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Gender Quotas or Targets: who wins?

by | Feb 24, 2021 | Policy, Feature

Victoria has led the way on Gender Equality legislation and investment for some time, taking a leap the Commonwealth won’t, by introducing a Gender Equality Act. It’s the first state-based gender equality legislation in Australia, and comes into force on 31 March, casting a wide net over the public sector, universities, local councils and other entities with more than 50 employees. It’s comprehensive and constructive and provides employers with a clear path forward to improve gender equality and strengthen the diversity of skills, talent and experience in a range of workplaces across the state. So, with the new legislation soon to become law, BroadAgenda asked Professor Carol T. Kulik, from the Centre for Workplace Excellence, University of South Australia, and Dr Jill Gould to explain the difference between ‘quotas’ and ‘targets’, and how best to use them with minimal collateral damage.

 

Quotas speed up progress toward gender equality

People often confuse gender targets and gender quotas. Targets are non-binding and set at the discretion of the organisation. Quotas are non-negotiable; they must be achieved by an organisation or penalties will apply. In general, quotas produce much faster – and bigger – changes in female representation than voluntary targets.

That’s good news, because having more women in leadership roles makes organisations better for employees, for customers, and for society. Organisations with more women in leadership roles exhibit smaller pay gaps and adopt more diversity and inclusion initiatives. They create more innovative products and services for their customers. They are more socially responsible and engage in more philanthropy.

Importantly, these benefits are only delivered by a critical mass of women in leadership roles – roughly 30%. That’s the beauty of gender quotas. In a short period, quotas put enough women in the right place to change organisations from the inside. Without explicit quotas, organisations appoint a very small number of women into leadership roles – and get a lot of reputational value for doing so. Given the low representation of women in senior management, even one female appointment is likely to position an organisation ahead of its peer firms. Demotivated to make additional female appointments, the organisation never reaches critical mass and internal change doesn’t get traction.

Gender quotas are designed to operate for a limited time; they have built-in obsolescence.

When quotas focus on the most senior roles in the hierarchy, the influx generates a trickle-down effect: The visibility of women in the highest levels of the organisations sends strong signals to the market, encouraging more women to apply to (and be hired into) roles in the leadership pipeline. As women progressively fill the pipeline, gender quotas become less necessary.

Quotas create stigma (but they don’t have to)

Given the value delivered by gender quotas, it is ironic that the people who are often least enthusiastic about gender quotas are the women who are their intended beneficiaries.

People who are targeted by gender quotas experience a stigma of incompetence: Their qualifications are discounted, they are over-penalised for minor mistakes, and they are disrespected by their peers and subordinates. What’s worse is that women can internalise these stigmas, so that talented women appointed in the context of a quota may lose confidence in their own abilities. Recognising these risks, women could opt out of roles in organisations subject to quotas – which defeats the entire purpose of quotas.

But negative perceptions are not inevitable. Organisations can manage these perceptions by careful implementation of gender quotas. When women consider career opportunities in the context of a gender quota, they can use these three questions to understand the risks they are facing.

How does the organisation “frame” its gender quotas to organisational stakeholders? Gender quotas can be interpreted that women lack essential traits and skills; they could suggest that women need special assistance to succeed in the organisation. These interpretations are especially likely when organisations adopt negative frames that present quotas as necessary to correct demographic imbalances. Positive frames that highlight the competitive advantages of gender diversity and the value of engaging a wide range of voices are less likely to evoke negative perceptions.

Has the organisation expanded its recruitment processes to support gender quotas in the final selection? When there are few – or worse, only one – women on a shortlist, gender is highly salient to decision makers. But gender quotas can motivate organisations to open their recruitment processes: to rely less on personal connections, to insist that recruitment agencies cast a wider net, and to advertise positions in a wider range of outlets. Gender-diverse shortlists ensure that every applicant is evaluated on his or her own merits; no single candidate is evaluated as a representative of their entire gender.

How does the organisation announce new appointments to organisational stakeholders? Competence stigmas are more likely to surface when a new appointment’s credentials are ambiguous, and stakeholders have doubts about a new appointment’s competence.

Hiring criteria for senior roles can be very abstract, and performance assessments equally subjective. In the context of gender quotas, organisations need to explicitly legitimise new appointments, by highlighting their credentials and the unique value they bring to the firm.

Carol T. Kulik is Research Professor of HRM, Centre for Workplace Excellence, University of South Australia; Dr Jill Gould is an HRM specialist and Online Course Facilitator at University of South Australia Online.

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