As illustrated throughout the magazine this issue, Monitor is celebrating the women who work with and in the equipment finance industry. But for all of the advancement that’s occurred in the last few decades as more and more women have become visible in the industry, there is still work to be done. Women currently make up about third of all active members of the Equipment Leasing and Finance Association, and only four of the companies and divisions on the latest Monitor 100 list are run by women.
Equipment finance is hardly the sole business sector that still struggles to achieve gender parity. After working for years with different companies and organizations primarily involved in STEM fields, Kara Sammet, Ph.D, the founder and principal of Gender Lenz, realized that recruiting women was only the beginning of the process.
“The pipeline has been an issue historically, but what really needs to happen now is a major shift in building up diversity and inclusion within companies,” she says. “The very first promotion is one of the biggest bottlenecks that we continue to see for women in business.”
Gender Lenz was founded with this focus in mind, looking not just at barriers women may run into at entry-level positions but in middle management, the C-level and beyond. The company consults, coaches and develops workshops for organizations and executives seeking to diversify but who are unsure where to start. While Gender Lenz’s foundation was built to support tech and engineering specialists, the lessons can be applied more broadly to other businesses.
Sammet believes this is also one of the best times to truly start pressing forward with diversity initiatives. “The research has been around for a while, but it’s really kind of snowballing right now to show the benefits [and] clear financial returns on investment in diversity.”
She references a recent ranking by the Wall Street Journal1 which examined the different diversity efforts by companies on the S&P 500, measuring each company’s rank by gender, age and ethnicity representation at every level of the corporate ladder, including board representation. The Journal then compared the financial outcomes of both more diverse and less diverse companies. The results came to much of the same conclusions as previous research: more diversity is better for the bottom line.
“The 20 most diverse companies had an average annual return of 10% over five years compared to a return of 4.2% for 20 of their lowest ranking peers,” Sammet says. “The top 20 also reported an average operating profit margin of 12% compared to 8% for the lowest ranking companies.”
She adds this is also beneficial for customer relations, as an increasingly diverse set of consumers should be reflected in an increasingly diverse workforce. “If you want to be able to be competitive and if you want to reach larger market share, you have to be diverse in your company makeup. That is how you can better reach this diverse consumer.”
So, with so much of the data supporting the need for inclusion and diversity of thought, the next question for industry then becomes what to do about it. For that, Sammet has some suggestions.
“I advise companies to build a task force comprised of people who are decision makers, who have influence and authority in the organization to get things done. And they need to be a diverse group,” she says.
Sammet additionally sees value in forming an employee resource group (ERG) focused on women, although it shouldn’t be relegated to just an informal social gathering.
“Run your employee resource groups just like you would run any other project in your organization,” Sammet says. “You have to manage it like a project, and you have to understand what the return on investment is. You’re going to have your milestones. There is benefit to social gatherings, but to be truly effective, you need to figure out what is in your power to do something about.”
However, the onus to solve any problems a company may have with diverse recruitment or advancement shouldn’t fall entirely on women, either.
“Usually, if you see imbalance, it’s not the women who have created that imbalance. [They] cannot be the housekeepers cleaning up the mess in their companies around gender,” Sammet points out. Which, she adds, can mean encouraging male allies to support and initiate many of these policies. “The folks who are in a task force who are going to make a difference are male leaders who have personal value [in equity], and they’re at a tipping point. They have enough power themselves, and they are ready to move their companies forward.”
Sammet also views gender inclusion as merely the first step forward, as members of other minority communities may face their own, unique challenges to advancement.
“Women’s experience in the system will be very different depending on their age, on their sexual orientation, on their race or ethnicity,” Sammet says. “So, we can’t assume that all women are the same or that they’re all experiencing the same thing. Because we know, for instance, that women of color face different barriers in companies than white women.”
Sammet finds this to be an area where other women who have already achieved some success within a company can take the lead and shape a diversity initiative in a big way.
“We’re seeing increased movement of women at the very top, but throughout the rest of the pipeline, things are stalled internally,” she says. Sammet recommends companies begin to create spaces like ERGs where women at all levels can feel comfortable discussing specific barriers they’ve run into, with women in higher-level positions able to share the ways those barriers can be overcome or toppled. She also finds that the creation of mentorship or leadership programs by women, for women can often help navigate some of that bottleneck.
She recalls, “I was in one company where they would set up a team to help other women practice different interview techniques within their company for the next step [and] helped other women prepare their performance reviews. [Almost like saying], ‘I made it past here. Let me show you how to do it. Here’s the secret to advancing in our company.’”
A mentorship program can also train both men and women on more-difficult-to-see issues like unconscious bias, which can create situations where leadership doesn’t even realize that they haven’t reached out to more intersectional groups, inadvertently closing them out of promotion tracks.
“One of the most important things is, again, bringing it back to how not all women are the same. Not all women are facing the same barriers. So, how can I help women who don’t look like me?” To answer that question as a manager, she says, start to ask how meetings are run and who benefits from them. “[Are you] giving fair feedback to everyone on [your] team? Does everyone have an equal opportunity to get performance feedback that lets them learn and improve? Are you creating space for everyone’s ideas to be heard and valued, whether or not they’re accepted? Look at who’s being heard and not heard on your teams and support those voices.”
While Sammet and Gender Lenz can provide the building materials for companies to start the work on diversifying their workforce, she emphasizes that this not a one-time solution, but part of an on-going process companies need to continue as they create a vision of what they value and what the eventual shape of their business will look like.
“Your values are your north star for action. Companies who … don’t have a strong value system, it’s hard for them then to develop out either their women’s employee resource group or any of the other initiatives that they want to do related to diversity inclusion, because they don’t have these values to build their story around,” Sammet says. “So, whether you are a company or an employee resource group, you need to articulate your values: why is this important? How does this relate to what we do and how we operate, how we treat each other, how things get done.” •
1Holger, Dieter, 2019, October 26, “The Business Case for More Diversity,” The Wall Street Journal, https://www.wsj.com/articles/the-business-case-for-more-diversity-11572091200