ANZ [ASX:ANZ] has gained around 0.5% at the time of writing, trading at $32.37. This morning, they peaked at $32.55. It’s an especially impressive start for the bank.
Wondering what helped this strong start? It could have something to do with ANZ’s latest set of research and policy measures.
ANZ has just released a new report entitled ANZ Women’s Report: Barriers to Achieving Financial Gender Equity. Its first conclusion isn’t that surprising: that you can’t force individual men and women to change, but you can do something about systematic bias. What’s particularly interesting are the stats that the research returned.
Drawing on sources from academia to NGOs, ANZ uncovered some surprising facts and figures. Most interestingly, over a lifetime, women earn about $700,000 less than men. That’s an average of $295 per week less, or $15,000 per year. Around 90% of women retire without enough money to fund a comfortable retirement. Stunningly, around 15% of all women are likely to experience poverty in retirement.
The study looked at several financially important stages in a woman’s lifetime, from educational performance as a young woman, through to leadership in the workplace, and finally retirement income. It found that girls and young women have incredible potential. They outperform boys in NAPLAN literacy tests, year 12 attainment, university enrolments, undergraduate and graduate degree attainment. That’s probably not news to you (or at least, it shouldn’t be. If you think that women are naturally less intelligent than men, please seek help.)
What’s interesting are the things that happen just before and just after uni years, to separate men and women. It starts with women choosing different courses. Then lower graduate salaries for women. Then participation rate during child bearing years. And discrimination at work during pregnancy, parental leave, or returning to work. Unpaid work is a burden on women, much more so than on men. Then average salaries being lower for women in the same fields, in the same jobs as men. And fewer women holding leadership roles where they can make a difference and influence other women in their organisation. The list goes on.
ANZ identified several ways they can help. They’ll start paying super on paid and unpaid parental leave up to 24 months, up from 12 months. Permanent and fixed-term female employees in Australia will get an extra $500 a year in their super.
The best news for customers is the free super advice that will be available for female customers with less than $50,000 in their super accounts.
Still wondering what all this has to do with investors? Well, chances are, moves to boost gender equality will benefit ANZ’s bottom line in the long run. Women return orders of magnitude more to an organisation than what they’re given in the form of measures designed to address gender imbalance. Simply put, women represent a pool of talent and perspective that businesses can’t afford to ignore.
That becomes even more important when it comes to senior roles within a company. Research from US firm Catalyst shows that companies with the highest percentages of women board directors outperformed their peers on all fronts, including return on equity, return on sales, and return on invested capital.
Research firm McKinsey & Co. publishes research under a series entitled ‘Women Matter’. Since research began in 2007, they’ve consistently shown links between company performance and leadership gender diversity. They’ve identified the styles and qualities women typically adopt in leadership, and how this positively influences that company performance.
Credit Suisse also regularly publishes research on women leaders in business. Late last year, they published ‘The CS Gender 3000: Women in Senior Management’. They found that, in the APAC area, companies with above average numbers of women on their boards significantly outperformed companies with below average female participation at board level.
Source: Credit Suisse
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In other words, higher participation of women in senior management is likely to be very good for ANZ. And ANZ is working to make sure that the available pool of female senior management talent is just as large as its male counterpart.
ANZ isn’t the only large cap on the ASX that understands the importance of women in company leadership. For example, all of the stocks showcased in our free report ‘The Five Best ASX Stocks for 2015’ have benefited from having women on their boards. They all have at least one woman board member. Most of them have three or four. All five companies have outperformed their respective market indices so far this year. Click here to find out how to get your free copy of this report, and discover the names of these stocks plus their ticker codes.
ANZ’s bosses are already looking forward to change. CEO Mike Smith said:
‘Promoting diversity and gender equality is a priority in our business. This includes pay equality and an equal representation of women in leadership roles. Much more still needs to be done though to achieve full gender equality in the workplace and while we recognise we’re not there yet, today’s announcement is about rethinking how we address the imbalances women face in the workplace and in retirement.’
Joyce Phillips is ANZ’s CEO of Global Wealth. She’s a veteran of the banking and financial services sector, with over 25 years’ experience. Commenting on the results of the research and ANZ’s plans, she said:
‘Women play a critical role in global economies – however our report shows they can still earn up to 36 per cent less than men and retire with around half the superannuation.
Over time, we believe these new measures will help improve the financial security of women at ANZ by directly targeting the areas of advice, superannuation and financial education.
We know women are at a financial disadvantage, however this research also confirms what’s really restricting the financial future of women is the inherent structural bias in the way the workplace, education, social and legal systems are established. There is an opportunity for us to address these imbalances at ANZ and to work to redesign the systems within both business and the community to support women’s success and financial wellbeing for the future.’
It will be interesting to see how ANZ’s new policies shape the business (to the benefit of investors) in future years. In the meantime, shareholders will be waiting with bated breath for the bank’s full year results, due out in just a few months.
Contributor, Money Morning
PS: If you want to make money from a company that’s being smart about gender diversity, and you’re looking for the right stock, remember to check out our free report ‘The Five Best ASX Stocks for 2015’. It’s full of insight from our editor Kris Sayce on five very different stocks, with one important thing in common.