Can the aged care sector lead the way to a gender balance in CEOs?

Statistics have shown the gender balance in Chief Executive Officers (CEOs) may take more than 100 years more to reach, but with aged care’s feminised workforce the industry has a chance to lead the way to equity.

The Australian Government’s Workplace Gender Equality Agency (WGEA) data shows that across all industries a 50-50 split of female and male CEOs is a long way off, with the number of female CEOs currently only 22.3%, but aged care has already achieved this goal. 

The industry is well placed to role model gender balance for other organisations that are yet to reach a balance, but there is work to do.

Hello Leaders looked at what you can do to promote gender equity in your organisation and the practical steps that can be taken to further improve the employment scope for female CEOs.

Why do we need more women in leadership?

Having a gender balance in the leadership of an organisation leads to more successful business models according to research by WGEA and Bankwest Curtain Economic Centre.

Conducted in 2020, the research found an increase of 10% or more in female representation on the Boards of Australian ASX-listed companies, which led to a 4.9% increase in company market value. This increase in value was worth the equivalent of $78.5 million for the average company. 

The research also found:

• An increase of at least 10% in female representation on Boards led to a 6% increase in the likelihood of outperforming the company’s peers on three or more performance and profitability metrics, like return on equity or assets, sales per worker, earnings before interest and tax, or dividend yield
• The appointment of a female CEO led to a 12.9% increase in the likelihood of outperforming the sector on three or more of the same metrics

WGEA Director Mary Wooldridge said achieving the right amount of female representation in management across the aged care industry was an important way of strengthening the workforce.

“Action for gender equality in the workplace isn’t only the right thing to do – there’s a strong business case to back it up,” Ms Wooldridge said.

“Employers must realise that unless they make their workplaces attractive to and supportive of all genders they cannot, and will not, attract and retain the best talent.”

So what does the current situation look like in aged care and what can be learned from it?

The stats

Under the Workplace Gender Equality Act 2012, non-public sector employers with 100 or more employees must submit an annual report to WGEA. 

This includes aged care, which is grouped in the ‘Health Care and Social Assistance’ industry under ‘Residential Care Services’.

Across Australia 22.3% of CEOs are female, however in Residential Care Services 51% of CEOs are female, so the aged care sector is ahead of the average and already achieving gender balance.

However, Ms Wooldridge cautioned that this statistic shouldn’t be looked at out of context.

“Australia’s workforce is highly gender-segregated and aged care is no different,” she said.

“Women are 86% of the aged care workforce but only 51% of the CEOs.

“While this is much higher than industry as a whole, it is not representative of the proportion of women who work in the sector.”

To truly lead the change in representation across Australia there are a number of tell-tale statistics aged care needs to improve on.

While the CEO-focused numbers look promising, only four of 133 aged care organisations reporting to WGEA have a formal policy or strategy for the selection of board members.

Same job, same pay?

And then we arrive at the important issue of pay.

In 2021-22, only 30.1% of WGEA’s reporting aged care organisations had conducted a remuneration gap analysis, and while this percentage is growing, it is still far behind the 53.9% of organisations across Australian industries that have taken this step.

Of the aged care providers that did do an analysis, only 25% took action on the results, which is less than half of the 57.8% of organisations that took action across the industries.

According to the WGEA, the gender pay gap between female aged care employees and male employees was 22.8% in 2021-22, which has reduced by only roughly 2% in the past five years. But for Key Management Personnel specifically, it is 24.6%, which has reduced by only 1% in five years. 

The gender pay gap in aged care is greatest at the top level of management and reduces the further down the corporate ladder you look, to 5.6% for community and personal service employees.

So if there is balance at the top level of aged care management, why are female CEOs being paid the least compared to their male counterparts?

Statistics on the formal policies and strategies of aged care organisations could provide an answer.

In 2021-22, of the aged care organisations that reported to WGEA:

• 2.5% had a formal policy for promotions 
• 3.4% had a formal policy for recruitment
• 2.8% had a formal policy for retention
• 1.0% had a formal policy that included objectives for gender pay equity
• 3.7% had harassment and discrimination training for managers

Strategies for improvement

There are tried and tested ways that aged care providers can build on the natural foundation of female representation that already exists.

The reason WGEA collects data on particular strategies is that these strategies are all seen to work.

So writing up policies and strategies for these areas of employment is a good first step for an aged care provider, including:

• Strategies with objectives gender pay equity
• Policies on promotions
• Policies for retention and recruitment
• Training on harassment and discrimination

WGEA also supports setting gender equity targets in management and for boards, although progress towards these targets does need to be measured and those responsible for appointments need to be held accountable for the targets to have meaning and results. 

According to the Agency, organisations that have set consistent targets for appointing women on boards increase the percentage of female Board members at twice the rate of organisations without targets.

Employment flexibility is also key to putting in place supports that will help talent already working in your organisation to move into the higher up leadership roles.

Of the CEOs working for Healthcare and Social Assistance organisations, 95.8% work full-time, while at the senior management level 85.3% are offered full-time and 14.1% are part-time.

But nearly three-quarters of the aged care workforce (72%) is employed part-time, while 10% are employed full-time and 18% on a casual basis.

This affects the number of women that can work their way up from those lower level part-time positions to a full-time senior management or CEO position.

Ms Wooldridge explained, “Too many highly qualified, capable women work in less senior roles or fewer hours than they would like or are able to because they can’t find an employer who supports genuine flexibility in those roles.

“Traditional views of leadership and management mean women are likely being passed over for senior roles, in part, due to their being employed on a part-time basis.

“Three-quarters of the aged care workforce are employed part-time, yet Agency data for Health Care and Social Assistance shows management and executive positions are more likely to be offered full-time.”

Ms Wooldridge said greater flexibility in employment is what the aged care industry needs to improve the number of women in leadership, because research shows that when women are supported to work how they want to or need to can overall improve the outcomes of a business. 

How does your organisation address gender equity? Tell us in the comments below.