison Carnwath: Yes, making a noise is definitely important. Government prodding I think is extremely helpful. Quotas I think are probably not the way, because most women feel so insulted by the fact that they’re going to be put in place for a quota reason.

Q300 Amber Rudd: Most of the women we’ve seen at senior level take the same view you do, but some women I know, having spoken to them, as I’m sure the rest of us have, think that it’s so hard to get on that there should be some sort of quota system. Are you sure that we’re right to turn our faces against it?

Alison Carnwath: No, I’m not absolutely sure. I think I probably know who you’ve been talking to. Some of the people of my age who’ve been banging on for years, perhaps more vociferously than I have, about trying to get more diversity in boardrooms, they feel that progress has been so slow over the last 15 or 20 years that really the only way to go is the quota. In other words, I think the quota system is seen as something that is there because everything else is failing. I don’t think it’s there in those people’s minds because they think it’s the fairest way. I don’t know whether…

Amber Rudd: No, I’d call it fatigue.

Alison Carnwath: Yes, fatigue it is. Yes, it is [laughter]. Yes.

Julian Smith: As a successful chairwoman…

Alison Carnwath: Chairman, actually.

Q301 Julian Smith: Chairman, sorry; apologies for being late as well. Are you clear on the incentives, in all the companies you lead or are on the board of, that the incentives that those companies have for their managers on recruiting diversely, are you clear on what incentives are put in place for your managers? Is that something you worry about or are aware of?

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Alison Carnwath: We don’t have any incentives in Land Securities, not monetary incentives. We have policies that require people to be very fair and to ensure that they don’t just look at white, Anglo-Saxon males born in the southeast of England, because we genuinely believe we’d benefit from that. Anyway, our business is throughout the UK and we like people who are being in touch with all parts of the UK, with this new…

Q302 Julian Smith: Do you think there’s an opportunity to say to those managers, “we obviously want you to choose the best person, but if you recruit diversely you will get credit in your bonus, or annual deal, or compensation rate”?

Alison Carnwath: I think that would have some perverse outcomes and I think that comes back to the pipeline. If you were going to be paid a few thousand pounds for recruiting, let’s be blunt about this, a woman over a man, I think there are those people who would think that few thousand pounds was much more important than recruiting the right person.

Q303 Julian Smith: I think the thing I’m referring to is some companies, particularly very successful US banks, will, as part of their incentive arrangement, just give some credit for that in the overall… I suppose linked to that, are you…?

Alison Carnwath: I agree. I’ve witnessed that too. Yes, I’ve witnessed that too. Not recently, incidentally; I haven’t witnessed that because I haven’t been in banking recently.

Q304 Julian Smith: My second question is: are you aware what your managers do, in the companies you are non-exec or chairman on, on keep-in-touch days and strategies to link in with women that may have gone off to raise children or whatever?

Alison Carnwath: I think on average everyone is very poor at that. I think on average, if somebody says they want to go because they “want to start a family,” and they may or may not come back, and eventually the legislation says they have to say, I think then the corporate moves on and says, “X has left. She was brilliant, but we’ve got to find somebody to replace X.” The alumni that exist in some organisations like McKinsey’s, for example, that doesn’t exist in most corporates.

Q305 Julian Smith: As a successful woman you’re not pushing that; it’s not something you’re driving into your executive team?

Alison Carnwath: No.

Q306 Julian Smith: No. My third question, final question is on employment law. Is there any advice you give, or the boards that you are on give, to managers to treat employment law in a common sense way, as it relates to keep in touch with women and having a positive dialogue with women who go off and raise kids? Rather than being very worried about all the mechanics of the law, do you give any advice?

Alison Carnwath: I think the employment law is unnecessarily complex in this whole area. That’s number one, but number two, I think if people want to keep in touch with people in an organisation they sort of do. If I take two or three people who have left Land Securities over the recent past, they’ve gone off to do other things, we were sorry to lose them. I might keep in touch with them, see how they’re doing. If you want somebody on merit in your organisation, male or female, you might keep in touch with them. Others in my organisation might too.

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Q307 Julian Smith: I contest that. I think that unless we have a board driving these things in a process-orientated way, we’re going to really struggle, because I think there are some companies that have a structure…

Alison Carnwath: You’re talking particularly about people who leave and need to be kept in touch, are you?

Q308 Julian Smith: The three issues I’ve mentioned. One: if we don’t have positive incentives to recruit diversely and have long lists that are diverse, I think we’re going to struggle if that’s not being driven by board level. I think second, if there’s not a process for keeping in touch with women at all levels of the organisation, by coming down from board level, that will become very ad hoc and just won’t really happen. I suppose that’s my view.

Alison Carnwath: Let me just try to turn this into practicalities. In terms of longlists, if you are going via…

Amber Rudd: He’s a former headhunter.

Alison Carnwath: Sorry?

Amber Rudd: He’s a former headhunter.

Julian Smith: We’re two former headhunters [laughter].

Alison Carnwath: Ah. Well if you are going via headhunters, seeking jobs these days at a pretty senior level – maybe people who are a couple of people below board level, because you haven’t been able to recruit internally – then most lists that headhunters produce and most managers recruiting will ask for a diverse list of people.

Julian Smith: I think what will happen is, and I contest your…

Alison Carnwath: I don’t think, I really do not think that incentivising one of my Land Securities staff, or giving them a credit for recruiting a woman is right.

Q309 Julian Smith: A credit for getting a shortlist in front of everybody that is…

Alison Carnwath: A shortlist, okay, yes. No, a shortlist, I don’t mind that at all; I don’t mind that.

Q310 Julian Smith: I think my point on the keep in touch is unless the board or somebody gives a budget for these things… What I’m talking about is some organisations will give a pot of money to have drinks or some sort of web funding for women to stay in touch, or technology for them to see emails while they’re off.

Alison Carnwath: Yes.

Julian Smith: I think it is a strategic decision that needs to be taken.

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Alison Carnwath: No, I’m not anti some of that. I am not “contesting”, in your phraseology [laughter]; I’m not contesting that. I think more effort could be put into that. Yes, I think that’s worth thinking about. As you’ve probably gathered, I think some good prodding by Government on this is good. It’s difficult to see how legislation could make this happen. I think it’s just the reality that the younger generation have got a better level of awareness of the necessity to have more diversity because they have worked in more diverse groups. You must remember that people like me, in the background I had, I was brought up in a completely male environment. I wasn’t really aware that it was completely male, because you didn’t really talk about it in those days at all. I would be so anti any policy at Land Securities which didn’t fundamentally say, “we only want to recruit the best people.”

Julian Smith: Yes, I agree with that.

Q311 Harriett Baldwin: May I pick up on an interesting statistic? You yourself have this characteristic, which is that you have a financial background; 65% of the FTSE 100 executive directors who are women also have financial backgrounds, which is quite a lot higher than in the rest of the male population of FTSE 100 executive directors. I just wondered why you think that is, because it seems quite a material difference. Is it because more women get financial qualifications, or is it because women are perceived to not be good at numbers and, therefore, need to have a financial qualification to be appointed, or do you just think it’s coincidence?

Alison Carnwath: I think the first thing is that boards of directors only have two executive directors on them mostly; some of them have three or four. They will always have a finance director, so that slot is always available. That’s number one. Number two, I think women are obviously as good as any man at being a chief financial officer or a finance director. I think – we’re getting on to behavioural characteristics of women in those places – they’re often very bright, particularly bright; probably brighter than their male counterparts. They often have a very interesting way of explaining and pushing across information, which the not-so-bright man may have difficulty with. I think that is an interesting debate in itself; it comes to the whole point of diversity – why is diversity important around a boardroom table, other than it’s fair? That is that women just have a slightly different way of looking at things. They push and prod at it, they ask very nicely, they don’t let things go. They aren’t ashamed, on balance, if they’re reached a certain level of seniority to ask both dumb and intelligent questions; they have by that stage got a very high level of confidence. I think some of that begins to explain that representation of females in a finance function. Of course, you go right back to their training; the accountancy firms, the big ones anyway, their recruitment is at least 50/50 women and men, so the start of the pipeline is there.

Q312 Harriett Baldwin: There are fewer barriers to making it to CFO if you’re a woman than there are to making it to CEO.

Alison Carnwath: There’s a proportion of CFOs that become CEOs. CEOs over the last 10/15 years have tended to be reasonably numerate people, but there are fewer women probably who come up through manufacturing, who come up through marketing. There are just fewer I think that have got to the top. There are some; obviously Angela Ahrendts is a good example. There are some, but every board has a CFO. Obviously every board has a CEO. I think what it proves to me is that women can reach the top as a CFO. It proves to me that able, smart women – they probably have to be a bit more able and a bit smarter, or they did – they can reach the top. This is seen by board members, particularly non-executives, as a very, very key position.

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Q313 Amber Rudd: Can I just ask you about this business of the addition of women onto board level, particularity at executive level, but also non-executive level, being such a benefit to boards? Because sometimes the reports are unequivocal, and some of them challenge that to say whether it actually adds commercial value. Certainly dispelling the whole group think that you sometimes get must be one of the benefits of having a woman on the board.

Alison Carnwath: Definitely.

Amber Rudd: Some of the comments regarding your role at Barclays were that you were able to have quite a different view to some of your colleagues, and that that might’ve been because you were a woman. It’s difficult to identify one’s own professionalism within being a woman or not, but did you feel that was part of it? You didn’t fall into the clubby male process of agreeing all the remuneration, shall we say, along one line?

Alison Carnwath: It’s amazing how you can leave Barclays, but Barclays never leaves you [laughter]. I was here last week on this subject.

Thérèse Coffey: Sorry.

Alison Carnwath: No, don’t worry, the line of questioning was a little different. I think the most important thing in terms of Barclays and my position there was that I was new to the board.

Amber Rudd: Right, so you hadn’t been indoctrinated.

Alison Carnwath: I think I’d be loathe to go on the record and say, “indoctrinated,” but I wasn’t part of this club that had been through the financial crisis at Barclays. I also was sufficiently experienced to speak my mind on this subject, but obviously incapable of persuading them [laughter] that they should reduce Bob Diamond’s bonus to zero. I am a pretty outspoken, confident person, so you might’ve got an outspoken, confident male who came in to chair the remuneration committee.

Amber Rudd: The point was you weren’t part of the gang.

Alison Carnwath: No, I wasn’t part of the gang; I never felt part of the gang. I think the moment a board feels part of a club then they’re doomed. They’re doomed, yes, exactly. I have been on record as saying that, if I can put this like this, “every board needs an S-H-I-T on it,” somebody who just doesn’t care a damn. Although they can be quite difficult to manage for the chair, I think they’re very important. Funnily enough I regard that as a diversity point on boards. One has to get away from group think, and everybody nodding and saying, “I agree with X.” Part of that is women being able to do that, and part of it is personalities, different personalities and different backgrounds being able to do that.

Amber Rudd: Thank you very much.

Q314 Thérèse Coffey: Your extensive financial experience, but also with your current one my expectation is you have a lot of dealings with the city?

132 Corrected Oral Evidence - Session 5

Alison Carnwath: Yes.

Thérèse Coffey: How much of a voice do you think investors have in companies? Are they increasing the pressure?

Alison Carnwath: Increasing. They are increasing their need. They are increasingly talking at differing levels to people in the corporates. I think part of this stems from the Stewardship Code. Because Sarah Hogg’s group basically has sought to begin to get better engagement between shareholders, to try to endure that shareholders voice their own opinions about things, rather than them necessarily going through collective industry representatives or voting agencies. I’m talking about the ISSs of this world, I’m talking about the ABI. The individual shareholders should try to find a voice, but they’re finding it difficult because it’s time-consuming. Most of them are there to be able to vote with their feet, so they can just come in and out of the stock if they don’t like what they’re seeing. Most of them haven’t got the wherewithal, the desire necessarily to set up big governance departments to deal with things like remuneration or nominational diversity issues. I have never, ever in my entire life in any shareholder meeting with my Land Securities hat on, been asked about diversity in the boardroom, never once.

Julian Smith: Never?

Alison Carnwath: Never.

Q315 Thérèse Coffey: That’s interesting. We had the European Managing Director of BlackRock and the Chief Exec of L&G, and it was very interesting. They took different views on this phase at the moment. L&G said, “we can’t actually sell shares. We run tracker funds.”

Alison Carnwath: That’s true. That is true of a tracker fund; that is definitely true, but they also have some discretionary fund management.

Q316 Thérèse Coffey: You’re right. They said they’re starting to make their decisions together. They have one decision for all their votes, so they’ve taken a much more proactive approach. Do you think that’s right that they should be doing that?

Alison Carnwath: I think they’ve got a very good man, Sacha, who basically has been funded to take the lead, in my view, of the British institutions, in the same way as Guy Jubb used to take the lead at Standard Life to try to deal with some of these governance issues. He’s got some good people working for him and he’s an ex fund manager, so he does understand the industry he’s coming from; he’s not coming from outer space to talk about governance. No, I think it’s good that a number of these institutions have decided to take all this seriously, but we’re now living in a global world with global investors. If I want to talk to an investor in Land Securities who lives in Dallas, Texas about the arcane remuneration structures that exist in the UK, he will just simply say, “I just will leave that to Joe” and Joe will probably be the voting agency. We’re early days on this whole stewardship stuff, but I think 22% of Land Securities’ shares are owned by UK long-end investors. Twenty years ago it would’ve been 50% maybe, thirty, forty years ago maybe even 60% or 70%.

Q317 Julian Smith: Another question on things you discuss at the board level, how often does childcare come up as a topic?

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Alison Carnwath: Never.

Q318 Julian Smith: How often does maternity pay, bonuses, compensation come up?

Alison Carnwath: Never, but I must tell you I don’t think we’re being derelict in our duties here as a board. This is mostly management stuff. I think your point is we should be prodding more about this as a board, and my response to that is, “we look regularly at succession.” That’s when we get to grips with the talent below board level, two or three levels below board level. I happen to have at Land Securities dinners regularly with the female executives, and I find that quite revealing actually.

Q319 Julian Smith: I think my point is I don’t believe the Government will actually achieve this; it has to be boards.

Alison Carnwath: Can you set out what you mean by ‘achieve’?

Julian Smith: What I think we all want to achieve on diversity I don’t believe will be achieved by Government; it will be achieved by companies and be achieved by the leadership of people in those companies. Whilst I understand that something like childcare or maternity pay isn’t technically a board issue, I think given this is such a running sore in UK PLC that we’ve got this pretty poor distribution of men and women at senior levels in companies, and particularly on boards, and we’ve got people like you who are very high calibre and able to ask the difficult questions, I believe that these issues need to be drilled down with from that level.

Alison Carnwath: Not from the executive boards but from the PLC boards.

Julian Smith: I think from all levels, but I think given that people like you really understand these issues, I think there does need to be a forensic dive-down, in order to give these matters more attention.

Alison Carnwath: Fine, okay. It’s hard to disagree with that [laughter]. I’m just simply saying that the boards’ agendas are busy. I’m not saying this isn’t important; I am saying the executives deal with it at Land Securities, and they report up in the context of succession planning, so that we know who’s in the pipeline. If I were to put on the agenda at the next Land Securities board meeting, and I might, I might and see what the reaction is [laughter]…

Julian Smith: One to follow-up, Harriett [Laughter].

Alison Carnwath: If we want to talk about childcare provision, I think everyone would look at Rob, who’s my Chief Executive, and say, “Rob, what are you doing about childcare?” Then he’d give a response.

Q320 Julian Smith: Fair enough, but I think between you you’ve also got to recognise that we’re pushing back quite hard, certainly Conservative colleagues pushing quite hard on an EU policy to have quotas. Because I fully agree with you, I don’t think we should have quotas. Unless UK PLC steps up much quicker to the plate, we’re going to have a problem.

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Alison Carnwath: Now, I think that is a real issue and I agree with that. What has happened to the EU quotas? Has is gone slightly quieter?

Thérèse Coffey: At the moment.

Alison Carnwath: It’s gone slightly quieter.

Q321 Harriett Baldwin: This Government’s approach has been to have the Lord Davies report, of course. One of the recommendations on the Lord Davies report was that companies do at least collect data in terms of their female pipeline and so on. You said that you are doing that.

Alison Carnwath: Yes, we do look at that now.

Q322 Harriett Baldwin: Could you share that data with the panel today?

Alison Carnwath: No, because I haven’t got it with me, but I could do. I could come back and show you.

Thérèse Coffey: Perhaps you could write to us.

Alison Carnwath: Yes.

Q323 Harriett Baldwin: Is it something that might be discussed in the board papers and, therefore, it might be something where you might set aspirational targets for changing those percentages at all?

Alison Carnwath: The most recent and relevant matter that was discussed at the audit committee, not at the board, would be in connection with a lady who is our Chief Financial Accountant below the Finance Director, who has chosen to work four days a week rather than five days a week. This means, of course, that she works five days a week.

Thérèse Coffey: But paid for four [laughter].

Alison Carnwath: But gets paid for four.

Harriett Baldwin: This is why I never do that [laughter].

Alison Carnwath: And is at home for the fifth, and definitely now thinks it’s much easier to be in the office than at home, but that’s how her life has been organised, so that she has to be at home on the Friday. I’m just making that point, because there would have been people in the organisation, in the finance function, who would have said – have said – “this isn’t fair. We’ve got to have somebody who is here five days a week. We’re always going to want to go and talk to her about something.” To which the response that most of the people on the audit committee would say, “grow up. You can get hold of people by email much more quickly than you can actually by going round to try to find them in their office. An awful lot of the questions you ask are capable of being answered in writing rather than having to talk. Surely you can organise any meetings she has to be present on a Monday to a Thursday. Anyway, incidentally, you over there, she’s bloody

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good and we don’t want to lose her.” Why am I giving you that explanation? It’s a live example of where there are… It would’ve been easy to say, “you’re absolutely right; we want somebody five days in the office, comes into Cannon Street every day, 9:00am until 6:30pm.” I think people are becoming more flexible, but I also agree that you’ve got to keep pushing. I’ve got to keep talking about it; I’ve got to keep insisting on certain things happening. Legislation, I agree, is going to be difficult, but the Government that keeps pushing and keeps getting it talked about, I think that’s incredibly important. I love reports being written, but how many reports have been written over the years when nothing ever happens? I don’t know what’s happened to the Davies report, but you’ll need stage two of it.

Q324 Harriett Baldwin: There was a report out by McKinsey at the end of last year; I don’t know if you saw it?

Alison Carnwath: I may have done.

Harriett Baldwin: The “Women Matter 2012” one, “Making the Breakthrough”. They said that if companies keep adequate data on their pipeline and monitor the data at the senior level, they’re two and a half times more likely to transform the company’s gender diversity.

Alison Carnwath: Yes and I can believe that. I can absolutely believe that, because that forces the company to keep talking about things and I think that’s right.

Thérèse Coffey: There is a possibility we may be recommending making companies publish that as part of their annual report.

Alison Carnwath: Yes, fine, I think that would be good. There’ll be an awful lot of screaming of course from companies, because a number of them won’t yet have got to the stage where they are keeping decent records. Actually I think that’s absolutely fine and I think I would be very supportive of that.

Q325 Thérèse Coffey: It’s interesting you’re having these dinners with people. I don’t have children, so I don’t have quite the same empathy as my colleagues here, who all three of them have children.

Harriett Baldwin: Mine became an adult this week, actually [laughter].

Alison Carnwath: That sounds like it’s a financial goal.

Thérèse Coffey: Some of the discussion we’ve heard from previous panels is that – how can I put it? – if you’re the Chief Financial Accountant you’re probably earning enough to not worry too much about childcare costs. It is expensive; we’re trying to do other things about that. These dinners you’re having with the female executives, are they at that level or are you seeing people dropping out? Is the attrition rate still high as they move from…? I appreciate your particular company at the moment, you were saying, has got a lot of professional people, so they come in and out.

Alison Carnwath: It’s interesting you raise that, because the answer to that is in terms of whether they themselves are having difficulties with childcare, or a lot of them have got home husbands or

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partially home husbands, we don’t really talk about that. We talk about Land Securities. I’m the Chairman, not the HR Director, but it would be an opportunity for them to raise these issues. They either choose not to or think it’s more interesting to talk about Land Securities.

Thérèse Coffey: Perhaps they don’t want to be seen as being too female.

Alison Carnwath: Possibly.

Q326 Amber Rudd: With the Chairman they want to talk about Land Securities; I can see why. What is your view? A couple of witnesses have said that the cost of childcare is absolutely prohibitive to women, however well they’re doing, mid/late 20s or early 30s to actually staying on, even if they might want to. Somebody quoted £85,000 of your gross income; somebody else said £65,000, whatever. If you haven’t yet become Chief Financial Officer, it’s a chunk of change. Do you think that puts some people off and contributes to women dropping out of the executive pipeline?

Alison Carnwath: Yes, I do. Yes and it’s been much talked about, about how this can be improved, workplace nurseries –I don’t know what the statistics are, but I shouldn’t think there are very many companies that have them – setting it off against your tax. I think there are solutions to this.

Thérèse Coffey: There’s stuff Government could do on that line.

Alison Carnwath: That is something Government could do, yes.

Q327 Julian Smith: Do you know what the drop-off rate is, Alison, in women of late 20s, early 30s? Because if you look at the…

Alison Carnwath: High, very high. You never quite know, because you never quite know whether they’d have made it much further. It’s difficult statistically; it’s one of these numbers you can manipulate the way you want really, but I think it’s high. Banking it’s incredibly high. I remember talking to the ladies at Barclays, about 80 or 90 of them of the investment banking side, and they said, “it’s worse now than it’s ever been.”

Amber Rudd: That is so interesting, because direction of travel is so important.

Alison Carnwath: Yes, it is and that was deeply depressing.

Julian Smith: Because I would contest that it’s only…

Thérèse Coffey: He’s contesting again [laughter].

Julian Smith: Sorry, I’m contesting.

Alison Carnwath: I’m definitely going to pick this expression up [laughter].

Q328 Julian Smith: You can’t pick on me; it’s so sexist [laughter]. I don’t think it’s just about money. I think that as well as the financial aspect there is the conflict that women at that age have, if you’re having a child and then you’ve got a career, and how you’re going to manage it.

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I think then that comes back to the policies, or expectations, or flexibility that the workplace has to actually allow people to do both.

Alison Carnwath: I agree; it isn’t just money. On the other hand, your life is never quite as you think it’s going to be if you are in a workplace. If you are paying for a nanny and the nanny collapses in a heap, or she can’t come in one day, at the end of the day somebody has the have the flexibility to be off work for four or five hours more. Husbands and home husbands aren’t always very sympathetic with all of this. This isn’t a general comment, but everyone is involved in trying to ensure that the wife or the partner is working. Everyone’s involved, because everyone has to make some sort of sacrifices and expect the normal systems sometimes to go awry. I do think the Government could do something in this area. It’s all to do with what it costs, I’m sure of it; I think they could.

Q329 Harriett Baldwin: What would you do?

Alison Carnwath: I think a sum of money – I think it has to be a sum of money, it can’t just be care – a sum of money can be set off against that person who is working tax.

Thérèse Coffey: Tax breaks for...

Alison Carnwath: Maybe £20,000; I don’t know, you know all the numbers.

Amber Rudd: It’s got to be significant enough, yes.

Alison Carnwath: Anything is better than nothing at the moment. It’s not quite the climate for this sort of thing, I realise that.

Q330 Thérèse Coffey: You broke through the glass ceiling yourself in banking. You probably made that way yourself, but are there initiatives that in hindsight you felt you wish you had, you saw that other companies that you now are non-exec of do that you’re thinking, “actually, that would’ve made it easier, that were good practice”?

Alison Carnwath: Talking about it a bit more I think in this day and age is important. I don’t think it mattered in my day, frankly. I had very enlightened bosses, I was lucky; that’s an important point, enlightened, not stodgy bosses. The sorts of conversations that those bosses would have with me might be incredibly offensive to certain females today. For example, I was in the client business, so I have clients who were large companies, mostly men. Occasionally they would say to my boss, “we think Alison’s just terrific, but we just simply can’t really take her advice. Sorry, I can’t do it; I really can’t, we need a man.” Today that would be a dreadful thing to say. Thirty years ago I didn’t take any offence at that at all; I completely understood. There’s a certain sensitivity that’s crept into all of this.

Q331 Thérèse Coffey: You didn’t feel that the lads going off shooting or…?

Alison Carnwath: I shoot.

Harriett Baldwin: Golf.

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Alison Carnwath: I play golf.

Harriett Baldwin: You see those are two tips.

Thérèse Coffey: Do you enjoy them or is it networking?

Alison Carnwath: No, I love them. Actually I shoot far less now; I’ve sort of gone off shooting. This is very anecdotal, but it’s true; I remember going off to the Schroder’s golf day at Swinley Forest. Are any of you golfers? This is a very snotty sort of club down in Surrey. I was a Director at Schroders and I went down there for the golf day, which was a very splendid day; we had all our clients’ chairmen and CEOs there. Of course, they didn’t have a ladies changing room, because this was a male only golf club. I was ushered into some broom cupboard with the cleaning ladies’ stuff [laughter]. Today there would be a proportion of females who would get really upset by that. You just had to laugh.

Thérèse Coffey: I think people would check though in advance, don’t you think?

Alison Carnwath: Maybe, yes. No, but this golf day had been going on for years.

Q332 Harriett Baldwin: This is a serious question; do you think that being able to play golf and being able to shoot has actually helped your career?

Alison Carnwath: To the extent that it meant I wasn’t excluded from things.

Julian Smith: What do you play off?

Alison Carnwath: Badly, 22.

Thérèse Coffey: I don’t know if I think that’s relevant [laughter].

Q333 Julian Smith: Do you look at this sort of conversation, Alison, and think, “I have achieved this really without…”? It looks as if you’ve done it without too much problem and you’ve achieved a great deal, and think we’re all off our politically correct rockers.

Alison Carnwath: No, I don’t think you’re off your rockers. Do I think you’re off your…?

Julian Smith: Yes, do you think we’re being too… Because you’ve achieved this without any of these…

Alison Carnwath: No, I think it’s a real issue. No, no, no, I do think it’s a real issue and luck must’ve played some of my part. I trained in a firm where it was 50/50 male/female; I was very lucky at Schroders, the people there were very enlightened. At Land Securities we ran a competition, or the Senior Independent Director ran a competition to select the next chairman, and it was myself and two men; it’s fine. No, I think it’s a real issue. There is this whole question about if you talk about these things too much and don’t do enough, the whole subject gets rather stale. At the moment we are doing a lot of talking about it, and action, and tangible evidence and results, that’s more difficult to come by. The statistics are difficult, because you’ve only got to lose Marjorie Scardino, say, and suddenly the statistics all look wrong again.

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Q334 Julian Smith: I think just my experience of headhunting was that it was only those companies that had leaders, whether on the board or the executive, who drove this agenda that actually got change.

Thérèse Coffey: Like the new Chief Exec at Barclays. Barclays is very positive about this.

Julian Smith: Yes, who’s very good. Yes.

Alison Carnwath: Yes, Antony would be very positive on it, because in his retail bank of course he employs an awful lot of women. These are women who really do need childcare. The retail bankers, even if you get to quite a serious level in a retail branch, you’re not paid a lot of money. It’s hard to say that at Barclays, but you’re not paid a lot of money in that.

Thérèse Coffey: Unless there’s anyone else, I have a last question. Any others?

Q335 Amber Rudd: Just on the whole issue of the direction of travel, are you optimistic that we are making progress, that we are getting change?

Alison Carnwath: Yes, I’m optimistic that we are, but I think the rate of change has got to accelerate.

Julian Smith: Yes, absolutely.

Alison Carnwath: I think there’s a danger that, for the reasons I’ve given – that we talk about it but what action is there, what policies are there? – there’s a danger that it may start to go backwards. There’s a danger.

Q336 Harriett Baldwin: My closing question then is: do you think the business case for greater gender diversity has been effectively made?

Alison Carnwath: No. No, I don’t.

Q337 Harriett Baldwin: Can you think of examples in which Land Securities would be a stronger firm if it had been more diverse throughout its history, or examples like that? Or is it just anecdotal?

Alison Carnwath: I think there are plenty of academics who are trying to prove this. Susan Vinnicombe is trying to do this sort of stuff. I don’t think it’s completely proven yet. The way I look at it is that the debate around the boardroom, I think, is much more diverse if it isn’t all men. Whether that’s because there are women, or whether it’s because you haven’t just got a herd of likeminded men, it’s difficult to know what the cause and effect is. At Land Securities there are two of us on the board and we will appoint one more this year, who will be female. It’s made a difference to our debate and the way we debate things, but I don’t think it’s proven. I don’t think it should be proven either; I think we’ve just got to give this more of a go.

Q338 Thérèse Coffey: I think with McKinsey, some data was released inadvertently, wasn’t it, at one of our last sessions? It is interesting to hear you talking about banking going backwards. They said actually “law firms is where it’s the worst.”

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Alison Carnwath: Law firms is where it’s the worst?

Thérèse Coffey: It’s a disaster for women getting to partner level.

Alison Carnwath: You should talk to Caroline Goodall. She was a corporate partner; she ran the whole corporate practice at Herbert Smith for many years. I remember her telling me that when she retired from that job, three men had to fill it.

Amber Rudd: Two men what?

Alison Carnwath: Three. Three men had to fill it [laughter]. She’s just chosen to go the non- executive route in her life and she’s just gone on the board of Next. She’s worth talking to.

Harriett Baldwin: Great. Thank you so much.

Thérèse Coffey: Yes, thank you.

Alison Carnwath: Can you keep me in touch, because I’m interested, obviously?

Thérèse Coffey: Yes and don’t worry, we won’t be contesting you any further [laughter].

Julian Smith: Sorry about that, yes.

Jo Swinson MP, Minister for Women and Equalities

Thérèse Coffey: Jo, thank you so much for coming along. You will know quite how busy the Women on Boards agenda has been. It’s actually a very crowded sphere; a lot of data support has made a significant difference, threats of quotas, threats of regulations. We decided as a group of women MPs to take a step away from the non-execs, where there’s been a lot of progress. Execs will only come through external recruitment or people coming up. We’re looking at what can we do to grow the pipeline of talent? That’s our angle. I don’t know if you know this, my previous life was for a short time I worked at the BBC, but I spent 12 years working in Mars in finance roles. Do you want to say?

Harriett Baldwin: Yes, thank you. I’m the MP for West Worcestershire and before that Managing Director at JP Morgan, where I led a lot of the initiatives that they had in the firm on diversity.

Jo Swinson: Brilliant.

Thérèse Coffey: Amber do you want to say what you did?

Amber Rudd: Yes, immediately before this I was in headhunting, and before that originally I was also at JP Morgan, but I left to go into venture capital before getting into headhunting.

Q339 Thérèse Coffey: Should we just kick off with: is the Government satisfied with the way senior appointments are made, following the changes proposed by Lord Davies, things like the voluntary code for executive search funds?

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Jo Swinson: Is this senior public appointments?

Thérèse Coffey: Both private and public. Public appointments as well, because we know that some of the departments are doing better than others.

Jo Swinson: That’s very true. I think, first of all, Lord Davies’ approach is proving very successful. I’m very confident it’s the right way forward, because what he has been so successful in doing is getting genuine buy-in by personally going and speaking to the FTSE 100 chairmen. That has been coupled with a great amount of momentum from organisations like the 30% Club, Helena Morrissey and so on, and a whole range of people who are working very hard on this. That has been really delivering very well on the non-exec directors. Since last March, 38% of FTSE directors who have been appointed have been women. Although the overall percentage is around 17%, obviously because of incumbency and turnover, I think the most useful figure to look at is what about appointments that are currently being made? That’s where we’re getting to 4 in 10. Of course, as you say, there’s a big difference between the non-execs and the execs. I think the approach is working, but we need to put a lot more focus into the executive route, and that’s why I think this inquiry is a really useful piece of work. Then in terms of diversity in public appointments, I will certainly say to you that in BIS this is something that I take every opportunity to promote, including looking at the diversity stats for longlists and shortlists. I know the Cabinet Office is leading work on this as well, because there is an ambitious target for 50% of public appointments to be women by the end of this parliament. I think that that is ambitious, but it’s something we need to keep pressing ahead on, because it has so many overlaps into different bits of life as well. The people that get asked to lead a review for the Government into something, they later get asked if they’ll join a board on something. Then they’re on one board and then they get asked to do a different board. We need to be making sure that all those entry levels as well that we need to consider diversity.

Q340 Harriett Baldwin: Jo, in welcoming that wonderful news that you’re taking such a proactive role on it, my obvious concern is that if you’re having to do that then it’s not necessarily happening at ministerial level across Government. To what extent are you able to influence your colleagues on this?

Jo Swinson: I think that’s a fair question, because I don’t think this is as routinely happening everywhere as it should be. Therefore, I think in BIS I’ve been able to raise the profile of it so that it can be considered more widely, but that’s why I think the Cabinet Office at driving this is also really important. They have a unit now working on the public appointments and particular focus on diversity. I’m going to be meeting with them in the fairly near future, to support their work to drive this across Government. Because as a minister in one department I’m not going to be able to do that, but the Cabinet Office does have the networks, being at the centre, to be able to do it. It is the Prime Minister who made that commitment, so they’ve also got that political backup in order to be able to drive that through. Simple things, like looking at departments; as you say, they vary hugely in terms of their nominations, and which ones are doing well and which ones aren’t, and questions being asked. All of those things help to drive the system, to make sure it’s properly considered at an early enough stage so that you can change the outcomes.

Q341 Thérèse Coffey: It was interesting to hear what you said about now you get the longlist stats and the shortlist stats. Are there any measures the Government, you feel, is taking, any training about recruitment?

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Jo Swinson: There probably are things that I’m not aware of, but certainly within BIS there is also an equality and diversity advisory group. I’ve possibly got the name of that wrong, but I can picture the people, who are external to the department. They meet on a regular basis, and they consider different things the department is doing and how equality is being worked into that. One of the things, for example, there’s a leading expert professor on there, who is the expert in unconscious bias. They’re running training for senior civil servants on that, to help those ideas to filter down. Because I do think that although there is still some sexism that exists just as pure misogyny or sexism that is out there in society, I think increasingly a lot of what we’re getting to is people who are very positive about equality and women. It’s not anything that’s necessarily intentional; it is just that they do not think, “actually, this is a list that’s just got men on it. That’s a problem and I should raise that.” I think it’s about helping people to understand those unintentional things which happen, which actually do mitigate against women being able to play a full role.

Q342 Harriett Baldwin: This unconscious bias expert, who sounds a wonderful person, are they doing anything to train across the whole of the civil service or across departments?

Jo Swinson: I know that DECC and FCO have also undergone this training. I don’t know if it’s with the same individual, but I know that they have done this and it might well be with the same individual.

Q343 Thérèse Coffey: Out of interest, have the ministers done it?

Jo Swinson: I’ve suggested that they do. I think it would be fascinating, apart from anything else, to have that kind of training. I’m going to do it, but I don’t know if others have said they can.

Harriett Baldwin: We used to do it at JP Morgan. It was one of the most successful initiatives that we rolled out, because it really did wake everyone up to their own particular biases on a whole range of issues. I think it was the single most effective thing that we did.

Q344 Amber Rudd: We’ve received mixed responses to our inquiries about childcare. When I say, “mixed,” most of it but not all of it has said that “the costs of childcare are one of the key factors that mean that women executives leave the pipeline.” If we’re looking at women becoming executives on big companies, by the time they actually reach that level they’re probably on sufficient amounts of pay that they can pay for quite expensive childcare. The problem is when they’re in their 20s or 30s and they’re earning a more modest salary, then the cost of a full-time nanny - which somebody estimated was £85,000 gross of your income, but it could be £65,000. What’s your view on that, Jo?

Jo Swinson: I have the same concerns that the cost of childcare is a big challenge. Very many people that I meet in my constituency, and indeed if I think about friends and relatives that I know that have children, this is something which is a massive, massive challenge for families. Particularly if people are having more than one child, just the basic economics of going out to work. It probably often might work when you’re paying for childcare for one child, and then when you’re having to do the cost of two then so many people just suddenly… I know friends who have said, “actually then it didn’t make sense to go back, because I would’ve either been paying to go to work or working for free.” Of course, that’s fine if people want to make that choice, but if people are forced into that choice when actually they would like to maintain their career development and confidence in the workplace, those are more worrying issues. Obviously some of the things the Government has already done, in terms of extending the free entitlement to nursery, or early years education for three- and four-year-olds, and indeed increased free entitlement for 260,000

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of the most disadvantaged two-year-olds, certainly helps. That still leaves you this gap; if people take a year’s maternity leave, that still leaves you one until two, even if you are in that 40% that then gets some provision at the age of two. There is support also through the tax credit system, but there is a big challenge there. That’s why the Government is looking at what we can do, and hopefully there will be announcements forthcoming. Of course, Liz Truss’ programme, I think particularly around making it easier for more providers to enter the market, particularly in terms of child-minding, so that people don’t have to be running their own business. They can register with an agency who will deal with a lot of that bureaucracy, training, form-filling, much of which is necessary for a reason, particularly when you’re looking after children, but it doesn’t all need to be done by that individual who is doing the caring. That will help.

Q345 Amber Rudd: There is quite a lot of support in the tax credit system, is there not, if you’re not earning more than £35,000 or something around that level? Do you think it is taken up by women or families in sufficient numbers to make it useful to them?

Jo Swinson: I think there is support there, but it is very, very expensive. Even the support that is available in itself is not necessarily sufficient. Obviously it’s not as if Government is in a financial position to just say, “just make childcare free for everyone.” We do need to look at what is possible within the constraints of the overall economic situation. I do think because of the impact that giving more support to childcare can have on the wider economic benefits of using the talents of predominantly women – men too, but it’s more often women at the moment who are not working as a result of this – then that is a very strong case, even in these difficult times, for finding additional resource for that.

Q346 Harriett Baldwin: I think that number I quoted this morning in business questions on income tax paid by men being £92bn and income tax paid by women is £36.8bn, just made me think, “that’s a £55bn difference.” If you could tackle that it would just pay for itself. There have been studies in places like Canada, where they’ve extended free childcare for pre-schools, for parents who want to work, so no deadweight cost. They’ve found that they got back more than it cost to provide that. If there’s anything we can do to help with this report to substantiate that argument, it’d be really interesting.

Jo Swinson: I think looking at evidence like that sounds very, very interesting, so hopefully the report will be able to be a good, useful voice in the debate.

Q347 Thérèse Coffey: It’s perhaps serendipitous today was the great announcement. What impact do you think our marvellous policy will have on the pipeline talent? I’m talking about shared parental leave.

Jo Swinson: Yes, this week. It was published on Tuesday; the bill was published. I think this has huge potential to make a difference, although the change in legislation on its own is not going to do it. We also need to make sure that we achieve the culture change at the same time. This is about saying, “it’s up to families how they decide to split looking after their child after the baby is born.” It isn’t just mum’s work. Of course, absolutely many mothers want to be spending time with their new-born babies, and that’s absolutely natural, but many fathers do too. The way in which they decide to do that should be up to them. There are many couples, increasing numbers of couples, where the woman does earn more, so the economics for that individual family decision are very different to the traditional model. I think overnight change is not going to happen as a result of this, but the quicker we can all look at ways of changing the culture, the more impact this

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measure will have. I would say that I think we as MPs…I was recently just earlier today speaking to the Chartered Institute of Personnel and Development about what they can do, because it is a culture of our society. I don’t know about you, but I think men often in the workplace will feel less empowered to ask for time for going to pick up their children, having additional parental leave. Whereas women it is seen as more accepted, because in society it’s seen that that’s what mothers do. That can be negative for mothers but it can also be negative for fathers. I think changing that culture is a big challenge. For example, I don’t know what the whips are like; do they treat mums and dads differently with the same parental requests? I would like to think so, yes, but I don’t know if, even in this place, whether I have my sneaking suspicions that there might be rolled eyes at a man, when there might not be the same rolled eyes at a woman.

Q348 Harriett Baldwin: That hasn’t been my experience, to be fair, but I think that there’s another advantage that I wondered whether your department had done any work on this. There can be an unconscious or perhaps even conscious bias, particularly in a small firm, to hiring a recently married woman of child-bearing age, and that perhaps that prejudice that perhaps prevents women from being offered opportunities might also be tackled by this shared parental leave? Did the department do any work on that?

Jo Swinson: I think that’s a very happy by-product for this. There is evidence that there is maternity discrimination that goes on in society, whether that’s in the recruitment process or indeed, sadly, even once people are in work. Again actually, the cultural change that we secure, the quicker we secure that change, the better that benefit will be. Because until there is more of an expectation that men can take significant amounts of time off after a baby is born, then that bias could remain. Even though obviously it’s illegal to discriminate on that basis, it can be very difficult to prove. The more that we get to that point, where people think that a man or a woman who might have children might be taking time out, then at that point the discrimination makes much less sense.

Q349 Thérèse Coffey: Jo, sorry, I had one more question in my mind that now escapes me. I’ll ask a slightly different question, which was about you are on the Speaker’s Council as a Member of Parliament, trying to get more women. You are a junior Minister but tipped for the top; you don’t need to comment on that. What’s the pipeline of talent? What can we do as parliamentarians, in our own pipeline of talent, to achieve the ambition to have more women in Cabinet? Because at the moment there aren’t any Lib Dem ladies.

Jo Swinson: Indeed. What?

Thérèse Coffey: Sorry, Amber was laughing at me for using the word ladies, sorry; women.

Jo Swinson: Women in cabinet. No, indeed; one of the first things I would say is that I, as Equalities Minister, I do say, “I would like to see more women in cabinet.” Of course I would, but at the same time, when I get asked to be very critical of the Government, I do point out that the Prime Minister and Deputy Prime Minister didn’t have it easy. If you think about although we have many more women MPs now, many of those were elected in 2010. It’s not really surprising that they’re not in cabinet yet, because I don’t think there are men that were elected in 2010 that are in Cabinet yet either. I think that context is important when we do, as sometimes happens, get overly criticised on that but, therefore, that pipeline is very important. I think there are Ministers, particularly those who were promoted in the last reshuffle, across a range of different departments – from the 2010 intake obviously you’ve got people like Chloe, who was promoted in the reshuffle before that, and people

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like Anna Soubry, who I think is doing a fantastic job in the Department of Health. People like Liz Truss over at Education, Helen Grant, my fellow Equalities Minister. I think there is increasingly... I think, if I may say so, amongst the PPSs that are in place, there genuinely is a pipeline of talent within Parliament, but we still have far too few women even in parliament. We all still need to continue in the work in our own parties to get more women to think parliament is a place for them, it’s a job they would like to do and that they would enjoy, and that politics is something that they should turn their talents to. Because I’m sure you come across them as often as I do, fantastic, wonderful, talented women who’d be brilliant MPs, who run a mile from politics, because a whole host of reasons. Culturally what is required in terms of personal sacrifice to get elected, the impact on family, the fact that they can do other things. Indeed, some of those confidence issues, or that fact that it can cost a lot of money to actually get involved in politics, particularly if you’re actually going to fight seats and have to fight several seats in order to get selected.

Q350 Thérèse Coffey: Out of interest, did the Speaker’s panel simply look about getting more people in the door, or did it look at people who chose to leave? You know, Ruth Kelly…

Amber Rudd: Estelle Morris.

Jo Swinson: First of all the Speaker’s Council focused on Parliament rather than Government, so it was focused on getting more women, black minority, ethnic and other under-represented groups MPs. We did speak to some people who had left Parliament. I’m trying to recall, because it was a few years now. I think actually we spoke to Julia Drown who had left. I might be wrong on the name there, but we did actually look at that. Obviously Ruth Kelly stood down, although she had been an MP for slightly longer.

Thérèse Coffey: She did make it pretty high up.

Jo Swinson: Yes, exactly. She had served in Cabinet and so on.

Thérèse Coffey: She had four children.

Jo Swinson: She had four children. I think it is true, some women MPs stop, but I think that getting people elected in the first place is much more of where the challenge actually lies. Clearly your party has made great strides in the last election.

Thérèse Coffey: We’re going to try and keep going.

Jo Swinson: Absolutely.

Q351 Amber Rudd: Do you share my concerns about also getting more women councillors in?

Jo Swinson: Yes.

Amber Rudd: I find – I don’t really have the same situation – once locally you get a very male dominated council, it becomes completely self-fulfilling. None of the women want to come in, because they see it as entirely male, which is what it’s becoming. It’s really difficult, once the rot starts, to crack it open again.

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Jo Swinson: It works the other way though as well. We had this for a while when we were running Islington Council, and they made it such a real passion that they would go out and recruit candidates. They had such a diverse range; it wasn’t just men and women, they had different ethnic groups, they had different socio-economic backgrounds. They had a really, really good diverse range of councillors, because actually somebody, the leader, had said, “this is going to be really important when we’re recruiting our candidates, rather than just looking for somebody that looks like me.” I totally agree that it’s about all levels, because you can’t just fix the top with a sticking plaster, and it’s the same about women on boards. Actually part of the problem in politics is not just that MPs are overwhelmingly male, but it’s also that party agents, and organisers, and councillors, and the people who speak at conference… I don’t know what it’s like in your party, but although we have chairs that will try to gender balance the debate, with cards that are put in for people that want to speak, there are still whole debates that go by sometimes without one woman speaker. That in itself is one of those things and I think from a very, very early stage. I even find when I go to schools in my constituency and ask for questions, it is overwhelmingly the first question will come from one of the boys. I think we do need to start to address some of these issues very, very early on and recognise also that, partly as a result of society, women will often need more of a nudge in terms of getting them actually involved and putting themselves forward for election than men do. That isn’t about saying, “they’re clearly not as keen.” Actually that’s just about recognising the way it is.

Thérèse Coffey: Before we head back to boards, I think Harriett wants to talk again about Government setting an example.

Q352 Harriett Baldwin: Yes, just about civil servants really, because obviously there’s been a certain amount, particularly at senior level, of attrition in terms of the number of Permanent Secretaries who are women. I just wondered what you see in your Department or across Government, in terms of approaches to tackling diversity across the Civil Service? Obviously more men, for example [laughter].

Jo Swinson: Yes, exactly. I think I’ve been quite pleasantly surprised actually of how it is in BIS, although the Permanent Secretary is a man. If you look at the Director General level, then it’s pretty much equal; I think it is equal between men and women. In terms of the Director level below that as well, there is a very good mix. The other thing is, and I’m sure it’s related, there generally is a lot of flexible working. I’ve got various senior civil servants that I meet on different policy areas that I look at, that work Tuesday to Thursday, or Monday to Thursday, or a different pattern. It doesn’t get in the way of them doing an excellent job, and it isn’t seen as anything weird in the Department; it’s just quite normal in the culture. I actually think in BIS it seems to be quite positive, but obviously I am aware of the figures in terms of Permanent Secretary level. At one point it was really very positive, and there has been several appointments recently where women have left and been replaced by men. That isn’t necessarily a sinister thing that’s happened, but the way that that has worked out can therefore lead to people saying, “hang on a second, how male is the Civil Service?” I think it’s a good challenge in terms of what the Civil Service does, because it affects the lens through which we’re making all of our policy decisions. I do the same not just in the Civil Service but in the party. When we’re having meetings where there are 12 men and 2 women in the room, you’re probably not going to get as good a range of different viewpoints and perspectives as if you had a more diverse group of people throwing round that particular issue. I think that does always need to be challenged.

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Q353 Thérèse Coffey: This is slightly anecdotal but I’m very interested to hear what you say about the flexible working and the different part-time levels. Some companies might say, “we can’t really afford to do that. You’re the Government, you’ve got all the time.” Forgive me, you haven’t been in the Department all that long, but from your perspective so far do you notice any difference? Does the Equalities Office do any comparisons about productivity?

Jo Swinson: There is some good evidence on flexible working, but I think actually some of the figures speak for themselves. Three out of five requests that are made for flexible working are granted immediately; another one in five is granted after further discussion. Actually most requests can be met by businesses fine. I can remember the exact statistic, something like 87% is in my mind, I think, of businesses that offer flexible working actually just offer it to all employees rather than just to the current groups that are covered, in terms of people with children and these different age levels. In fact, the overall impact of flexible working on the economy is positive, because you are better and more efficiently using your talent. If businesses say they can’t afford to do it, it’s possibly also the case they can’t afford not to do it, because they have talented members of staff. If those talented members of staff are want to work in a particular pattern, then they may well choose to go elsewhere. I think many businesses actually see it as quite an advantage that they are able to retain and keep very well-motivated and productive, very talented staff. BT, who are excellent leaders in this field, now have a culture where it is just the norm and 80% of their staff work flexibly. Of course, many small businesses do it too.

Q354 Amber Rudd: I just think there is a big difference in how small businesses and large businesses are able to do this. Large businesses tend to take the view that maternity leave is a good thing, because they get to try out somebody else in the role, they can hold it. They’ve got so many people, it’s part of the whole process that it’s not anywhere near as much as a headache it is for a small firm to deal with. I just think that we need to be sensitive to the fact that small firms with five, six, seven employees, that sort of level are struggling much more. Not so much with the cost, but with the absence. It’s just the requirements that we put on big firms seem entirely appropriate, but on small firms sometimes looks overwhelming.

Jo Swinson: I think there are two separate issues here. One is flexible working and one is maternity leave or shared parental leave. On flexible working I think that, apart from anything else, it’s only a right to request. It’s right to have the discussion, which in small businesses anyway probably is already happening. Actually I think there’s an argument even just as a small employer, as it were, running a constituency office. When I have a member of staff that wants to come early and leave early, and another member of staff that wants to come in at half past nine and leave at six, actually I get a benefit from that. Although they’re getting the pattern of working they like, I also get more hours in the day where my phone will be answered. I think in terms of flexible working very often there can be a genuine business benefit. Of course, if there’s a business need for it not to happen, then of course that is perfectly okay for the employer to say no. I think on maternity and indeed parental leave, yes, of course there’s an inconvenience. Of course it is inconvenient when somebody suddenly is absent for a significant amount of time actually, whether that’s maternity, or they break their leg, or they have a car accident, or whatever it is. We live in a society where we need to keep having children – and we’re not going to stop doing that, otherwise we have problems – and where we cannot afford in our economy to only use the talents of one gender. It’s inconvenient when it happens, but we need to just find a common-sense way in which it can work. I think there is also a real benefit there. Somebody who is starting a family, if their employer, within the bounds of what they’re able to do and what’s reasonable, has a positive approach to them – and actually many small businesses do this very well indeed – and they work

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out something, an arrangement that works, then very often that employee will be even more loyal and productive, and really appreciate that employer. It helps that whole relationship. One of the most interesting statistics that I’ve found in this is the difference between whether or not a person returns from maternity leave to their employer, to the same employer, it varies from 50% to 99%. There’s an inconvenience, yes, in arranging cover, but if you invest in training somebody already and you get this right, you get a really high retention rate. Actually get it wrong and you incur potentially loads of extra costs, because they go elsewhere.

Q355 Harriett Baldwin: Isn’t there also the point with shared parental leave that you have to include all firms? Because otherwise you might have one person in the couple working for a big firm, and one person in the couple working for a small firm.

Jo Swinson: Yes and obviously the thing with maternity leave, for very physical and biological reasons, you can’t say, “you can’t have maternity leave; you’re working for a small company.” I also think if you do that, then you start to give small employers almost a bit of a bad name. Because as I say, many of them are very, very good at doing this already, because they have a very flat structure, if you like, in terms of hierarchy and they have these discussions. Yes, there’s no two ways about it, if you’re running a business with five people and somebody becomes pregnant and is going to be out of the workforce, and they are a talented, valued member of your team, there’s going to be an inconvenience in replacing them for that time.

Q356 Amber Rudd: I just think that word “inconvenience” does trivialise something, which if you’re running a business… Nowhere in that response have you talked about the business of profit and loss, because it’s not how we run our constituency offices. We can run them on our timing but there’s no profit and loss. There’s no actually having to earn the money back in on the other side; we’re only running one side of it. I just think that we have to be very aware that people running small businesses like that, they might have mortgaged their houses, they’re working every minute that is on the table there. You’re not talking about inconvenience; you’re talking about sometimes life or death to them almost, in terms of whether they lose their house, their businesses. It’s not a trivial matter, which I’m afraid the word “inconvenience” slightly suggests to me. It’s a really important way of trying to make sure that these businesses scale up. I do think, in the Government’s favour, that the whole business of having maternity and paternity leave fungible is a fantastic way of mitigating against that somewhat. And also makes sure that when employers look at making their sixth or seventh recruitment, they’re less likely to feel quite as anxious, as they quite legitimately would do, about recruiting another woman under 30. Because they’ll be able to think there’s potential that they’re not going to take the maternity leave, the man might take it; there’s just more flexibility here, which means my business is going to live another year. There’s just more going on here, I think, than inconvenience.

Jo Swinson: I take that point and it is incredibly difficult when that happens, but of course, as you say, this gives extra flexibility. Where that member of staff is a woman that is pivotal to the whole business, and may well be earning more than her partner, then yes, she will probably still take some time because of the physical experience of having birth is one which is not easily… She has to take at least two weeks by law. The point at which she may return may be much quicker, or indeed a more flexible system that works for both.

Thérèse Coffey: Ironically perhaps, I’m one of the few MPs who opposed the IPSA allowance to allow maternity contingency. When I was managing my team I used to assume – I had in my bigger team 12 women and 6 men – I’d assume at any one point in time 2 of them were on maternity leave. I had to pay for extra people to do it. I just forced myself to budget that.

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Amber Rudd: You budgeted anyway?

Thérèse Coffey: Yes. Then if it didn’t happen we had a better Christmas party [laughter].

Q357 Amber Rudd: What Government is often criticised for is wanting to make the law so that it is absolutely fair, which we all want, but sometimes forgetting about the costs. We must obviously make that, as I’m sure you do, an important part of what’s possible.

Jo Swinson: Indeed.

Q358 Thérèse Coffey: Quotas. Our policy as a Government is not to have them, to oppose the EU’s direction of travel on that. You can answer this personally, or you can answer on behalf of the Government, or both: do you think quotas will have to come in, in order to accelerate the change?

Jo Swinson: I think probably not. I’m not a big fan of quotas. I opposed them in my own party in terms of candidate selection. I can understand that in some cases, if we think about the candidate selection, if there is sexism in the selection process then maybe that’s the only way that you can actually deal with it. If you can’t apply normal employment law to candidate selection because you’ve got lots of people voting, and so everyone’s not filling in a thing to work out whether or not they’ve done that on a proper basis. I can understand the logic, but I don’t think it’s the best way to tackle the problem. Certainly on boards I think that what we are seeing, in terms of the progress through the approach of Lord Davies, is much, much better. And more genuinely bought into the result that is needed and so, therefore, more likely to be successful in a sustainable way.

Q359 Thérèse Coffey: Do you not think he’s rattling the cage a bit with the threat of regulation? Do you think that’s a credible threat?

Jo Swinson: I think it is a credible threat. I also think the threat of regulation can be a hugely useful motivator. I think that it actually will often make the urging of the approach that we are taking more successful. I don’t think it’s the best way to proceed, but I do think that keeping that as an option that is open for the future, if this is not successful, is a sensible way forward.

Thérèse Coffey: Jo, Minister, I’m conscious it’s four o’clock. Are there any last questions, Harriett, Amber, you would like to…?

Q360 Harriett Baldwin: Are there any points you would like to make that you feel we haven’t covered on this subject?

Jo Swinson: I know that you’ve already spoken to Ruby McGregor-Smith, which is great, because the Women’s Business Council is very exciting. I suppose the only other thing would be to make sure that your attention is drawn to the “Think, Act, Report” initiative?

Harriett Baldwin: Yes, we had something on that in our brief.

Jo Swinson: Because again, on the whole, can we do these things and this cultural change on a voluntary basis rather than regulating? I very much want to see us do that, but we do need to make sure that companies respond appropriately to that. That’s obviously very much aimed at large employers.

Thérèse Coffey: Fabulous. Thank you so much.

Jo Swinson: Thank you. I’ll be interested to see the results.

150 Written Evidence: Submission 1 Written Evidence: Submission 1

Dr Heather McGregor, MD, Taylor Bennett

Activity through the 30% club The 30% Club is a group of Chairmen and organisations committed to bringing more women onto UK boards, because they believe it is good for the overall effectiveness of the boardroom - and therefore good for business. The club launched in November 2010, and its aim is to achieve the 30% goal of women on boards by 2015.

There has been strong progress to achieving this goal:

■ Initially there were 7 founding chairmen supporters; now there are 55, representing 60 companies between them ■ At launch, 12.5% of FTSE-100 board directors were women and this figure had not changed for 4 years; today 17.3% of FTSE-100 board directors are women ■ The pace of change is accelerating sharply: in 2010 12% of the previous 100 FTSE-100 non-executive appointments were women; since March 2012 55% of non-executive FTSE- 100 appointments have been women.

The pipeline is increasing. There are many well qualified women but they need encouragement and support.

What next? The rate of growth of female Executive Board members has been slow. This is where efforts need to be focused. There needs to be more visibility of the executive pipeline within companies.

Larger companies need to be encouraged to identify and support aspiring and talented women. However, this needs to be a business-led, voluntary change, in contrast to the EU pressure for a quota. The 30% club believes strongly that this must be achieved without legislation.

A summary of key issues which Heather McGregor believes senior women need to address in order to progress is attached here (Appendix 1), and detailed in Careers Advice for Ambitious Women.

A specific recommendation, supported by the 30% club, is that: The nomination committee of a public company should have the power to request information regarding the gender record of the executive search firm to be used for senior appointments, non-executive, or executive.

By way of example, I attach to this submission the gender record of my own company over the last 4 financial years (Appendix 2).

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Appendix 1

Heather McGregor believes that the overriding issues to be addressed by women seeking to build a career today are: self-confidence; time management; and the establishment of an effective strategy to cover the child-bearing years. The following points build on these 3 essentials.

■ Continue to develop human capital; 2/3 of MBA students are still male ■ Develop social capital; if there is no obvious opportunity, make it yourself ■ Learn how to ration time. There are 168 hours in a week and for a busy woman this time will be hugely dissipated. You cannot achieve without sacrifice. ■ Stop trying to have it all and do not feel inadequate that you can’t. Whether male or female you can achieve the things you want over a lifetime, not all at once. ■ Delegate and outsource ■ Acquire financial fluency ■ Establish a position of thought leadership ■ Cultivate your team skills beyond and outside of the workplace ■ Build in a third dimension to your life, whether as a junior employee or at the most senior level and seeking a board position

Appendix 2

Taylor Bennett Ltd placements - gender record

Financial Year Placed Candidates Placed Candidate Salary Brackets Shortlisted Candidates Male Female Salary (£) Male Female Male Female 2008-2009 24 25 60-99k: 11 17 88 72 100-149k: 10 6 150k+: 3 2 2009-2010 32 33 60-99k: 18 19 110 91 100-149k: 9 10 150k+: 5 4 2010-2011 35 25 60-99k: 16 16 65 69 100-149k: 14 7 150k+: 5 2 2011-2012 44 29 60-99k: 15 19 93 92 100-149k: 16 10 150k+: 13 0

Taylor Bennett pipeline of female talent We have conducted a database search to establish significant contact over the period from 28th June 2012 to 28th January 2013 (7 months). Men: 264 met; 488 catch up conversation Women: 270 met; 501 catch up conversation

DISCLAIMER Due to the structure and operation of the database there will inevitably be some level of ambiguity to the results; however, precisely the same criteria have been applied to the searches for men and women, and thus for comparison purposes the data will be informative.

152 Written Evidence: Submission 2 Written Evidence: Submission 2

Cynthia Carroll, former CEO, Anglo American

1. Do you think the gender diversity of a company, particularly at senior executive levels, matter to the success of that company? Has the business case made by McKinsey’s Women Matter research changed your view?

I have always believed that diversity, at all levels, in an organisation makes good business sense and certainly matters to the success of a company. To be a leading company, you need to attract the best people – men or women. Women represent 50 per cent of the global population and are, therefore, a vast pool of talent to be tapped. But the benefits extend beyond this. Organisations that draw from a broad range of experiences and expertise are better equipped to face challenges. As a truly global company, with mines all over the world, Anglo American has to have a diverse workforce to help us understand the communities that we work with and are a part of.

2. Lord Davies recommended that investors engage more with their investee companies regarding gender diversity. What conversations do investors in Anglo American have with the company about this, and what effect have you noticed in the last few years?

This is not an issue that comes up often with investors. Although, over the last few years, general awareness of this issue has increased, due to reports such as McKinsey’s Women Matter and the work of organizations like the 30 Percent Club. I absolutely expect interest levels will continue to increase in the coming years. Investors interested in the long term good business performance of companies should focus on issues such as diversity to a greater degree for the reasons I have already mentioned. Organizations will increasingly need to be able to demonstrate the progress that they are making in this area.

3. As a mining company, what particular gender challenges does Anglo American face, and how do you seek to counter them?

Mining is traditionally a male-dominated industry. The challenges to change this have been significant, in both practical and cultural ways. At Anglo American we have sought to focus on four main areas. Firstly, on establishing a conducive working environment. As recently as 1996, in South Africa, women were not legally allowed to go underground into mines. As a result, mine sites did not cater for women. We have had to introduce female toilets and re- design our uniforms. Some of our mines already have crèches and this is something that we hope to progress going forward. Secondly, driving gender diversity through robust workforce planning and recruitment. For example, in parts of Australia and Chile, where we face labour shortages, we have run recruitment campaigns specifically designed to appeal to women, as well as men, with the aim of bringing new people into critical roles such as haul truck operators.

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Training courses, awareness raising campaigns, and specific roles have been advertised through non-traditional media and designed to take child-care needs into consideration. Thirdly, accelerating gender diversity through employee development. Our internal HR reviews use gender data to track how and where talent is developing. In our Platinum business, we have targeted workplace training and mentoring schemes to help women gain the skills they need to enter into leadership engineering positions. Finally, we work to improve the communication and understanding of gender diversity objectives. I have encouraged my senior leadership team to understand the value of gender diversity. They in turn have communicated this to their teams.

4. Are we doing enough to encourage young women at school and university to study the kind of subjects they would need to enter a sector like mining?

There are not enough people studying science and engineering in the UK - men or women. We have a range of activities to try and tackle this. For example, the Anglo American Foundation supports the Engineering and Development Trust in their Widening Participation programme, which aims to encourage school children, in particular ethnic minorities and girls, to consider engineering for further study. We sponsor Talent 2030, a programme that encourages students to take sciences at GCSE and A level. In South Africa, we fund Techno-girl, a NGO that supports girls aged 15 to 18, providing them with practical and technical experience that contributes to their studies.

5. Does Anglo American collect data on female participation at each management level? If not all, at any?

Yes we do. We have 15% of women in our overall workforce (up from 10.6% in 2007) and 23% of women at management level (up from 15.3% in 2007).

6. What impact do you think collecting and publishing that data would make on gender diversity on the population of senior executives? Would you support a greater depth of reporting on gender diversity at up to, say, 3 levels down from the Executive Committee of a FTSE 100 company?

There has been a huge amount of focus on Women on Boards. Whilst it is an important topic, we will only see more progress if we have women throughout the talent pipeline, at all levels of an organization. Whilst greater transparency and reporting might help this, it is important to recognize that different industries and companies are at very different stages and face different challenges. The focus should be more on action and encouraging companies to strengthen and change their processes, to increase the number of women in their workforce.

7. The inquiry has heard from witnesses that commitment to diversity throughout a company, from the top and extending to grassroots levels, is a major factor in bringing about change in the pipeline of talent. How do you go about embedding diversity in management thought and practice?

The values of an organization are important. One of our six values is care and respect. Our employees treat people with respect, dignity and common courtesy – regardless of their background, lifestyle or position. This is as relevant when hiring people as it is in day to day

154 Written Evidence: Submission 2

interactions. Leadership is also very important. Senior leadership needs to set the tone to achieve a transformational mindset change with regard to diversity. I discuss diversity with my ExCo and in turn, our senior management discusses diversity with their teams. Diversity at Anglo American is taken into consideration every time management reviews talent in their teams. At our Metallurgical Coal business unit, we have established a Diversity Council, chaired by the CEO, with an equal representation of men and women from senior management, looking at establishing flexible working environments conducive to diversity, monitoring the progress of our initiatives and profiling Met Coal’s diversity leadership champions.

8. A common feature of many of the companies and organisations that we have interviewed is the importance of unconscious bias training. What role does it have in Anglo American’s business, including its recruitment and promotion practices?

Our Metallurgical Coal Business Unit has introduced unconscious bias training for all their senior leadership team. This is something that we hope to roll out to other Business Units.

9. We have also heard about the importance of sponsorship, mentoring and coaching to foster talent of either gender, but women are much less likely to put themselves forward for such support of their own accord. What arrangements does Anglo American have of that nature, particularly to help talented women?

We recognize the importance of mentoring and the need to support the development of all employees, regardless of gender. This year, in the UK, we have joined an initiative called The Pearls, a women’s development and networking programme for our UK-based female managers run by an external organization, called “An Inspirational Journey”. We are also currently considering the best ways to increase the number of mentoring opportunities within the company, and have introduced a Group-wide approach to mentoring.

10. Is the issue of childcare a key barrier to women leaving or stalling in their career? What actions does Anglo American take to address that?

Childcare is a key issue for many women when developing their careers. At Anglo American, we have established childcare facilities at a range of our operations. In 2007, our Thermal Coal business established its first 24/7 childcare facility at Greenside Colliery. After various interactions with employee representatives, Thermal Coal signed a childcare facility framework in early 2012 to ensure that all operations’ employees would have access to suitable childcare facilities and provide parents in our company with the comfort of secure and decent child care for their children.

11. Could you outline what arrangements your company has for flexible or part-time work, for employees of either gender?

In the UK, there are numerous examples where individual managers have chosen to respond positively to employee requests for more flexible working arrangements. In doing so, they believe there are substantial benefits which outweigh some of the inherent costs and risks. These tend to be personal ad hoc arrangements agreed between managers and employees on a ‘one on one’ basis. Examples include job sharing, shortened working weeks, amended start and finish times and occasional working from home arrangements.

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12. Does Anglo American continue to engage with women (and men) who take career breaks, so that they have the option of returning to the pipeline in the future and to encourage them to take that option?

Our employees are able to request a long period of time away from work in order to pursue voluntary service, advanced study or to meet other care commitments. Anglo American reviews requests on a case by case basis. This year, we are examining how we can better engage our alumni across the company. We expect this to result in formal programmes to enable us to stay connected to former employees.

13. Are you optimistic about the future on this topic? If so, why? If not, what can we do to turn it around?

I am very optimistic. During my time at Anglo American, I have met inspiring women all over the world, who have achieved a great deal and have bright futures ahead of them. Companies need to stay focused on this issue and, where possible, do what it takes to ensure that they have access to the best talent. There is still a long way to go. However, a huge amount has been achieved. We need to remain focused on pursuing further change.

156 Written Evidence: Submission 3 Written Evidence: Submission 3

Jackie Hunt, CFO, Standard Life

In your role as a major investor with tracker and active funds,

1. Do you think the gender diversity of a company, particularly at senior executive levels, matter to the success of that company? Has the business case made by McKinsey’s Women Matter research changed your view?

Standard Life Investments recognises that diversity, including gender diversity, can bring insights and behaviours that may make a valuable contribution to effective management and success. It expects the boards and senior executive management of companies in which it invests to either have diversity or provide convincing explanations to support why they do not. Standard Life Investments believes that a company should have a blend of skills and attributes that are appropriate to its needs. A company should be able to demonstrate with conviction that any new appointee can make a meaningful contribution to its activities.

The McKinsey’s research compellingly strengthens the business case for why gender diversity matters to the success of the company. Our view has always been that a balance of talent at all levels of the company is vital to its success.

2. Do you assess gender diversity with your portfolio companies? Do you raise it with the Board? Would you, for instance, ever vote against nomination committees because of this point, or raise the issue during appointments to executive or board positions?

Standard Life Investments issued a position paper titled ‘Diversity on the Board’ in February 2011 following the publication of the Davies review. In the paper we state that we recognise the importance of institutional investors holding to account the boards of companies in which they invest. The UK Stewardship Code provides that institutional investors should monitor their investee companies and that they should seek to ‘satisfy themselves ….that the investee company boards are effective; also, that they ‘should consider carefully explanations given for departure from the UK Governance Code’.

Therefore, in fulfilling its stewardship responsibilities, Standard Life Investments will:

■ Engage with investee companies about their approach to diversity and, when companies do not comply with the Governance Code provisions relating to diversity we shall consider their explanations carefully and, when appropriate, engage to satisfy ourselves that the explanations provided are consistent with the spirit of the Code and in the best interests of the company.

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■ Encourage companies to ensure that their board evaluations address diversity and the contribution made by individual directors, and provide a balanced and reasonable commentary on these aspects in their annual reports. In selected situations we shall engage with companies to discuss in appropriate terms the process and outcomes of the effectiveness review in these regards.

■ Ask investee companies to make due provision in the process it uses to appoint independent non-executives for active long-term institutional investors to be invited to suggest candidates for consideration. It is believed that this will help to broaden the diversity of candidates that are sourced by more traditional means.

■ Vote against the re-election of members of the Nominations Committee in the event that it feels that over time, due regard is not being had for the spirit of its views relating to diversity.

We have had, and continue to have, engagement with investee companies about their approach to diversity and have found that, in general, they have demonstrated willingness to address diversity and so, thus far, we have not found it necessary to use voting to address such issues.

3. Lord Davies recommended investors engage more with their investee companies regarding gender diversity. How have you changed your approach in the last few years?

Our governance and stewardship team was set up in 1992 and we are now seen as one of the leading UK institutions in this area. We have a long record of engaging with investee companies on topics that we believe are important to add value to the investments that we make on behalf of our clients. As highlighted above, following the publication of the Davies review, we issued our position paper on diversity. Although the importance of diversity on boards has been inherent within our engagement over the years, the Davies review provided additional focus on gender diversity in particular. In the recent past we have therefore increased our focus on issues such as succession planning and board nominations, which includes considerations of gender diversity.

4. Would you support a greater depth of reporting on gender diversity at up to, say, 3 levels down from the Executive Committee of a FTSE 100 company?

Reporting should provide information on how diversity, including gender diversity, is managed by a company but we believe it needs to be relevant to the particular company reporting rather than ‘boiler’ plate statements. A requirement to simply report on the gender diversity to a predefined level in a company will not necessarily tell the whole story. For instance a global company may have operations in many different countries with different cultures which could result in skewed reporting. We would expect reporting to cover all relevant diversity matters rather than just gender diversity.

Within your own company,

5. Does Standard Life collect data on female participation at each management level? If not all, at any?

158 Written Evidence: Submission 3

Standard Life does collect data on female representation at each management level (from our most junior levels all the way through to Board) across all our businesses.

6. What impact do you think collecting and publishing that data would make on gender diversity on the population of senior executives?

Data collation and publication in itself raises awareness and helps us track progress. However, the usefulness of data collection and reporting comes from how it helps to focus action. For example, we’ve found it has helped us inform conversations about nominations to our talent programmes.

7. The inquiry has heard from witnesses that commitment to diversity throughout a company, from the top and extending to grassroots levels, is a major factor in bringing about change in the pipeline. How do you go about embedding diversity in management thought and practice?

We agree that commitment to diversity at all levels in the company is important in bringing about change in the pipeline. There are a number of ways that we embed diversity in management thought and practice. We have a strengths based philosophy for all our employees which recognises each individual’s strengths and talents and embeds diversity of thinking in its broadest sense. Our leadership behaviour framework includes diverse and inclusive behaviours, which indicates to our leaders how we expect them to behave, and how they are developed, measured and rewarded. We’ve embedded diversity considerations through our training, from our Induction, through to our management training, and in our specific diversity e-learning (mandatory for all employees). And we are equipping our HR professionals with the ability to challenge decisions they identify in the business that may not be in line with a diverse approach (either at recruitment stage, through our talent nomination process, in development and succession conversations, etc). In the past year, we have subtly and regularly embedded diversity messages into our internal communications.

8. A common feature of many the companies and organisations that we have interviewed is the importance of unconscious bias training. What role does it have in Standard Life’s business, including its recruitment and promotion practices?

We are in agreement that the potential impact of unconscious bias is important. At the end of last year we commissioned a new mandatory training course which will be rolled out to all employees from April this year, part of which is designed to raise awareness of the topic and encourage our people to start to identify any unconscious bias they may have. A more in depth understanding will be required of our HR professionals supporting recruitment and promotion in the business, and we are working with an external specialist to design appropriate training for this group (for the second half of this year).

9. Could you outline what arrangements your company has for flexible or part-time work, for employees of either gender?

Wherever possible, we aim to accommodate needs for flexible working in Standard Life in line with our business needs. In the UK, we offer a flexible working policy to all employees, covering different working hours and patterns, such as part time working, job sharing, compressed hours and working from home.

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In addition, for certain categories of employees, we offer a flextime scheme to allow some degree of personal choice over working hours, whether employees work full or part time.

We are also running a number of projects in the company at the moment, designed to test different ways of working using new technologies and working environments, which will increase work flexibility. This includes looking at the use of mobile technology and investigating how ‘bringing your own devices’ to work can create a more flexible culture.

10. Does Standard Life continue to engage with women (and men) who take career breaks, so that they have the option of returning to the pipeline in the future, and to encourage them to take that option?

Standard Life does not offer a career break scheme.

11. Is the issue of childcare a key barrier to women leaving or stalling in their career? What actions does Standard Life take to address that?

We don’t have any evidence that childcare is a reason why women leave roles in Standard Life or are stalling in their careers. But we’re very aware that it could be a factor and so we have taken specific actions to prevent or reduce this. We encourage contact with women while on maternity leave through ‘keeping in touch’ days. For women at senior levels, we align an internal coach, who they continue to engage with while they are on maternity leave, in line with individual needs. They are also invited to participate in leadership events during their leave. Once women are considering returning to work, we have a flexible working policy (open to all employees) so that changes can be made to working arrangements to accommodate childcare. We also provide childcare vouchers as part of our flexible benefit package.

12. As a CFO, having a financial background must have been key for your successful career. Recent research suggests female executive directors are much more likely to have financial experience than men. Would you say that a stereotype remains that women cannot deal with numbers, and they need qualifications or visible experience to overcome that stereotype?

I have never encountered this stereotype and believe that qualifications and experience are critical success factors for both genders.

13. Are you optimistic about the future on this topic? If so, why? If not, what can we do to turn it around?

I am optimistic that society, government, employers and women themselves are interested in improving the pipeline of female talent. It’s a complex and important topic and will need sustained focus from multiple angles.

14. What would be the single policy you would like the Government to introduce to help the pipeline of talent?

We have relevant policies in place, and rather than additional legislation, it’s my view that best practice guidelines or a voluntary code of conduct would have more impact. We need to work together (business and industry, government, education, investors, women’s groups, etc) to tackle cultural perceptions and their impact on women in business.

160 Written Evidence: Submission 4 Written Evidence: Submission 4

Heather Jackson, CEO, An Inspirational Journey

1. Do you think the gender diversity of a company, particularly at senior executive levels, matter to the success of that company? Has the business case made by McKinsey’s Women Matter research changed your view?

What matters is getting the best talent to the top regardless of gender- and breaking down any barriers that may get in the way of this process. In terms of the business case the McKinsey’s Women Matter research has not influenced my view but it has provided more evidence on the fact this is not a diversity and equality issue but a business issue. It has given women and organisations a more succinct and powerful motive to improve gender parity.

2. Lord Davies recommended that investors engage more with their investee companies regarding gender diversity. What effect have you noticed in the last few years?

In terms of investor engagement on this agenda there is no one silver bullet to this- investors and executives need to concentrate on the pipeline. There is not just one ‘enabler’ as they need to work on all areas of change (culture, flexibility, confidence, sustainability, unconscious bias, systems and processes).

3. What impact do you think collecting and publishing that data would make on gender diversity on the population of senior executives? Would you support a greater depth of reporting on gender diversity at up to, say, 3 levels down from the Executive Committee of a FTSE 100 company?

Absolutely- we need to work at least 3 levels down from the executive, ideally from graduate level through to the executive for longer term change and influence.

4. The inquiry has heard from witnesses that commitment to diversity throughout a company, from the top and extending to grassroots levels, is a major factor in bringing about change in the pipeline of talent. How do you go about embedding diversity in management thought and practice?

Truly embedding diversity needs ‘buy in’ from all levels of organisations. We also need to look outside of the FTSE 100 and look to FTSE 350 and non-quoted companies as a key audience and the backbone of our economy within this process.

Organisations need to apply effective systems and processes that communicate the importance of gender diversity for the benefit of better business and get support from all stakeholders. This ranges from senior management right through to the individuals employees themselves.

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5. A common feature of many the companies and organisations that we have interviewed is the importance of unconscious bias training. What assessment would you make of its effectiveness?

To change the culture of an organisation the Chairman alongside the Chief Executive have to truly invest in changing ‘unconscious bias’ by not just expressing support but acting on it and introducing systems that prove their dedication. Unconscious bias is an important factor for both men and women but as stated earlier, this is only one of the many enablers for change that need to be addressed.

6. We have also heard about the importance of sponsorship, mentoring and coaching to foster talent of either gender, but women are much less likely to put themselves forward for such support of their own accord. Do you have an opinion?

There are two main perspectives with regards to the importance of sponsorship, mentoring and coaching. Firstly, the three approaches are very different and there needs to be a clear understanding by women of what they bring to career development. Some women would benefit from a mentor, but not necessarily a sponsor etc. Secondly, women themselves need to have the confidence, self-belief and understand their importance to our economy to put themselves forward for such opportunities in the first place.

7. Is the issue of childcare a key barrier to women leaving or stalling in their career, and how can it be addressed?

Childcare is clearly a barrier to female career progression (to those with children) but it is not key to it. Changing the culture and perceptions around this approach is however; getting to a place where men and women adopt shared paternity as the social norm, sharing career responsibilities and the help of government in providing support to enable this to happen is needed. We should also not assume that all men and women want children.

8. What impact do successful part-time and flexible working arrangements have on growing the pipeline?

The impact successful part time and flexible working arrangements have on the pipeline allows us to incubate talent and help prevent the loss of this talent from middle to senior management.

9. How good are companies at career break schemes, so that women have the option of returning to the pipeline in the future and to encourage them to take that option?

At this moment in time I actually feel the focus should not be on women returning to work but in prioritising finding ways to ensure the prevention of women leaving the workplace to begin with.

10. Are you optimistic about the future on this topic? If so, why? If not, what can we do to turn it around?

I am optimistic that change can happen with a realistic view for such change to occur over a 10 year period. But we need to stop setting short term, unrealistic targets and work on the talent pipeline, providing solutions at all levels to evoke long term, sustainable change.

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11. What would be the single policy you would like the Government to introduce to help the pipeline of talent?

I don’t think there is one single policy needed but the government needs to stop chastising and start to support, guide and direct companies by communicating the business issue and helping to offer solutions on this (and endorsing companies that do this). Women in middle management need more support in terms of childcare benefits. In terms of governmental campaigns- one which could communicate to female talent that our economy needs them would be a great message to motivate change and help the pipeline.

163 Executive Women in the Workplace Inquiry Written Evidence: Submission 5

Helen Owers, former Executive, Thomson Reuters

Sarah

It was a pleasure to meet you on Saturday.

I said I’d get back to you with a few thoughts on women in the workplace. The context of my comments are as an executive with over 30 years commercial experience, the last 10 with Thomson Reuters where I led a major global division and then emerging markets. I now have a plural career and sit on the boards of PZ Cussons plc and the Eden project. In addition I am continuing as an advisor for Thomson Reuters and mentor executives in China and India. I was myself a mentee on the FTSE 100 Cross Company Mentoring Programme and am now a mentor on the Pilot Programme. I also took part in the Glass Ladder programme run by Bird & co which focuses on preparing women to sit on boards.

Many companies run innovative programmes to support working women with children (childcare etc). A critical element missing is the conversations women want to have ahead of the decision to have a child. My experience with the women I mentor and many other women I speak to, is that they want to talk confidentially and personally about having children to someone who has ‘been through it’. This is not about training courses or child care but managing a career alongside fundamental life choice decisions. The questions range from when to have children, when to have the next child, how to communicate their boundaries to their (often male) boss, how to retain credibility and career trajectory etc etc. This is something that is difficult for the organisation to provide directly unless there is significant trust.

My experience of leading and working in diverse teams is that they are more challenging and require significantly higher levels of emotional intelligence, patience and listening. Ultimately these teams deliver better solutions and are definitely more rewarding and fun. My executive committee comprised individuals from the UK, Canada, Australia, Argentina, China, India, Japan etc. We met quarterly and tended to have ‘standard’ meetings in London. I needed to change the focus and way we were working. A meeting in China - out of their comfort zone - more than achieved this. Taking executives out of their comfort zone in terms of diversity in people, place and ideas is crucial to challenge preconceptions and drive to better results.

Another question that is worthy of investigation but for which I don’t have significant evidence:

There is significant proof that diversity (gender, race, age etc) improves performance. Questioning and points of view from multiple perspectives ensure that the right conversations happen in any team, that the status quo is challenged along with the ‘norms’ of any business.

164 Written Evidence: Submission 5

During recent years as many companies have suffered from the economic downturn and have had to adapt their business model or risk failure. How many CEOs have been brave enough to bring in new teams/perspectives vs. restructure? How many have filled roles with executives that fit the anglo business paradigm (and usually look and act like them) and whose experience is predominantly in that paradigm? What are the results of companies following each approach? My hypothesis would be that those CEOs who have truly embraced diversity have been quicker to refocus their business model and deliver higher growth.

Please let me know if you’ve any questions. I’d be delighted to input to your work in any way that is appropriate.

Best wishes

Helen

165 Executive Women in the Workplace Inquiry Written Evidence: Submission 6

Dominique Hainebach, MD, Renew Partners

Women in Professional Services Women are still not making up a proportionate number of the promotions and therefore not reaching senior levels in professional services firms despite the efforts of firms to support women and their careers. The magic circle firms for instance have seen a 60% overall reduction in female promotes in 2013 compared to the 2012 numbers, whereas the male promotions were only down 17%.1

The professional services firms not only suffer similar challenges to FTSE companies, in terms of low percentages of senior female executives, but there are some additional challenges that women face in these environments compared to their colleagues in other sectors.

Core to the professional services diversity challenge is that both the business and moral case for gender equality and diversity are undermined by a strong client service ethic. Ashley and Empson2 found in their research that, “The most important aspect of client service is responsiveness to client demands and expectations. In practice, this is interpreted as meaning constant availability to the client: the ability to respond quickly to demands which are sometimes erratic and unpredictable; the effective and efficient turnaround of projects often at short notice; and the provision of advice by an individual (or team) who is consistently available, known to, and trusted by, the client.” So, although effective client services is consistent with the diversity and inclusion business case, the structural changes required to make it possible e.g. flexible working and remuneration policies, often run counter to the dominant culture and way of doing things.

Long-hours culture The long hours culture3 of professional services makes the assumption that arriving early, leaving late and being available at the drop of the hat, reflects commitment, dedication and responsiveness to client and firm. This makes flexible working arrangements difficult and although technically flexible working options are made available, those that take them up aren’t seen to be taking their careers seriously.

This is exacerbated even more in parts of the business that work on a very transactional basis and for global clients where the hours are very unpredictable and the time zones require availability at all sorts of unsocial hours.

Professional services is increasingly attracting more women; however, the trend is for women to choose the roles and areas of expertise that require less mobility and are often seen as lower in status and therefore command lower salaries.

Male Dominated culture Professional Services are known for their male dominated4 cultures characterised by competitive up

166 Written Evidence: Submission 6

or out performance systems, client entertaining activities such as drinking, golf days and individually promoting assertive behaviours. Women often feel pressured in these environments to take on male behaviour and styles that are sometimes inauthentic and over time many women would rather leave than keep up what they believe is the expected way of doing business. There are few female role models of how to be successful in these environments without being considered aggressive and being respected for being true to themselves without taking on the dominant culture. The lack of desirable role models makes it harder for women to know whom to emulate and makes it less desirable to join the senior ranks. The expectation of the firm for all individuals to display the expected male culture characteristics makes it problematic for the women who take these characteristics on less comfortably. These environments also require individuals to be proactive in self-promoting their careers and contributions which tends to be more problematic for women.

The up-or-out model also makes assumptions on how long those professionals with potential require at each level. Women who tend to be the ones taking leave of absence for childrearing are the most impacted by these time bound assumptions.

Social Capital A key requirement for being successful in professional services firms is having a good client network and supporting mentors and career sponsors. The two challenges in this for women, that seem to be less of an issue for their male counterparts, are the ability to build relationships with dominantly male colleagues and clients with the same level of comfort and ease and that traditionally it is the women who are expected to go home to their families at the end of the day and find it harder to make the time for client entertaining and events in the evening. This results in many cases in the women not having the same profile and recognition of their work and expertise both within the organisation and externally as their male colleagues who spend the time socialising outside of the formal structures.

Physical Capital A phrase coined by sociologist Pierre Bourdieu to represent power, status and distinction encapsulated in the ways that we present ourselves or are perceived by others is ‘physical capital’. Haynes3 found in her research of women lawyers and accountants in the UK and US that “Participants were clear that they had to present a professional appearance, but that it was not always straightforward to know what that meant. “Professional demeanor” can be ephemeral and difficult to negotiate. Women lawyers, for example, were aware of the need to be assertive but not perceived as overly aggressive, even though the nature of the job requires a degree of physical presence, performativity and authority.”

This again increases the challenge that women have of finding a leadership style that works for them and is recognised by the firm as worthy of promotion.

1a http://www.legalweek.com/legal-week/news/2265672/magic-circle-partner-promotions-fall-17-as-female-promotions-see-60-dropoff 1b http://www.thelawyer.com/news-and-analysis/market-analysis/notebook/partner-promotions-drop/3004464.article 2 Professional Identity Formation and the Body in Professional Services Firms http://www.esrc.ac.uk/my-esrc/grants/RES-331-27-0022/read 3 Are there parallels between professional services and HE? The Guardian, Kathryn Haynes, Wednesday 29 February 4 Women tuning out of professional service firms, November 12, FT, by Liz Bolshaw 5 Lessons from female leaders in professional service firms November 01, 2011 Bain Brief By Julie Coffman, Karen Welt Steeves and Emily Miller 6 Convenient fictions and inconvenient truths: The role of paradox in understanding female career progression within leading UK accountancy firms. by Louise Ashley and Laura Empson.

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