Among the highlights of this year’s RSM annual conference was the inspirational presentation by Duncan Goose, founder and Managing Director of Global Ethics, owner of the One brand. Duncan shared his story as to how he took a business idea for bottled water from a chat with friends in a London pub, to the shelves of major supermarkets across three continents. The branding and business model is very powerful. Each One product funds a directly related project in sub-Saharan Africa. The profits from the sale of One Water go directly to fund water projects, while the profits from One Supersoftly Toilet Tissue fund hygiene and sanitation projects, and so on.
A profile of Duncan Goose in the Daily Telegraph earlier this week, addressed some of the issues which Duncan – and undoubtedly many other entrepreneurs – are grappling with right now. Businesses supplying the retail sector are feeling the squeeze as supermarkets reduce the number of brands they stock, and put pressure on the remaining brands to offer promotions. The rewards of doing business with a large multinational supermarket can be immense, but entrepreneurial businesses who do not manage the relationship carefully, can find that the coveted contract they have secured can be a curse almost as much as it is a blessing.
Partly as a consequence, One is diversifying into energy and financial services. This is a smart move, as not only does it allow One to shield itself against supermarkets rationalising their product lines, but it also taps into the current consumer disillusionment with energy and financial services providers in the UK. Duncan Goose thinks that customers buying electricity through One should also save £80-£100 on yearly bills, as well as doing some good. What’s not to love about that?
Duncan provided some fascinating insights into how his business has become so successful and alluded to some of the trade-offs that all small businesses have to make, such as how much profit should you reinvest to grow a business, balanced against how much you should distribute to shareholders? In One’s case though, the shareholders are communities in Sub-Saharan Africa.
It was a fascinating insight into a business and entrepreneur who many RSM members have said was one of the highlights of this year’s annual conference.
In the business arena today, local no longer exists – we live in an interconnected, globalised world where companies must think on an international scale. As companies realise the need to develop globally, diversity in the workplace becomes an integral component in creating and sustaining a competitive edge. Responding to these changes requires businesses to analyse and reassess ways in which they recruit and retain their staff.
This issue of diversity within companies and across industries has been the subject of much recent press coverage and discussion. The Forbes Insight survey on ‘Global Diversity and Inclusion’ found that diversity fosters innovation and attracts high calibre graduates, a conclusion that is interesting when considered alongside the International Accounting Bulletin’s (IAB) more focused probe into diversity in our own profession. The survey reveals some both expected and surprising stats and highlights the fact that, despite great changes over the last decade, the numbers of women at partner level still remain too low to provide true diversity.
Over the course of my career I have been asked several times about being a woman in the workplace. I used to believe there was no fundamental difference between men and women in business. Recently, over time and with experience, I have come to appreciate that there is an intrinsic difference in working styles and in how both genders approach tasks such as management and problem solving. And these differences are neither negative nor positive – they are simply differences.
A truly diversified workplace can create high value for a business. Looking beyond gender, into ethnicity and age, the stronger organisations are those that are forged through contrasting outlooks, values, opinions and creativity.
How do you achieve the right balance? The answer to this question will vary by organisation and by country. As with most things in international business, different countries will have differing opinions on what balance is right for them. Finding this level and developing a culture where diversity is sought and utilised is not an easy task for any organisation but, given the growing consensus amongst analysts and commentators that it encourages company innovation and vision, it is perhaps a worthwhile ambition. And with the current economic climate, every business needs to be as innovative as possible.
You may have seen the media interest around recent reports regarding a former female employee of KPMG US who is filing a $350m class action lawsuit against the firm. I read with interest the opinion of Arvind Hickman, the Editor of the International Accounting Bulletin, in his report about the case.
While this case brings to light that gender equality is still very much a corporate culture issue (certainly not restricted to the accounting profession), I believe it is equally important to recognise that gender imbalances are, albeit slowly, being addressed around the world.
Take our US member firm as an example. More than half of the employees at RSM McGladrey, are female. The firm is also listed in the 2010 Working Mother 100 Best Companies list, and importantly, 37 percent of its female workforce is in a senior management position.
The International Accounting Bulletin’s recent coverage of the KPMG US case provides some geographical trends worth sharing:
“Russia has the largest proportion of women at senior level with 37 percent.”
“In the UK, only 6 percent of senior positions were held by women in 1998. In 2008 this had grown to 20 percent.”
“In South Africa, 29 percent of partners and senior executives are women…”
These statistics are encouraging but there is clearly still a long way to climb on the equality ladder and large question marks on how to tackle this issue. Back in February I wrote a blog post about what impact the Lord Davies Enquiry might have on women taking senior management positions in UK boardrooms. There is global progress on these issues – slow change is better than no change.
Lord Davies, former chief executive of Standard Chartered, will tomorrow (24 February) announce recommendations resulting from his inquiry into barriers preventing women from taking top jobs in the UK boardroom. He is expected to call for a fifth of FTSE 350 board members to be women by 2013, rising to a quarter by 2015. Meanwhile, European Union Justice Commissioner Viviane Reding has targeted that 30% of board directors will be women by 2015 and 40% by 2020. To achieve this it is possible businesses will be faced with the enforcement of quotas.
Is this going to be a massive shift?
Only 12.5% of directors in FTSE 100 companies are women. This figure hasn’t changed in the last three years. In the US, women currently hold 15.7 percent of board seats at Fortune 500 companies. In both 2009 and 2010, more than 50 percent of these companies had at least two women board directors, yet more than 10 percent had no women serving on their boards.
There is an issue and it is right that it is being addressed. At the same time it is important to recognise that there has been great progress. Female executives now lead some of the world’s most recognisable companies and institutions - Carol Bartz at Yahoo, Irene B. Rosenfeld at Kraft, Andrea Jung at Avon, and until recently Dame Clara Hurse at the London Stock Exchange. On the global political stage, we have female leaders in major markets – Germany, Argentina and Brazil.
When I was appointed in 2005, I was the only female chief executive of a top ten global accounting network and so I am often asked my views on gender in the accounting profession. At RSM International we have firms all over the world and in most countries, the sector continues to be dominated by men, in terms of numbers. In many large markets, over 50% of accounting recruits are women yet we are nowhere near 50% in terms of partners. Progress has certainly been made with regard to retention of women but more remains to be done.
Across all sectors, I believe there is no one-size-fits-all global solution. While quotas may work in some countries and sectors, others would benefit from more work in investigating retention rates and this is likely to include analysing perceptions and attitudes within companies towards women at the top. I have always said that in business, results matter and getting the right people, male or female, is more important than quotas. But perhaps a little encouragement, like those being explored through the Lord Davies inquiry, would go a long way in driving change.