“Politics is the art of looking for trouble, finding it whether it exists or not, diagnosing it incorrectly and applying the wrong remedy,” so British writer Sir Ernest Benn said and Groucho Marx made famous.
People around the world have been concerned for some time about how to get women into top jobs in government and business. But a quota system? No — it wouldn’t be fair for men.
Stop the misdiagnosis. Put an end to the systematic application of the wrong remedies. Let’s face it: The right remedy is a quota system.
New Canadian Prime Minister Justin Trudeau got it right when he appointed a gender-neutral Cabinet. A self-proclaimed feminist, he picked a team of 15 men and 15 women “because it’s 2015.” But Trudeau’s enlightened way of thinking is still a rarity.
For too long we have assumed the barriers for women are education and opportunities. Encourage women to go to college and ensure they get entry-level positions in business and government, then everything would be fine. This is clearly not the case. We have had several decades of natural experiment to prove this doesn’t work.
More than half the people doing undergraduate college degrees are women. More than half of students going to elite law schools are women. Business schools are trending toward an equal balance of men and women attending.
Yet 5.2% of Fortune 500 CEOs are women; 20% of U.S. senators are women. Even when women find themselves in positions of power, they speak up less — and when they do speak, they tend to be viewed more negatively than men.
Many still hold out hope that a generational change is coming. But according to the World Economic Forum, we will have to wait until 2095 until there is gender equality in the workplace. Personally, I am not interested in waiting so long. By 2095, my 3-year-old daughter will be 83. By then, she may have to put hopes in the generation after her.
Likewise, according to one study, it may take nearly 500 years for women to achieve gender parity in the U.S. Congress at the current rate of progress.
One way to make sure girls around the world don’t wait that long is to impose a quota for women in top positions. This sounds controversial, but some countries have already done it successfully.
In Norway, France and Germany, there is a quota for the number of women who sit on corporate boards. There has been some talk about quotas in the boardroom and in politics in the United Kingdom, but it has been rejected in favor of a voluntary approach. In the United States, suggesting a quota system would be seen as utter madness. But is it really so crazy?
Critics say quotas only encourage compliance. However, studies have found that quotas are the single most important factor in explaining why some countries have high numbers of women in their parliaments. Critics worry that in countries with quotas, just enough women will be appointed to fill the quota and no more. The reality is that once a critical mass has been reached, countries with quotas tend to continue to appoint more women.
Opponents worry that quotas will decrease performance. The reasoning goes that if you are forced to appoint a number of women to top jobs you will not necessarily appoint the best and the brightest. These critics are partially right. Evidence shows that appointment of women to boards does drag subjective assessments of a company’s performance, such as analysts’ ratings.
However, appointing more women to a board tends to drive up objective performance metrics such as return on equity. What’s more, corporate boards with more women on them tend to have better working processes and higher levels of attendance. Firms with more women on the board tend to be more innovative.
Quotas don’t just encourage women to take a share in power in the cushy boardrooms. Evidence in India suggests they can also play a big role in relatively impoverished settings. In 1993, there was an experiment in more than 500 Indian villages. In half the villages, a quota of female leaders in the village council was imposed. In the other half there was no quota. Researchers found that in the villages where quotas had been applied, career aspirations for girls changed among parents as well as adolescents. In other words, both parents and their children were more open to less traditionally gender-defined roles. Education outcomes were equal. In villages where there were quotas, there was a reduction of discrimination.
What is probably most surprising is that quotas don’t just act as a bar to competition. They actually encourage competition. One study found that when there was a series of rounds of competition for selection to a post, only 29% of women chose to enter the competition. If you added a quota, 64% of women chose to enter. What was most interesting is that under both conditions, it was still the best candidate who won.
It’s time that we look beyond the politics at the evidence. Ensuring women have a truly equal share in power benefits everyone.
