As a Board Development and Executive Search firm, Fidelio has a clear understanding of the importance of diversity at the top table. Clearly diversity extends beyond gender but gender continues to be an important parameter.
The 2015 Davies target of 25% female representation on FTSE 100 Boards has been met (26.1% as of October 2015) and a tougher goal of 33% female representation by 2020 has now been set for the FTSE 350. There is recognition that particularly at the senior Executive level there are too few women above all in sectors like engineering, technology and investment banking.
Fidelio recently held the first in a series of Board breakfasts celebrating leading corporates making headway in ‘Achieving Diversity’.
We were therefore delighted to welcome Ian Iceton, Group HR Director, Network Rail, to speak at a recent Fidelio Board breakfast. Network Rail is one of the UK’s largest engineering companies and has made significant progress towards diversity at a senior level —with 27% female representation on the Board of Directors (3 out of 11 directors) and 25% female representation on the Executive Committee (3 out of 12 executives).
In the tried-and-tested format of a Fidelio Board breakfast, we asked Ian to address three key questions:
1. What are the specific challenges facing Network Rail in achieving diversity?
2. As an engineering company, what practical steps has Network Rail taken that have achieved greater diversity?
3. What are the recommendations for companies struggling with gender balance including in leadership roles, be it in engineering or other sectors with a lower ratio of women?
At the breakfast we were joined by Executive and Non-Executive Directors from a range of sectors, including engineering, automotive, financial services and not-for-profit. The interest in achieving diversity was palpable.
The Challenge
Network Rail owns and manages most of the rail networks in England, Scotland and Wales. It has 15,000 employees, as well as 60,000 sub-contractors, and 4.5 million people travel on their network each day. The company maintains 30,000 miles of track and 900 bridges, with an approximate £5 billion spent a year.
Given its firm rooting in the old economy, unquestionably Network Rail faces a number of challenges in achieving diversity, including:
- The challenge common to the engineering sector across the UK and Europe – a chronic shortage of qualified engineers both male and female. Indeed one of our guests, an experienced Chairman in the engineering sector, suggested that this is the major problem facing engineering companies and it has critical economic implications for the sector.
- Industry working practices and practicalities: the irregularity of shift work and remote work which also raise issues such as adequate toilet facilities; work-wear.
- And based on the above, an often negative perception about the attractiveness of career opportunities with an old economy employer.
While Fidelio’s discussion focussed on gender, we absolutely recognised the benefits of broader diversity and Network Rail was clear that it approached diversity in terms of broader inclusion.
Practical Steps for Achieving Diversity
Against this backdrop Network Rail has numerous, practical, diversity initiatives at multiple levels throughout the organisation as part of its five-year diversity and inclusion strategy: attracting talent from a diverse pool and achieving diversity within the organisation.
Despite the publicity surrounding the lack of female engineers in the UK, Network Rail has made considerable headway in addressing diversity at the entry level. As a consequence around 30% of graduates at Network Rail are female, half of whom are from an engineering background with a further third from ethnic minority backgrounds. This has been achieved by a range of measures including:
- Outreach to schools and universities: Network Rail has invested in apprenticeship and graduate programmes in an effort to shape views and attract new talent at schools and universities. For school children it is as much about challenging parents’ perspectives as it is the children’s.
- Making the proposition more attractive: The importance of female and ethnic-minority role models has been recognised and adopted by Network Rail—as well as inclusive advertising. Simple measures such as moving the apprenticeship scheme from a military base to a university-style campus have also driven the sense of inclusivity, and importantly the statistics, forward.
Embedding Change
Attracting an increasingly diverse intake is important but it’s just the beginning. Network Rail is also taking a number of steps within the existing workforce to ensure that diverse talent can flourish.
- What is measured is changed: Regular metrics and staff feedback are critical to progress. Engineering is a profession that likes to measure; work is often project based and at the outset of each project there is the opportunity to embed diverse working practices. Of course these are equally available to women and men and Network Rail has been pleased by the uptake of flexible working practices among its male workforce and not just by their female colleagues.
- Tackling unconscious bias: All organisations face a degree of unconscious bias, and Network Rail has invested in initiatives to develop inclusive leadership throughout the organisation. All line managers attend a practical leadership training programme on inclusive leadership which aims to be interactive and challenging; making full use of e-learning tools. Activity-based and stimulating programmes have been shown to be more effective than lecture-based or head-on initiatives which incite defensive reactions and can be counter-productive.
- Creating internal networks: Internal networks can also do much to feed into a broader culture of inclusivity. At Network Rail, networks for specific under-represented groups are actively facilitated (for female employees, ethnic minority backgrounds, LGBT and multi-faith). Since these have been introduced, complaints of bullying have shot up—reflecting an open environment. Each member of the Executive Committee is a patron of one of these network groupings creating an effective mechanism for escalating issues.
- Facilitating diverse solutions: In a practical sense, dialogue is critical for ongoing diversity. Network Rail’s Built Environment Access Plan (BEAP) enables stakeholders, such as disabled employees and buggy-users, to provide feedback directly to designers and architects to ensure inclusive infrastructure. Network Rail have found that encouraging staff to share their diverse perspectives has been critical in opening the eyes of all to the challenges faced by such groupings. Network Rail also stipulates a commitment to diversity and inclusion strategy in their contracts with suppliers and contractors.
Making it to the Top Table
Despite recent progress on diversity and inclusivity, there are still challenges to be overcome to ensure that talented women rise to the most senior ranks. Undoubtedly, the traditional challenge for many women juggling careers and family remains: women returners from maternity leave often struggle with career momentum. And importantly, Ian and our guests drew attention to the ‘confidence gap’. Women frequently consider themselves underqualified for senior roles and it can be a challenge to persuade very capable women to put their hat in the ring. Ian outlined measures Network Rail is taking to encourage capable women remain the course:
- Focus on potential and develop accelerated leadership schemes: At Network Rail, the Accelerated Leaders Programme aims to select rising stars on the basis of their potential to catapult their early career trajectory. These metrics of potential rather than experience have led to diverse outcomes and, through these role models, have created a feedback loop for inclusive leadership.
- Effective career planning / using career breaks to advantage: Network Rail is keen to enable senior executive women to broaden their experience. Ian provided a case study of a female executive from an operational background returning from maternity leave and being encouraged to move into a strategic side, thereby broadening her career experience and preparing her for leadership. Encouragement from the top is critical to empower senior female executives and support their ambition.
Paving the Way Forward
Embedding diversity requires buy in across the organisation. Wider dialogue and integrated communication, such as internal and external use of social media, are key in shaping culture and ensuring all voices are heard. But equally the tone from the top is critical and Network Rail’s CEO is a public advocate of diversity and inclusion.
Clear accountability, resting on robust metrics are critical for meaningful progress on diversity. Networks of support and discussion as well as the use of role models can also move the dial toward more inclusive leadership and organisational cultures. As the Royal Academy of Engineering have championed, diversity should be embedded in organisations and hardwired into business strategy.
Our guests around the table did debate the ongoing relevance of gender diversity. All agreed diversity is more than gender but also that gender diversity is critical and can serve as a proxy for broader debate.
Ian Iceton demonstrated that Network Rail, despite the challenges both perceived and real, is making considerable progress in achieving diversity. And we were pleased that Fidelio’s Board Breakfast, ‘Achieving Diversity’, prompted a broad discussion drawing upon Ian’s experience; the insights of Directors across a range of sectors; and Fidelio’s track record in Board Search and Development.
Fidelio continues to champion diversity with the flagship “A Seat at the Table” development programme empowering senior female executives for success to the top table and at the top table, now in its third iteration and next held on 13th – 14th September 2016 at Leeds Castle.
To learn more about Fidelio’s Board Development and Executive Search capability, as well as how Fidelio can ensure your company has the diversity of skills and experience needed within the top team to navigate change and complexity, please contact Gillian Karran-Cumberlege, alternatively call + 44 (0) 20 7759 2200.