Companies lagging on gender diversity miss out on top talent

Diversity may give companies a vital edge in the competition for female talent in a tight job market, according to analysis from HESTA.

HESTA analysis of Seek's Laws of Attraction research showed that when focussing on company reputation as a driver of attraction, almost three quarters (73%) of Gen Z women (aged 18-25) said workplace diversity was a must.

Women in leadership also ranked highly, with nearly two in five saying this was a ‘must have’ for them that differentiated potential employers.

HESTA chief executive, Debby Blakey, said: “We know better gender balance in company leadership means better financial performance, better governance and stronger long-term company value, which can improve the performance of our members’ investments.

“But what’s apparent from the data is that it’s not just investors who value diversity, jobseekers do too.”

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The data also revealed that when focussing on company reputation, more than half (57%) of millennial women (aged 26-41) saw diversity as a 'must have' in choosing an employer, while 33% said they would be 'delighted’ if it was present in the organisation.

“There’s not a CEO in the country right now who doesn't have the talent challenge at the top of their to-do list and it’s forcing everyone to rethink how they can attract the best people,” Blakey said.

“Companies who fail to prioritise gender diversity risk missing out on this next wave of talent who are going to be tomorrow’s leaders.”

Blakey said investors wanted to see companies realise the performance dividend that came from improving their workplace diversity.

“Long-term investors like HESTA are focused on how companies are creating long-term value and their people are often their most important asset. If companies get diversity right it can mean better long-term performance and a stronger, more productive economy, which benefits HESTA members,” Ms Blakey said.

HESTA founded 40:40 Vision in October 2020 as an investor-led initiative to boost gender balance in the executive ranks of ASX 300 companies, bringing into sharp focus the need for companies to support their workers through better diversity and inclusion.

40:40 Vision is supported by industry partners Chief Executive Women, the Australian Council of Superannuation Investors, 30% Club and the Workplace Gender Equality Agency. The initiative has seen strong support from ASX300 listed companies with the current signatories having a combined value of $516 billion and representing close to 25% of the index.