Although the concept of ‘meritocratic’ companies is popular, studies suggest that unconscious biases influence decisions based on merit. How might the mining industry overcome these biases?
The need to improve diversity and inclusion in business has been on the agenda for Australian businesses for many decades. There have been plenty of widely published discussions on the topic, including a number within the mining and resources industry such as the Mineral Council of Australia’s Diversity Whitepaper (MCA, 2014) and Women in Mining UK’s Mining for Talent (WIM, 2015). The topic is not new and initiatives designed to increase diversity within the workforce aren’t either. Modern business leaders are becoming aware of the benefits that come from increasing diversity within their workforce, for both their own organisation and the broader industry, and some have started to act accordingly.
Diversity has been spoken about in the public space so many times that people regularly ask the questions ‘why do we still hear so much about gender equality?’ and ‘is gender equality still even an issue?’. It is difficult to comprehend, but it still is. Change has occurred in a number of areas directly related to diversity; however, any real improvement has been extremely slow to surface and, in many cases, equality for women in the workforce has actually gone backwards. So why is this the case and what can we do about it?
There are a number of theories regarding why there has been so little improvement. One of the theories that has only recently been spoken about in any real detail stems from the idea of merit or, rather, the lack of true merit.
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In 2015, the UN Women National Committee Australia released a whitepaper in conjunction with Autopia titled Rethinking Merit, which discussed the lack of visible change in gender equality despite employers promoting ‘merit-based’ hiring principles in Australia. The release of this whitepaper is an important step in the diversity discussion as the concept of merit continues to be a driving factor in how individuals are hired, promoted and rewarded in Australia. Rethinking Merit dissects merit and its role in maintaining the lack of diversity within the workforce and provides recommendations for change. The following is a summary of the whitepaper.
The meritocracy myth
Across Australia, there is a widespread belief that individuals are hired and given opportunities because they are the most experienced and suitable candidate. Australia is said to value ‘a fair go’, and the country has a strong legal foundation of anti-discrimination. It is not surprising then that those who live here think that there is a level playing field with equality and justice throughout society. Despite this, there is little to suggest that merit is applied effectively within a gender context, particularly with regard to the workforce.
Studies continue to show how humans apply a significant amount of bias in their everyday decision-making. This tendency to be influenced by internal biases results in people believing that they are making decisions based on merit when they are not. The meritocracy myth can be seen in many ways, including the following examples:
- The ‘Heidi versus Howard’ study, undertaken at the Columbia Business School in 2003, showed that when given a story of a successful entrepreneur, people thought more highly of the person when the name on the story was Howard. Even though the information they were given was identical except for the name, those asked to rank the individuals would prefer to work with or for Howard as Heidi was seen as ‘selfish and not the type of person you would want to hire or work for’ (Sandberg, 2013). This study has been replicated in a variety of different situations and suggests that successful women are seen in a negative light by both men and women, while the more successful men are, the more probable it is that they will be considered likeable by both sexes.
- In 2015, 6.5 per cent of CEO and Chair roles of ASX 200 companies were held by men with the name Peter, while only 5.75 per cent were held by women (Dent, 2015).
- A study showed that 96 per cent of ASX 50 companies had a male leader with an average height 7 cm above the national average for men. Of these, 20 per cent were above 190 cm, which, with only 3.2 per cent of the male Australian population being so tall, shows a strong bias towards very tall men being considered as better leaders (Tadros, 2012).
- In Australian male-dominated businesses, there is an ‘unstated promotion criterion that favours Anglo-Australian men’, with 90 per cent of male managers hiring or promoting other men. In comparison, women select equal numbers of males and females when making a similar decision (Piterman, 2008). This suggests that men consider other men to have more merit.
- A tendency for male musicians to be considered more skilled because of their gender has been recognised by major symphony orchestras. Blind auditions are now commonplace to ensure that hiring is based on merit. Since implementing blind auditions, the New York Philharmonic has seen the proportion of women jump from ten per cent of all new hires to 45 per cent (UN Women NCA, 2015).
- A study undertaken by Castilla and Benard (2010) shows that female employees are at a greater disadvantage in businesses that consider themselves a meritocracy than in those that do not. The results of the study indicate that in meritocratic organisations, male employees are favoured by management over their female colleagues, with significantly larger monetary rewards for the same outcome. This situation, where a focus on merit actually results in more biased outcomes, is referred to as the ‘merit paradox’.
Subjectivity and level playing fields
In addition to the aforementioned examples, two critical elements undermine the idea that a meritocracy exists in Australia. These are the need to recognise that any determination made on merit is subjective and the fact that women and men are not on a level playing field to begin with at work. UN Women NCA (2015) explains both elements in detail, but they can be summarised as follows:
- Although regularly thought of as objective, merit is subjective in both a theoretical and practical sense. When a decision about an individual is made on merit, both their past and potential performance is considered. Measures of potential are entirely subjective as they are quantified using the judgment of the person making the decision. Examples include ‘fit’ for the team, ‘suitability’ for a position and the likelihood to commit long term. When deciding about a candidate’s potential, decision-makers often judge people against their own experiences, usually settling on a concept of suitability that reflects the qualities that they have themselves. This goes some way to explaining why Australian leaders (predominantly Anglo-Saxon males) favour men with a similar background to their own.
- It is widely recognised that women are not starting from a level foundation at work. The majority of unpaid caring responsibilities fall to women, mentoring or sponsoring by senior males is usually given to other men and women are ‘less likely to be offered formal training and development’ (UN Women NCA, 2015). As the majority of business language and culture tends to be masculine, with females behaving in a masculine way thought of negatively, highly capable women often find themselves deterred from participating to their full potential. Relying on merit for people management does not take this into account when women are overlooked for a promotion because of a career break or working part-time, as they are not as well-known to management or they may not have partaken in as much professional development. There is also the issue of devaluing women’s contributions, where when a woman is promoted it is now considered to be ‘because she is a woman’ rather than because she is highly skilled to undertake the role.
Do we have diversity within the mining and resources industry?
The Rethinking Merit whitepaper is applicable to all industries wanting to increase their levels of diversity. Two things that are used to determine if a greater focus on gender diversity is required are workforce participation and remuneration equity. These measures indicate that the mining industry is seriously lacking in terms of diversity, as shown in Figure 1.
In addition to being the poorest performing industry in terms of gender diversity, Figure 2 shows that there is little representation of women in the mining and resources industry, with the exception of clerical/administrative and community/personal service roles. Female participation is particularly low in the areas of company leadership and operational roles. With low female participation, the industry is selling itself short. If you are only recruiting and retaining men, you are not recruiting the best talent as you are only considering half the talent pool. Evidence also suggests that diverse teams are better able to assess risk, and as female operators and technicians are generally involved in less incidents, lower female participation can result in lower safety performance.
In the mining and resources industry, the gender pay gap for full-time salaries is 17.6 per cent (WGEA, 2016). On average, women receive one-sixth less pay than their male colleagues. As shown in Figure 3, the amount varies significantly depending on the type of work.
Although in comparison to some other industries a gap of 17.6 per cent can be considered low, other industry-specific studies undertaken show that the figure for mining could be much higher. An example of this is the Australasian Institute of Mining and Metallurgy’s (AusIMM) Professional Employment and Remuneration survey, which showed that the gender pay gap for professionals was 27.1 per cent in 2014 (AusIMM, 2014). This is well above the 17.5 per cent gap quoted for the same group in the WGEA data.
Why organisations persist with the meritocracy concept
Most organisations in Australia, including those operating in the mining and resources industry, continue to persist with relying solely on merit. There are only a small number that recognise the existence of bias by implementing initiatives that are designed to overcome it, yet they still place a large focus on hiring, promoting and rewarding on merit. Companies persist with merit-based language in their hiring and promotion decisions due to a number of factors, including those at a systemic, social and individual level.
From a systemic perspective, the ‘deeply entrenched gender norms and expectations’ (UN Women NCA, 2015) that have been in play for so long see elements of bias constantly affecting decision-makers. With a persisting lack of diversity in leadership roles, the decisions leaders make and the people they encourage into senior roles are often people who fit their mould of who makes a leader, which, in many cases, means that the candidate has a resemblance to the leader. Discussions of ‘organisational fit’ continue to allow for traditional candidates to be seen as having more merit than diverse candidates. This then results in a continuation of this barrier to entry for other non-traditional groups.
It must be recognised that our current leaders have all been promoted and appointed under the current flawed system of merit. While some are aware of the fact that they have been boosted through their careers through the positive discrimination of decision-makers, most are not. This means that when challenging merit, it can quickly become a deeply personal discussion, with current leaders feeling that we are questioning their skills and ‘merit’. From a social perspective, Australia has always been thought of as a country where everyone is given ‘a fair go’. Our legal, educational and industrial structures have a foundation in this belief, and the mining and resources industry is no exception. There is likely to be some resistance in accepting that equality is not as entrenched as believed.
As explained in Rethinking Merit, individuals all have a desire to hold on to the concept of merit (UN Women NCA, 2015). The majority of people are brought up believing that they have control over their lives and that if they work hard, their efforts will be recognised. We hear many women commenting that they do not want to be promoted because they are women, they want to be promoted on merit. While this is understandable, the reality is that the current process of merit is not delivering fair outcomes or the best talent. Although such a belief is important due to its strong link to accountability and people taking responsibility for their actions, denying the existence of the advantage given to certain groups results in compounding the erroneous belief that the reason for women not succeeding is of their own making and is not due to bias.
Overcoming the barriers to enhanced diversity in the mining and resources industry
Making ‘people’ decisions based on the assumption that merit is an objective process has been shown to be ineffective at combating a lack of diversity. What can organisations do to ensure that merit still plays a role without excluding individuals who don’t fit the status quo?
The following four key areas of action have been proposed based on recommendations by industry organisations including the Minerals Council of Australia, Autopia and the UN Women National Council Australia:
- Leaders should recognise that enhancing diversity is critical for business and that the current merit process is being used as ‘an excuse for lack of diversity’ (UN Women NCA, 2015).
- Set diversity targets and hold leaders accountable for achieving them, including developing strategies for achieving the targets and publically reporting on progress.
- Use bias interrupters (such as unconscious bias training and anonymous resumes) to combat unconscious influences on decision-making, particularly within organisations that believe they are making decisions based on merit.
- Charge managers with the responsibility for engaging staff in why greater diversity and inclusion benefits everyone. Educate and support leaders to communicate the diversity business case, implement initiatives and manage more diverse teams.
Building on the recommendations made by Rethinking Merit and strategies implemented by a number of industry organisations the AusIMM’s Women in Mining Network has developed a holistic diversity strategy that can work alongside a merit-based decision-making process to maintain strong performance among employees, produce better diversity outcomes and enhance organisational sustainability.
For a copy of WIMnet’s diversity strategy document, please email Kate Hobbs via email@example.com.
Australasian Institute of Mining and Metallurgy (AusIMM), 2014. 2014 Professional Employment & Remuneration Survey [online]. Available from: www.ausimm.com.au/content/default.aspx?ID=593
Castilla E J and Benard, S, 2010. The paradox of meritocracy in organizations, Administrative Science Quarterly, 55:543-576
Dent G, 2015. There are more men called Peter leading ASX 200 companies than women [online], Women’s Agenda, 6 March. Available from: www.womensagenda.com.au/talking-about/item/5406-there-are-more-men-called-peter-leading-asx-200-companies-than-women
Minerals Council of Australia (MCA), 2014. MCA Gender Diversity Whitepaper [online]. Available from: www.minerals.org.au/file_upload/files/resources/education_training/MCA_Gender_Diversity_White_Paper_Summary_FINAL.PDF
Piterman H, 2008. The leadership challenge: women in management [online]. Available from: www.dss.gov.au/sites/default/files/documents/05_2012/report_march08.pdf
Sandberg S, 2013. Lean In: Women, Work, and the Will to Lead, p 40 (Random House Group: Sydney)
Tadros E, 2012. Top 50 CEOs head and shoulders above the rest [online], Australian Financial Review. Available from: www.edmundtadros.com/top-50-ceos-head-and-shoulders-above-the-rest/1005
UN Women National Committee Australia (UN Women NCA), 2015. Re-thinking merit: why the meritocracy is failing Australian businesses [online]. Available from: unwomen.org.au/wp-content/uploads/2015/11/Re-thinking-Merit-Whitepaper.pdf
Women in Mining UK (WIM), 2015. Mining for talent 2015: a review of women on boards in the mining industry 2012 – 2014 [online]. Available from: www.womeninmining.org.uk/wp-content/uploads/2015/10/WIM-REPORT-2015-FINAL.pdf
Workplace Gender Equality Agency (WGEA), 2016. WGEA Data Explorer – workforce composition – mining within all industries [online]. Available from: data.wgea.gov.au/industries/87