Speaking notes for Sheridan Scott Commissioner of Competition

Competition Bureau

Leadership and diversity Remove barriers to competition: so women can make a difference

Address to the Women's Executive Network
The National Club, Toronto
November 16, 2004

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Thank you very much.

I appreciate the invitation to talk about diversity this morning. Diversity, of course, means many things to different people. I would like to focus on the role women play as a source of diversity in the workplace. A workplace, I might add, which is still dominated by men at the very senior levels.

According to Statistics Canada, women made up 34 percent of all management positions, and only 25 percent of senior management occupations, in 2002.¹ Catalyst, a leading research firm with offices here and in the US, has found that women hold only 14 percent of corporate officer positions in the Financial Post 500. In fact, around 38 percent of Financial Post 500 companies don't have a woman at that level at all. In 2002, only 14 women ran Financial Post 500 companies. While this is regrettably low, only six women were in the same position in the US.²

Another Catalyst study, published this summer, and looking exclusively at Canada, surveyed the representation of women on boards of directors. It determined that only one in nine directors of Financial Post 500 companies are women.

I spent many years on the Board of an organization called Canadian Women in Communications, thinking about ways to address this situation.

My new duties as Commissioner of Competition have not diminished my interest in this area and I would like to share a few observations with you using as a framework notions drawn from competition policy, where we focus on removing barriers to competition. This morning we might consider what barriers still exist for women to participate fully in the marketplace.

I would also argue that Canada will not be well positioned to compete in the world economy in terms of wealth creation and innovation if women are not able to compete for - and win - senior decision-making jobs. Without women at the table, companies lack the diversity of perspective women can bring to enhance our economic and social welfare.

I believe, and research I will share this morning bears me out, I believe that barriers still exist to women's advancement at the most senior levels in this country. There is, however, much we can do, as individuals, as employers, as board directors and even as parents — to change this.

Barriers? What barriers?

The barriers to women competing for top positions are not of course visible or tangible. They are, however, real. And if we were able to eliminate the barriers, we would be able to enhance senior level decision making in both the private and public sectors.

Years ago, I ran into a male acquaintance who was responsible for marketing mobile telephone services. As we all know, women are the primary consumer in most households. When I asked him about the involvement of senior women in his organization to address the needs of these purchasers, he responded that men were much better marketers than women so there was no need to diversify his workforce. Enough time has passed since then that we could argue things have changed. Yet, I was amused to read in The Globe and Mail' "Report on Business" earlier this month about Toronto ad firm Zig's successful bid for Molson Canadian's advertising account.³ While Zig was competing for the account, competitors allegedly disparaged Zig's creative team, because...they are women. How could two women in their 30s possibly design beer commercials for men in their 20s — the competing agencies asked?

These sorts of biases create the glass ceiling we all know about. (Certainly if you continue the thought process, if women can't market to either men or women, they certainly can't run organizations...or provide informed governance in the boardroom.)

That having been said, I do believe we have progressed significantly beyond the time of my male acquaintance, who thought his gender had the monopoly on marketing and playing leadership roles in corporations.

For instance there are women who are trailblazers. We all know them. We go to their luncheon addresses in the "Women of Influence" series. On a more empirical basis, the Conference Board of Canada has found that certain sectors of the Canadian economy tend to be more open to placing women in positions of power, particularly at the board level. In its 2001 study, "Canadian Directorship Practices", the Conference Board found that services and knowledge-based industries are more likely to have three or more women in the boardroom.

So it's no surprise to read that half of the 40 women in the corporate executive category — recognized last week at Canada's Most Powerful Women Summit— were from the banking sector. (The Women's Executive Network, by the way, organized that event.)

The Royal Bank's Senior VP Human Resources was quoted in a Globe and Mail⁴ article as saying the banking sector has made more effort to understand the business case for women than others.

In my own sector, I am not the only woman to lead a competition authority. The U.S. Federal Trade Commission and the New Zealand Commerce Commission are led by women and the candidate for the powerful E.U. position of Director General — Competition, is also female.

These are not only important achievements but also a tribute to the unique characteristics of women, which I will explore in a few minutes. At the same time, perhaps because trailblazers may distract us, or perhaps because we have achieved so much in recent history, I believe we risk becoming complacent.

My sense is we have much, much more work to do, to prepare the ground for the legion of bright, creative, eager, accomplished young women who follow.

If women are to be allowed to compete — fair and square for hugely demanding senior jobs — I believe there are many barriers that remain. Hurdles we can help to remove.

Attitudinal barriers to women making a difference

Whether we like it or not, we continue to be confronted with arguments against women occupying positions of power and influence. Why do we need women? Why should we proactively seek them out?

This way of thinking alone presents a hidden, and sometimes not-so-hidden, barrier.

Despite existing research to assist us, I also think we have failed to articulate effectively just how women make a difference.

To start with, women work differently than men. Now this sounds like a gross generalization, and in some ways it is. Femininity and masculinity exist along a spectrum: there are individual differences both within and between the two groups.

Still, scientific research shows the genders think differently. American anthropologist Helen Fisher, in her 1999 book The First Sex— the natural talents of women and how they are changing the world, argues that the genders differ in their approaches to life and the workplace.

And she identified at least one physiological basis for this. The corpus callosum— the large bundle of nerves connecting the two lobes of the brain — is much more highly developed in women than in men. This allows for significantly more information exchange between the two halves of the brain, providing an explanation, Dr. Fisher argues, for those female attributes like intuition.

So it is not surprising that women are talented communicators. They excel over men at reading nonverbal clues emitted by the people they are communicating with. We multi-task better than men, and in general we take a broad contextual view of issues. We have a preference for cooperation over competition, reaching consensus and leading egalitarian teams.

These unique characteristics held by women add diversity to decision making in the workforce, and are therefore a key ingredient to a diverse work force.

So women can make a difference to the dynamics of the work place. But research suggests there may also be a strong business imperative to increasing diversity. Its January 2004 study, "The Bottom Line: Connecting Corporate Performance and Gender Diversity", Catalyst demonstrates that gender diversity in the workplace and strong corporate performance go hand in hand. The study says that US companies that recruit, retain and advance women benefit from better decisions, better products and post better financial results than their more homogeneous counterparts.

Companies with well-integrated workforces show a 35 percent higher return on equity, and a 34 percent higher total return to shareholders. In short they outperform by about a third companies that can't or won't support the inclusion of women in their ranks.

The traits at which women excel translate into extremely valuable contributions to the workplace and corporate performance. Our unique skills would appear to be invaluable to the evolving economy and workplace. So armed with this knowledge we need to change archaic attitudes — remove this barrier — about whether women can make a difference.

Who's at the board room table

Unfortunately, the same dated attitudes I talked about previously have affected the number of women invited to serve at the board level. You've heard these arguments before. Why do we need women, anyway? Why bother seeking them out for board appointments?

How will women make any difference?

The bold facts are that very few organizations do seek women out. Women constitute more than half the Canadian population. They are almost half the workforce. But when it comes to their representation in senior ranks and at the board level, their participation plummets.

I am a firm believer in the necessity of more women taking a place at the boardroom table. I have served not only as Chair of Canadian Women in Communications, but also headed its "Women on Boards" initiative to advance the participation of women at the board level in the communications industry.

Referring back to this summer's Catalyst study on Canadian boards of directors: women held only one in nine directors positions at Financial Post 500 companies. That's 11.2 per cent of all positions. Less than a two per cent increase in two years and still two percent behind the US. And there are still more than half of these Corporations with no female directors.

Fortunately the public sector is decidedly better: almost a quarter of directors at Crown corporations are women.

The Conference Board of Canada has examined the business case for women's participation on boards. In its May 2002 study, "Women on Boards: Not just the Right Thing but the Bright Thing", the Conference Board actually found that the 42 largest Canadian companies lead the US in the proportionate number of women on boards. But where even more work has to be done is in the next tier down of private sector firms.

Perhaps more important than the nose count, is the impact women have on board decision making and the overall success of a company. Taking a backward glance, the Conference Board concluded that companies with two or more female directors in 1995 were likely to be industry leaders in revenues six years later.

Generally, the Conference Board has found that boards with a higher proportion of women have stricter accountability practices and they assume more of the governance responsibilities set out by the Toronto Stock Exchange.

And research shows that corporations with female board members are more likely to have female officers.

It also follows that the presence of females in an organization, particularly and visibly at the top, is likely to attract young women to the company.

With the Baby Boom generation heading toward Freedom 55, competition for young talent is going to be ferocious. I don't need to remind you about the principles of supply and demand.

In face of these barriers to women competing for senior jobs and being asked to serve in boardrooms across the country, we must return to the business case for change, and use it to change people's attitudes.

Removing the barriers

There are many ways to remove barriers. Perhaps the first for me is to deliver these remarks to a predominantly male audience.

There are other ways as well. We should consider the next generation.

I remember when I moved from Vancouver to Toronto in my teens, a move that was daunting in itself, I arrived at a high school where it quickly became evident to me that girls were to be seen and heard on the sports field — but only as cheerleaders.

If this wasn't enough, the yearbook devoted pages and pages to all the boys' teams. Not just photos, but stats and play-by-play descriptions of just about every game each team played. And the girl's team, basketball, my team, I might add, had one page, and a note that it hadn't done so well because the coach had been sick.

Now when my sister and I changed over to an all girls' school — and I think there's a table of my classmates here today — I found a different situation: Athletes were part of the cool crowd. But this was still unusual in those days.

In my experience, and that of my teenaged daughter, I think a great deal has changed for everyone, in ways that give me much hope for the future. One significant change, I believe, is the increased emphasis on sports for girls — beginning with the incredible growth of local recreational teams.

Those of you who have daughters enrolled in soccer, baseball, volleyball, basketball — or even rugby in the case of my daughter – have likely seen first hand the valuable "life's lessons" that can be learned in sports: not just how to be graceful winner but how to swallow defeat and move on.

Because we all lose lots more battles than we win. And knowing how to adjust your plans, re-assess your goals and analyse your team's strengths and weaknesses is essential in today's workplace.

I think my daughter's generation will be better equipped than ever before to do so.

You might have seen a recent article in The Globe and Mail about a Harvard study on resilience⁵. People, who are more resilient, better able to put things in perspective, have happier, healthier lives. What's more, a key finding was that resilience could be learned.

I think experience with team play will help develop a sense of perspective that will breed a very healthy resilience to adversity and defeat.

Not all young girls are attracted to sports, of course, and as parents we should seek out the best venues to develop each child's unique talents.

However, I believe that, compared to my early days, girls are being given important opportunities to learn early leadership skills, through sports and other activities. This bodes well for the future — and reinforces the important role we have as parents.

What else can we do? As employers we should consider means to adapt for the roles women tend to play. This may mean flex hours for people who are primary caregivers for the very young or the very old; or in some job categories, the ability to telecommute. These are among the things the banks adopted early on.

Another way we can break down barriers is, as senior executives, to donate our time and expertise through mentoring.

The communications industry, for one, has a number of excellent mentoring programs available — as do other sectors I'm sure. In my career, the mentoring came from both men and women, and the individual and the circumstances at hand uniquely shaped it.

In one case a senior lawyer pressed me to challenge myself by giving me the most complex files. In another, a senior executive mentored my ability to fit in to an entrenched corporate culture by forcing me to lead a workshop with colleagues from totally different parts of the organization. And finally, one of my colleagues impressed upon me the need to put myself in other people's shoes when I was considering a problem. I'm grateful to each of these three: for the intellectual challenge, the organizational challenge and the lesson in humanity. These were three extraordinary individuals who acted generously and outside any formal program.

Mentoring is vastly important. It comes through formal approaches, and through generosity of spirit. So those of you in the position to participate in either, I encourage you to do so.

Looking ahead

Looking ahead, I am optimistic about the chances for young women as they move into and upwards in the workforce.

But our work isn't done. We need to clearly and vocally articulate the case for women's advancement - to senior management and to boards of directors - to chip away at, and, I hope, break down attitudinal barriers that still remain.

And no one said it was going to be easy. For these women who aspire to these senior roles, they will have to drive themselves, work long hours, and be strategic in the choices they make. At the same time, I am suggesting we have a role to play for others, as parents, as employers, as mentors, and as advocates for change at the highest levels.

Looking ahead I know that we will be resilient and continue to make a difference.

Thank you.

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1. Table 282-0010 — "Labour force survey estimates (LFS), by Standard Occupational Classification," Statistics Canada. From Quick Takes — Canadian Women, Catalyst fact sheet.

2. "2002 Catalyst Census of Women Corporate Officers and Top Earners in Canada," Catalyst, 2003.

3. "How Zig snapped up the Molson Canadian account — Creative directors' vision wins out", Report on Business, Keith McArthur, The Globe and Mail, 3 November 2004, B1

4. "Women climbing the ranks at banks", Shirley Won, The Globe and Mail, 8 November 2004.

5. "Want health and happiness? Be resilient", Rick Lash, The Globe and Mail, 5 November 2004.