The only way is up
Research shows that having more women in the top mining jobs can bring bottom-line benefits. Guy Richards reports.
It is a sad fact that, even in this day and age, there is a glass ceiling in many industries that bars women from rising to the upper rungs of the corporate ladder. Yet in mining – perceived as one of the most ‘masculine’ of sectors – companies are starting to embrace the need for greater gender diversity at board and senior management levels, and reaping the benefits too.
That’s not to say mining stands out as a beacon of equal opportunities. According to a study published this year by non-profit body Women in Mining (WIM) UK and accountancy firm PwC, of the 500 mining companies it surveyed, only 7.9% of board members are female and, within the top 100, only 11.1%. However, it says, over the past three years, both figures represent an improvement of about 3% – movement, albeit slow, in the right direction – although it adds that there remain fewer women on boards in mining than in most other sectors globally.
In pushing for greater gender diversity, the report says research shows that mining companies with a greater proportion of women on their boards achieve better overall profitability and share price performance. ‘Over a three-year period, we have seen a positive correlation between better dividend yield, earnings per share, enterprise value to reserves and return on capital employed, and gender-diverse boards in the mining industry,’ it says, although it concedes that ‘a correlation between two variables does not necessarily imply that one causes the other, yet the correlation is sufficient for us to take notice.’
Chair of WIM UK Amanda van Dyke explains why there is this correlation. ‘Our research, which echoed the findings in other reports, found that women tend to create an open and collaborative atmosphere, and are more likely to consider and balance the needs of multiple stakeholders,’ she says. ‘Research has also shown that, in general, women are more risk-aware than their male counterparts. The nature of the risks women take are slightly different from those taken by men, and women balance more factors in the decision-making process.
‘In terms of the mining industry, these attributes are particularly important given the multiple stakeholders involved in mining operations, such as local communities, employees, unions, host governments, NGOs, shareholders, financiers and so on. Mining companies rely on these stakeholders for their social licence to operate, as well as business-as-usual operations, so a balanced approach to corporate governance means that consideration of stakeholders is embedded at all levels of the organisation.’
The report also looked at the issue of sustainability in terms of future talent in a mining company, finding that having more women on the board can lead to having more women in senior management so, as well as serving as role models, they are a reminder that opportunities do exist for women in leadership positions.
Embracing the challenge
Companies such as AngloAmerican, Goldcorp, Lonmin and Newmont are now demonstrating a commitment to gender diversity. A spokesman for AngloAmerican says, ‘We certainly see the diversity of our board as a business imperative, and we’ve always sought to recruit people with the relevant skills and experience to make a difference to the board’s deliberations.’ To that end, three of its 12 board members are women, and in 2014, women made up 23% of management-level staff, the aim being to increase this further to more than 30%.
Goldcorp has a number of initiatives underway and, while it says it would be difficult to attribute improved financial performance to any one of them, it does accept that research generally shows companies perform better when they have a greater gender balance One such initiative, launched in 2010, is called Creating Choices, an enterprise-wide mentoring programme that covers topics including leadership. More than 1,200 women have now completed the programme, and its success led Goldcorp to launch a second phase of the programme, Growing Choices, in February 2015, to help women brand themselves as leaders and develop high-level career goals.
In March 2015, the Canada-based company also signed up to the Catalyst Accord, a cross-industry initiative to increase the representation of women on boards to 25% by 2017. It does already have two women on its board of 10, but Goldcorp is the first mining company to formalise its support for such a commitment.
Lonmin, meanwhile, runs a number of programmes to ensure, ‘access to senior roles is open to all’. However, with its focus of platinum and PGM mining in South Africa, Lonmin has to comply with the country’s Black Economic Empowerment legislation, which stipulates that large companies must ensure at least 26% of the business is owned by historically disadvantaged South Africans – the aim being to redress the inequalities of the old apartheid system.
Perhaps working on the basis that it’s best to catch them early, one of Lonmin’s programmes in South Africa is its Bursary Scheme, which is aimed at helping students gain qualifications in a range of mining-related engineering disciplines, such as geology, metallurgy and chemistry. The bursaries are offered to students wanting to further their studies on the basis of a service-binding contract after graduation, and for 2015 there are 98 students on the scheme, 36 of whom are women.
Lonmin also offers an Experiential Learning Programme to help students who need to complete practical training as part of their university requirements. Covering engineering and chemistry disciplines, the programme consists of a 12-month fixed-term contract with remuneration, and includes the payment of tuition fees during the learning period.
Gold major Newmont has taken its own initiatives, increasing female representation among its executives from 13% to 15% last year and expanding its employee-led Business Resource Groups to focus on the development of women. It has also received recognition in the US by the 2020 Women on Boards campaign for the strong female representation on its board – three out of nine members – and three of its employees have been nominated by WIM UK for an Inspirational Women in Mining award, one of whom is the company’s executive vice-president of sustainability and external relations.
One final example comes from Rio Tinto Group, which has set itself a goal to have women make up 20% of its senior managers by the close of 2015, up from 14% last year.
Clearly, there has been some progress in the past few years, but the mining companies themselves agree that there is more work to do, and in fostering the further advancement of women onto mining boards and into senior management, WIM UK proposes a number of steps.
First, it says, senior managers must ensure that gender diversity as a corporate imperative trickles down into all aspects of the company. Second, showcasing female role models will encourage more women to aspire to senior-level management roles, eventually reaching board-level positions. Strong role models will also encourage more women to join the industry, increasing the supply of potential managers and strengthening the talent pool.
Next, mining companies should set up inclusive development programmes, such as corporate leadership development, and sponsorship and mentorship programmes – something Goldcorp is already doing. Companies can therefore encourage women leaders by adopting sponsorship or mentoring where they actively seek to balance the gender divide. In doing so, female high-flyers from within the industry can be identified and nurtured, and ultimately rewarded for their achievements.
WIM UK goes on to say that recruitment should be based on general market experience as well as skills. Competency-based rather than industry-based recruitment, which focuses on how well a candidate can execute a role, should be the basis for hiring. For boards, recruiting should be conducted outside traditional mining networks on the basis of board criteria, and not only on board and CEO experience within the mining sector. As it points out, it is not uncommon these days to have board members from other sectors, such as the automotive, aerospace and telecoms industries.
The last step it suggests is to implement strong but flexible work arrangements that meet the company and the employees’ needs. This can enhance corporate performance while ensuring that employees stay motivated. Establishing systems that promote a work-life balance is particularly important to the mining sector with its lack of female directors and CEOs, as it actually increases employee productivity while making employees feel they can manage both work and home life needs.
In any industry, change needs to bring with it a business case – in mining, the case for greater gender diversity appears to have been made.