Eliminating the Gender Pay Gap Would Add $105 Billion to Canada’s GDP
- Access to education is a key pillar for an inclusive society; Canada needs to do more to ensure everyone has access to all levels of education. Creating an enabling environment for innovation is also crucial.
- The Canadian private sector should target at least 30% female representation in senior management roles in order to build momentum for gender equality at the top.
- Young entrepreneurial Canadian women should develop skills in the STEM fields, develop scale in their business proposals and seize the opportunity to be change makers.
Although Canada is a small nation, it has historically been influential in peacemaking and international negotiations. It should now be playing a leadership role in promoting gender diversity, inclusion, multiculturalism and international trade, which are all essential for long term success.
Where does Canada stand on the global scale when it comes to gender equality, diversity and inclusion?
Canada and its Prime Minister are taking a leadership role in the world when it comes to diversity and inclusion in our various ecosystems. Canada is probably relatively well positioned compared to other countries around the world. However, there is still a lot of work to do. We have been able to make some good progress; in the early 1980s, less than 10% of the CPAs in Canada were women. Today, it is a completely different situation. Having said that, gender equality at the top level of organizations seems elusive even now. Moreover, while more women are becoming entrepreneurs, the percentage of female-owned businesses is still only 15%. To have some sort of critical mass and momentum, we need 30% female representation at the board level, executive committee level or in entrepreneurship. When you have at least 30% of women on a board or an executive team, you start to get some real diversity. That is exactly what the 30% Club Canada is aiming for: to include both board Chairs and CEOs to achieve better gender balance at board level, as well as at senior management levels.
“To have some sort of critical mass and momentum, we need 30% female representation at the board level, executive committee level or in entrepreneurship.”
For what I call state corporations or government-owned organizations, which is the case of Investissement Québec, quotas are a very good tool for increasing female representation. Since they are financed by public money, their boards should represent the population. But, I would not recommend quotas for public corporations on the stock market because you need to factor competencies, experience, and geographical diversity while selecting board members. What you need to do there is to establish important objectives and 30% female representation on boards is a basic objective. It can be more than that.
“If Canada wants to build a society that creates real value, it should place accessible education at the centre of national policies.”
Even though it has a small population, Canada has historically played an influential role in the World Wars and in UN Peacekeeping Missions. Canada’s history is essentially a study of diversity and inclusion. Many people who were not part of the first Canadian generations were able to immigrate, be included in society and be successful. As a result, they have been able to create immense economic and social wealth for Canada. Canada should advance the message of gender equality, diversity, inclusion and multiculturalism that will lead the world to success in the long term.
What is the potential economic impact of gender equality in Canada?
According to the PwC Women in Work Index, in 2016, the gap in compensation between men and women in Canada was roughly $19 for each $100 earned. If we equalize that number, this would add $105 billion to Canada’s GDP.
“In 2016, the gap in compensation between men and women in Canada was roughly $19 for each $100 earned. If we equalize that number, this would add $105 billion to Canada’s GDP.”
If we look at the economy of Quebec, one of the reasons we have been able to do quite well during the past 10 years is that more women were able to join the workforce through affordable childcare. Canada wide, if we can bring more women into the workforce at good positions, with higher representation at senior levels and with equal compensation, this would have a very positive impact on the GDP.
How can Canadian organizations move from diversity towards inclusion?
Diversity without inclusion still leads to the marginalization of diverse voices at the table.
If Canada wants to build a society that creates real value, it should place accessible education at the centre of national policies. Education is the equalizer; education is the lever that enables people to do what they want to do, to be independent, to think, to do things and to give back. Canada is doing well in that regard, but we need to be a strong promoter of accessible education.
“15 to 16% of small businesses and only 10% of large corporations are owned by women in Canada, so we do not have the critical mass we need for gender equality at this point in time.”
Secondly, we need to create a climate in which entrepreneurship and innovation can add value to education. An environment where people feel empowered to start and grow their businesses and benefit not just from domestic but also international markets leads to a positive circle. The last pillar of this ecosystem is democracy, which we should not take for granted.
What should Canada be doing to promote female entrepreneurship and access to capital?
Approximately 15 to 16% of small businesses and only 10% of large corporations are owned by women in Canada, so we do not have the critical mass we need for gender equality at this point in time. When you start to look at the sectors, women-owned businesses are mostly in the service and retail sectors, rather than the more promising STEM fields.
“Banks are very open to lending to women because they are fantastic from a risk management perspective, but they do not have scale in the businesses they run.”
In order to increase the number of women entrepreneurs, we need to do a few things. As the Canada-United States Council for Advancement of Women Entrepreneurs and Business Leadersrecommended, we should promote STEM fields to young women and girls as promising and attractive careers that are full of potential. Second, we need women to be a little bit bolder building their business proposal. Most of the time, women are extremely careful in managing risk, which is fantastic. On the other hand, sometimes they need to be a little bolder in order to move the business forward. They should not hesitate to reach out to capital markets and providers. Banks are very open to lending to women because they are fantastic from a risk management perspective, but they do not have scale in the businesses they run. So, we need to find a way to encourage women to develop networks that motivate them to be more demanding in business development. At the same time, the private equity and capital ventures spaces are highly male dominated, so we need more female representation in those areas.
If you had to give career advice to young women today, what would that be?
I am somebody who likes to seek advice. First of all, if you want to learn, you need to observe, identify people who can help, ask questions and listen to advice. I think that is probably one of my characteristics and it is certainly part of the success that I was able to have over time. I had many mentors throughout my career, most ofwhom were men. Having said that, I was able to identify a few female mentors later on in my life who were able to provide support and give me advice. I think mentorship is important, so I try to make time for young people who seek my advice.
“Change management, self-confidence and seizing the opportunity are all traits that we need to develop more in younger women.”
Another piece of advice I’d like to give young people is to seize the opportunity to change. Change is a source of opportunity, but some people are nervous about change. In my life, all the major responsibilities that I was given were in contexts where change was required. People were a little concerned and they needed somebody who was willing to take the risk of going into the change process. I took on these challenges because for me, they were a fantastic way to move forward. So, I would say that change management, self-confidence and seizing the opportunity are all traits that we need to develop more in younger women. Let us seize the opportunity when we get it, let us be bold and ambitious, and let us seek advice because most of the time, people will be willing to provide support and advice.