Unpacking why diversity in leadership can help produce better outcomes and why we need to get there
In 1967 women made up around 37 per cent of the Canadian workforce. Today they represent 48 per cent of workers. In that time we have seen tremendous progress made by female leaders across industries, yet on international women’s day Katie McNulty notes that there is still so much further to go.
McNulty is the manager of pension solutions at CAAT Pension Plan. In her career she has seen milestones crossed. They including the appointments of Barbara Zvan as the President & CEO of University Pension Plan Ontario, Angela Goodchild as VP of service delivery at CAAT, and Celine Chiovitti as Chief Pension Officer at OMERS. Nevertheless, she says that pension leadership in Canada still does not fully reflect this country’s diversity, in terms of both gender and ethnicity. She argues that by pushing for greater diversity in leadership, the pension industry can serve its members and mandates better.
“Why is it important to have a diverse group? It’s pretty simple: diversification,” McNulty says. “Anybody familiar with investing knows that when you have a diversified portfolio you produce better outcomes because the assets are not correlated to one another. The same can be applied to leadership and decision making roles. That diversity is added perspective that will give you a competitive advantage.”
By elevating more women and other diverse voices McNulty believes that pension funds and asset managers will be able to look at problems from new angles and find more creative solutions. People from different backgrounds can more quickly identify problems that impact them and their communities, and they can find new opportunities as well.
Women are key to creating that diversity, in McNulty’s view. At around 50 per cent of the population, McNulty says that women are “the largest marginalized group.” Including more women in leadership roles should allow for other diverse voices and backgrounds to be included as well.
Achieving greater gender parity in leadership requires purposeful and intentional strategies. McNulty looks at the 50 – 30 challenge, an initiative co-created by government, industry, and civil society aimed at supporting organizations as they work to improve overall equity. Marketing and communications play a key role too, as the elevation of female voices and female stories can serve to inspire more women to get involved in any industry. This is especially the case in some aspects of the financial services industry which can appear male dominated. Profiling female leaders can serve to inspire the next generation of women to take on the challenge of leadership.
McNulty accepts that organizational leadership is the product of decades of work. Encouraging more women to become leaders in the pension industry means supporting young women throughout the stages of their careers when they might face setbacks or pressures pulling them away from work. The end result being a greater depth of talent from diverse backgrounds ready to take on leadership roles.
There is a push within the pension industry for investment policies to better reflect social norms and members’ desire for positive impacts. While that has manifested in investment mandates limiting exposure to fossil fuels or weapons manufacturers, it has not extended as far into the diversity of the pension fund managers. McNulty sees some impact being made by this member advocacy, but notes that there is still further to go and that as more millennial and Gen Z members join pension plans they may come to push for greater progress.
As plan sponsors look at the pension industry and the place of female leadership within it, McNulty thinks they can become advocates to. By pushing for greater diversity of perspective among pension fund leaders, they can help produce a better outcome for their members.
“The outcomes that can be gained from diversity and inclusion can certainly be beneficial. For the amount of effort it would actually take, I think there’s a solid ROI on that investment,” McNulty says. “There are many ways you can achieve it. You can do proper candidate sourcing, train leaders from within, or create sponsorship and mentorship programs. Those initiatives can help propel diverse groups within organizations, remove biases, and create awareness. Those who are already in leadership roles, they can serve as the role models for those aspiring to achieve even greater things.”
