The Acumen of Gender Diversity

Most global companies outside of Japan have targets for increasing numbers of women employees, particularly in management. And even in Japan where women are often given short shrift, more global companies now have such targets as well. However, the leaders of the most successful companies I know achieve their objective by doing things right that have nothing to do with women at all, and their businesses and all staff, both men and women, are better off as a result.

If you are the leader of a business in Japan or anywhere else, whether your business is subject to diversity targets or not, below is what I advise.

Prioritize excellence, not diversity. The CEO of a major global European company in Japan, which sets targets for gender diversity like many other companies, insisted on hiring a woman for a senior vice president role. The internal candidates that were first proposed to him were all men, and they were not considered qualified. Yet if he had hired any of them for the role, no one in his organization would have complained. He sought the help of several of the large head-hunting firms in Tokyo, but each of their account managers said they would have to turn down the work unless the CEO was willing to compromise his standards in hiring a woman, or otherwise hire a man. No such qualified woman exists, or so they claimed.

The CEO was adamant, and refused to compromise excellence in his search. He finally found his candidate, but it took maybe two months longer than if he had compromised his standards and accepted one of the initial candidates proposed. The candidate he found was in fact more qualified than most of the men who had initially been proposed, and has turned out to be one of the most successful vice presidents who has ever held the role. Widening your field of candidates and not compromising your standards bears results.

Yet had the CEO compromised his standards, no one would have complained. HR would likely have considered it a victory just for having hired a women and nothing else, and the business would have been worse off as a result. While lack of diversity always indicates a compromise of excellence, ensuring diversity is no guarantee of excellence when diversity is the priority.

Excellence is never bounded by arbitrary traits such as gender, sexual orientation, race, religion, and national origin. An organization that restricts its people based on such traits cannot avoid turning away excellent people, assuming such people are even allowed through its doors.

You show me an organization that lacks diversity, and I’ll show you an organization that compromises excellence. Diversity, whether gender diversity specifically or any other kind, is no end in itself, but rather the natural result of prioritizing excellence. If your company has made diversity a primary goal, you are focusing on the wrong thing. It is prioritizing excellence that counts.

Improve working conditions for men first if you want to attract women employees. The most productive and effective managers in business I know, Japanese included, work the least. They work hard for sure, but they also have hobbies and interests outside of work. They go home at a timely hour. They routinely exercise and take care of themselves physically. They spend time with their families. They travel and explore the world during paid holidays, which they take without reservation. They spend time and their own money investing in their own education and professional development whether supported or encouraged by the company or not. They are interesting people.

It is the managers who routinely work overtime, regularly go out drinking with colleagues and customers, devote weekends to the companies, and are not around at home following the birth of a child who are the least productive and effective.

A Japanese company executive spoke of how difficult it is to make the company more attractive to women because work conditions effectively created a “boy’s club”—his words, not mine. In a marriage, looking after children often falls to the wife whether she works or not, he explained. So that makes it difficult for women to habitually work overtime, to go out drinking after hours with colleagues or customers and participate in rounds of weekend golf. He talked also about how men get only one week of parental leave following the birth of a child, whereas women would need much more, creating inequality of work burden and continuity of career.

So how do you make exceptions for women in the workplace, he pondered. My answer? You don’t.

None of the conditions this executive mentioned are attractive to women for sure, and at the same time none are particularly attractive to men, either! At best, men tolerate such conditions.

In my experience, most men—Japanese men included—would prefer to be home with their families rather than out drinking late at night or playing weekend rounds of golf with their bosses and customers, or just working late in the office. Once in a while is fine, but as a routine part of work is no fun for anyone, neither for men nor women.

In one non-Japanese company I know, the CEO made it company practice to hold no meetings later than 6:00 PM. He also eliminated overtime. At a Japanese company I know, late night drinking with customers and staff is discouraged so employees, both men and women can spend time with their families. The company’s top executives, even when they go out, never drink alcohol. While the company’s executives never tell staff not to drink, they demonstrate by example that it is OK not to drink.

Japan has the most generous paternity leave in the world second only to South Korea. At least by law, men can take up to one year of paternity leave. It is just that most men don’t. When asked, most men say they would like to, but don’t want to put a burden on their colleagues.

At yet another Japanese company I know, the CEO imposed paternity leave for male staff, and made sure that managers not only supported paternity leave for male staff, but also that there was no retribution against men who took it!

Do you want to increase productivity and effectiveness of staff in your company? Do you want to attract top women talent to your business? Start by improving conditions for men, assuming you have not done so already. As a leader, you have control over the working conditions and practices in your own business.

Assume women have lots of options for employment, because the most talented always do! Talented, ambitious women, particularly those with international skills, often seek employment with non-Japanese firms who value them for their capabilities, whereas many Japanese women have viewed their opportunities in Japanese firms more limited. Women have been a tremendous underutilized source of talent for non-Japanese firms.

At a recent executive roundtable, it was suggested that non-Japanese firms will suffer as they compete for women candidates. Yet this is a misnomer. All firms in Japan, whether Japanese or non-Japanese, will benefit. For non-Japanese firms, it is the best possible thing that can happen. As Japanese firms increasingly value female talent, more women will be drawn to entering the workforce with great expectations and ambition. More will invest in their own education and capability development as they recognize that investment will pay off rather than be ignored, and that will only help your firm.

If you think that only leaders of foreign firms in Japan, even now, are so enlightened as to recognize the value of talented women, don’t be so smug. Among my Japanese client companies, most of have recognized the same for years, and deliberately targeted talented women as candidates for employment. The number of such Japanese firms is growing.

It is hubris for any business leader to consider limited options for women as a primary advantage in attracting and retaining women talent. The best talent, female or male, always have options, and excellent people are never worried about not finding work. An excellent employee will leave your company without compunction if he or she feels opportunity for personal growth is limited. It is only the mediocre who worry about finding another job, and will cling to your company until the bitter end.

As leader of a single business, you have no control over changes in Japanese society. However, you do have complete control over changes in your own business. If you want to future-proof your business against upcoming societal shifts, make sure that your firm is investing in and promoting female talent in your business as if women have a plethora of great options, even if you consider this not necessarily the case right now. Someday soon it will be the case, and while your peer companies will be scrambling to deal with what will be a new reality for them, you will have already been there and moved beyond it.

In my experience, HR directors tend to view diversity and inclusion only in moralistic terms of equity and access to opportunity. Understanding strategic business implications requires a degree of acumen they often do not have.

When you take away business acumen from issues of diversity and inclusion, moralism is all that remains, and that phenomenon is by no means confined to HR. Make sure that it is not just moralism that drives your decisions. Use your business acumen when doing what is right, and you will get far better results.