27 September 2023

Quota quandary: Could opting-out beat quotas for finding women leaders?

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Maria Slade* says new research suggests an ‘opt-out’ system for promoting women to leadership could be a better way forward than quotas.


For years women have been told that to break through the glass ceiling they need to be proactive, find mentors, deconstruct the barriers they create for themselves, and “lean in”, as tech boss Sheryl Sandberg famously argued.

Rather than putting the onus on women to create change, how about we debias the organisations they work for, Lata Gangadharan, an experimental economist at Monash University, told the New Zealand Association of Economists Conference in Wellington earlier this month.

Gangadharan has led a series of research projects on the topic and made some enlightening discoveries.

The most recent shows that using an “opt-out” mechanism to select leaders brings far more female candidates to the fore.

Gangadharan got groups of students to play a game comparing two methods of recruiting people for a leadership role.

In one round they used the traditional “opt-in” system of consciously putting their hand up for the job.

In another round they adopted an “opt-out” policy where everyone was automatically in the running unless they actively said they didn’t want to be considered for the promotion.

Under the opt-in system, more men than women put themselves forward, but with opt-out the gender difference largely disappeared.

While the opt-in process attracts people who are assertive risk-takers and rewards individuals who like to compete and win, the opt-out mechanism allows people with a far broader range of personality traits to rise to the top, Gangadharan says.

“With the existing mechanism we have, you have to do something active to become leaders, and that’s confronting or challenging for some people,” Gangadharan says.

There has been a great deal of interest in the results, she says.

Universities Australia has recommended opt-out in its guidelines for improving diversity, and a large Australian public sector organisation is now implementing an opt-out system.

Even after years of affirmative action such as quotas, female leadership numbers around the world remain dismal.

Worse, there has been a backlash against the quota system, Gangadharan says.

Gangadharan knows a bit about backlashes.

Another of her studies was in the Indian State of Bihar, which passed a law in 1992 requiring that a third of all Village Council heads be women.

Gangadharan and her team conducted a simulation game in a random selection of villages, forming groups of four comprised of two men and two women.

Each participant was given a sum of money and told they could put as much as they liked towards a common good project such as a school building or water purification project.

Alternatively, they could walk away with all the funds.

In half of the groups the position of leader was assigned to a woman.

The study found that the men in the female-led groups contributed much less to the collective projects than those in the male-led groups.

There was a backlash against female leadership, Gangadharan says.

Significantly, the backlash was stronger in villages where there had been at least one female head.

The conclusion was that men considered leadership and power to be a male domain and to upset that order was to encroach on their gender identity.

In short, the men were acting out.

Intriguingly the bias wasn’t as strong in villages where there had been several female heads since the quota system came into effect.

“They got used to it, but it took 15 years,” she says.

“It perhaps manifests itself in slightly different ways, but I think this problem of how you react when people go against social norms exists everywhere.”

“This impacts negatively on women’s leadership.”

New Zealand Women on Boards Chair and former Mayor of Hamilton, Julie Hardaker isn’t convinced by the opt-out idea.

“What we know is that there isn’t a shortage of candidates when we talk about board roles, and in fact there’s plenty of adequately qualified, exceptionally qualified women,” she said.

“The question really is why are they not getting selected and appointed?”

Women on Boards supports quotas because they are about making sure that those within the qualified pool actually get the job, she says.

“So, I’m not sure whether opt-out works there.”

“Because the challenge around the board table is getting those qualified women to be appointed.”

Asked about a potential backlash, Hardaker says she’s heard every argument under the sun.

“It’s common in these discussions, ‘Oh, there’s not enough to select from, we don’t get any capable female candidates, we don’t want to be compelled because then we have to appoint people who aren’t capable’.”

Even if organisations were to move to an opt-out system “they’ve still got to actually appoint”, Hardaker says.

“And I think this is where the debate is, what are the barriers to actual appointment, because from my perspective working in the governance space there’s no shortage of capable women.”

Dr Farah Palmer (pictured) is a senior lecturer at Massey University’s School of Management and is on the boards of both New Zealand Rugby and Sport New Zealand.

An unofficial “opt-out” system exists in sport and the public sector in the form of shoulder-tapping potential candidates, she says.

She can see the benefits of a formal opt-out mechanism.

At Sport New Zealand they are staying away from the term “quota” but instead suggesting targets for encouraging more women and girls and structural change.

“That does get away from that backlash a little bit,” Palmer says.

“There’s the underlying tension that by providing quotas we’re not having women get there on merit.”

“I don’t agree with the idea that there aren’t women out there with the right set of skills and experiences and networks.”

“There’s often a backlash, but I don’t think it’s warranted.”

* Maria Slade is The Spinoff’s Business Editor. She tweets at @SladeIrving.

This article first appeared at thespinoff.co.nz.

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