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Speech by The Hon Kate Ellis MP

Key note address – Second Annual Corporate Gender Equality Summit – Melbourne

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I would first like to pay my respects to the traditional custodians of the land we meet on today – the Wurundjeri people of the Kulin nation.

I would also like to thank Informa for inviting me to speak at your Conference.

I am delighted to see so many of you here today to discuss strategies to advance gender equality in corporate Australia.

Of course, there are a number of reasons why it is in the interests of companies and individuals pursue gender equality in the workplace.

For some, it is simply a question of rights. No one should experience unequal treatment based on their gender.

Indeed, it is fundamental to the Australian spirit of a fair go that we ensure that there is a level playing field for both men and women in workplace.

With men and women graduating from university or vocational education in equal numbers, the gap in their expected outcomes in the workplace in terms of pay, promotion and other opportunities cannot be justified or excused.

For others, gender equality is a question of national competitiveness.

Strong international evidence indicates that gender equality is good for the national economy, and it is a necessary focus if we are to secure the future wellbeing of Australia in the face of skills shortages.

The World Economic Forum has clearly identified the link between productivity and increased participation of women in the workplace: “There is a strong correlation between the gender gap and national competitiveness…a nation’s competitiveness depends significantly on whether and how it educates and utilizes its female talent.”

Compelling new research by Goldman Sachs JB Were concurs. That research found that closing the gap between male and female workforce participation rates would have important implications for the Australian economy, boosting the level of Australian GDP by an estimated 11 per cent.

Some may be here today because they know that gender equality is a profit driver, with many benefits for the corporate bottom line.

When leading international company Catalyst analysed the Fortune 500 companies, it found a direct link between the success of an organisation and an increased number of women in executive roles. Companies with the highest number of women on their boards had a 53% higher return on equity, a 42% higher return on sales, and a 66% higher return on invested capital.

While the media spotlight can often be focussed on the issue of women on boards, it is not only these appointments that make a difference. It is equally important to have women progressing through the pipeline – from graduate recruitment to senior management.

International research indicates that there are positive business outcomes from greater gender diversity in senior management positions. A study of 1,500 business leaders world-wide by McKinsey showed that organisations with a higher proportion of women in management perform better financially, with 10 per cent higher return on equity, 48 per cent higher average earnings before interest and tax, and 1.7 times better share price growth than the average company.

Some of you may be here today because you know that gender equality is the only way to address a looming labour shortage.

From both a participation and productivity perspective, we know that women are an untapped labour resource in this country. Five million, or around 60 per cent, of Australian women are in the workforce. This is low by international standards, with the World Economic Forum placing us 44th in the world for the labour-force participation.

This is a source of labour that we must tap if we are going to meet the challenges of critical labour shortages which have been predicted for the industries that are vital to our nation’s economic success.

Regardless of what brings you to the need for increased gender equality in the workplace, it is clear that it is an issue with strong benefits for companies, governments and communities in this country.

It makes sense then that the solutions need to be owned by all three.

Lessons from the last 25, 40, or even 100 years have shown us that the achievement of gender equality requires action across all sectors – government, corporate and community.

From a government perspective, we know that this cannot be achieved by one portfolio or policy area alone. It requires a mix of strategies from across Government.

We have introduced the Fair Work Act and we have introduced the nation’s first paid parental leave scheme.

We now fund an unlimited number of child care places to help providers expand existing services or create new services where demand exceeds supply.

And this has had a tangible impact: between September 2007 and September 2010, 76,000 more children were using approved care.

As a result of this uncapping of child care places, the number of long day care services operating in Australia has increased by more than 640 since we came to Government.

As a Government, we know that quality child care is essential to getting women back into the workforce, which is why we have doubled funding for child care affordability.
From a corporate perspective, there is much that can be done to support equitable outcomes in the workplace.

In fact, many business leaders now recognise gender diversity as a performance driver, and we have seen in the last six months that many of Australia’s most powerful companies are increasing momentum towards gender equality in all aspects of their business.

The challenge for our Government is to support the efforts of business in this space, while encouraging other workplaces with additional support to reap the benefits of gender equality.

As you may know, earlier this year, I announced reforms to the Equal Opportunity in the Workplace Agency and Act. From July 1, this Agency will receive almost double its current funding to work with business to improve gender equality in workplaces across the country.

I would like to take this opportunity today to talk about some of the elements of these reforms.

When talking about women in the workplace we tend to skip over a fairly critical part of the equation – that of course, being the role of men.

It seems that we have been exceptionally good at increasing women’s participation in the workforce in recent decades – we haven’t matched it with a decrease in unpaid work responsibilities for women.

We know from workforce participation figures that this has a very real impact for women aged between 25 – 44, the age at which many women are raising children. We also know that women are bearing the lion’s share of caring responsibilities, and that many men would like to take more of the burden, but they feel constrained by workplace culture or economic implications.

If we want to boost women’s roles and responsibilities in the corporate world we need to make some substantial progress in easing the burden of domestic and caring duties at home.

The role of men has been an important factor which many companies may easily overlook in the pursuit of gender equality.

Earlier this year, I released research, which our Government commissioned from the Australian Institute of Family Studies on fathering in Australia.

This research confirms that fathers in couple families still do less than 30 per cent of the domestic work and only marginally more of the child caring.

Importantly, it also shows that this is not ideal for men either – with 63.7 percent of fathers believing that work responsibilities had caused them to miss out on home or family activities that they would have liked to take part in.

I know that on paper flexible work policies may be available to both men and women, but we have found that there are significant cultural barriers to men taking up these options.

Many men report that they fear going part-time may be seen as a lack of ambition or a lack of commitment, rather than a decision that promotes the best outcomes for Australian businesses.

Helping people to manage their work and family responsibilities in an equitable way is the best path to ensuring that women and men are on equal footing both economically and socially.

That is why, under the EOWA reforms, we are expanding the Agency’s remit to cover both men and women.

The Agency will measure outcomes for both genders and take a particular focus on the uptake of flexible work practices.

We have also changed the name of the Act and Agency to recognise this new focus – to the Workplace Gender Equality Act and Agency.

Any time that we review or introduce legislation and regulation in this country, we are keenly aware that it is to the benefit of every Australian that our businesses thrive and grow, and not unnecessarily burdened with red tape and rigmarole.

When we reviewed EOWA in 2009/10, a significant majority of employers told us that the current reporting framework was too process-driven and needed to be fairer in how it treated organisations who are doing the right thing.

Companies with more than 100 employees have been reporting to the Equal Opportunity for Women in the Workplace Agency for twenty five years.

In effect, we heard from business that we needed to modernize and revitalise a quarter-century old framework and design it to be cost-effective for business, well-targeted and likely to achieve genuine gender equality gains.

Where previously businesses were required to establish and report their workplace equity plans, programs and processes – we are now asking them to report on their outcomes. Where we used to get pages upon pages on policy objectives, principles and pipedreams we’re now interested in hard data, facts and meaningful reporting.

Under the reforms, reporting will be made simpler and more streamlined for companies, with on-line reporting and a new set of indicators that reflect the information already collected by standard human resource management systems.

In fact, indications are reporting will be so much simpler that costs to business will more than halve as a result of these reforms.

A Regulatory Impact Statement prepared on these reforms has estimated that the cost to business of comply with the Act will decrease on average from $1200 to $450 per annum in resourcing costs.

One of the most innovative aspects of the EOWA reforms is both the new focus on outcomes-based reporting and industry benchmarking.

Benchmarking is especially important because of its explanatory power. Benchmarking within industries allows companies to look at the performance of their peers and uncover the business processes that explain why these firms are so successful.

In the context of gender equality, knowing which strategies work in particular sectors is the most critical lever for success.

So we are developing a new reporting framework under the Act which will have a number of benefits for corporate Australia, aimed at helping business achieve success through measuring outcomes and tracking trends.

We are currently engaged in consultations with industry and stakeholders around the specific metrics to be collected by the new Agency however, we know that the metrics will focus, very tangibly, on the areas that we know are holding us back: pay equity, women in leadership and flexible working arrangements for both women and men.

I want to talk particularly about the opportunities created by the capacity to look at metrics across industries.

There are two important benefits to business of this reporting and industry benchmarking.

Firstly, I know that industries and businesses are commissioning surveys and research about their workforce.

I do think that both business and industry will benefit from a new level of transparency about their own performance and that of their sector.

The second benefit of benchmarking for business and industry is that essentially, it will allow Government and the community to compare apples with apples and to identify which strategies are working within sectors.

It makes no sense to compare strategies and benchmarks for the banking industry with the resources sector, or comparing the health sector with agriculture. It is only when we divide the data by industry that is helpful for individual businesses, for Government and for employees.

Benchmarking and industry standards are not about humiliating businesses. They are not about providing additional hurdles or burdens. They are about getting valuable data and cutting it in a way that is useful – for government, business and industry groups – so we can see the problems and the solutions clearly.

It is also about recognising that there are different challenges, different circumstances in different industry.

With a doubling of its funding base, the Agency will now be properly resourced to give all organisations – but, in particular, the ones that are struggling – the help they need to make improvements and realise the full benefits of gender equality.

Businesses will be able to get support and advice online – linking them to electronic tools, resources and live support.

We will introduce mobile support teams of Agency staff that can be deployed to provide advice, work plans and resources to businesses who request it.

Smaller size businesses with less than 100 employees will also be given access to these new support mechanisms – so that we can boost their performance when it comes to gender equality, while not landing them with a reporting burden which may be too hefty for a small business to sustain.

I am confident that the reforms strike a fair balance between the need to minimize the compliance burden on business, and the need to ensure that these measures are most effectively and efficiently geared towards improving gender equality.

The increased supports provided to business reflect the partnership and facilitation role that we want for the new Agency. No business will be left behind.

We are bringing about major reform.

Reforming and delivering the new Workplace Gender Equality Agency is intended to build upon the broader, large-scale reform and investment that we have already made in gender equality and business efficiency.

We know that Government cannot deliver this reform alone. What we seek to do is put in place the framework to assist business.

Ultimately, we know that the corporate sector has the power to bridge the existing gap in men’s and women’s opportunities in the workplace – and there are already so many inspiring examples in corporate Australia.

It is our hope that we can work with you to advance these achievements – to bring about gender equality and to ensure that we tap the benefits that flow to individuals, communities and your bottom line.

[Ends].