Progress isn't exactly rapid, but we are seeing signs of positive change. Photograph: Getty Images.
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Why gender diversity is about more than equality

A recent 12-country study of 393 companies found that women are still largely outnumbered in the non-executive director community, but found that the gender mix is improving.

Promoting diversity is not only morally positive, it makes perfect business sense. To draw on different backgrounds and experiences is to challenge the notion that one culture, behaviour, structure and practice is the right direction to take. It’s a healthy, constructive way of doing business that can deliver greater productivity and profitability

"Diversity" also takes many forms, and is never far from public scrutiny. Just recently, the World Economic Forum (WEF)’s annual meeting in Davos suffered a media outcry at the lack of women delegates, despite the forum’s best efforts to attract a diverse pool.

WEF’s purpose being to improve the state of the world by helping shape the international business agenda, it’s important that the ideas and issues as part of it are mixed - otherwise it quickly becomes a club where people think more and more alike. It’s exactly the same situation within organisations today. While short-term objectives can often be met by a group of similar people (who are naturally aligned and don’t need to be taught how to operate together), generating sustainable, long-term success requires more. Effective boards and teams need diversity for innovation and time and management to make the different opinions workable.

The gender discussions at Davos are mirrored in the Hay Group’s recent report Non-executive directors in Europe 2013, based on a 12-country annual study of 393 of Europe’s largest-quoted companies. However, while the study shows that women are still largely outnumbered in the non-executive director (NED) community, it also highlights how the gender mix is improving. In the last three years the proportion of male board directors has dropped from 87 to 80 percent. Within this, some countries are moving faster than others. Italian companies, for example, though they remain bottom of the league for gender diversity, have made comparatively great strides, moving from 94 per cent male directors last year to 89 per cent this year.

While the NED community is not responsible for running firms, they are highly influential in terms of challenging and contributing to overarching strategies and in ensuring ethical standards of conduct are met in the pursuit of corporate objectives. It’s vital, therefore, that they represent a broad range of thinking which is often acquired through a more diverse group of people.

However, while women are securing more NED roles, the study shows they still earn less than their male counterparts. Two years ago the average pay gap was seven per cent. Last year it was nine and this year it has risen to 10 per cent. How can this be? Well, NEDs are paid fees for being members of the board, and typically get extra fees for chairing or belonging to other board committees, such as audit, remuneration and nominations. Women are even more underrepresented on these committees than they are on the boards (more than half of European companies don’t have a single woman on the audit committee, and the same holds true for remuneration committees). As a result, they end up earning less than their male peers and, crucially, the committees driving much of the board agenda do not benefit from diverse viewpoints.

Gender might grab the headlines, but diversity is a far broader issue. Boards are becoming diverse in a number of ways, driven by the reality that we are all getting more and more international. Fewer directors, 66 per cent at the median, are from the same country of company listing or headquarters; a fall of three percent on last year. Countries like Switzerland, the Netherlands and the UK, which are very open to international trade, often have half the board with an international profile. We’re talking gradual change here, but this does show a movement towards an increasingly healthy combination of ethnic, cultural, educational and professional backgrounds being funnelled into the leadership, strategy and direction of organisations.

So while progress can hardly be described as rapid, and the gender pay gap still needs bridging, we are now seeing signs of change. Just as WEF is likely to take a hard look at how it attracts a wider  audience at Davos in 2015, companies need to consciously consider and examine the formation of its teams. It won’t always be plain sailing - different views naturally lead to disparity and debate. However, the potential gains in terms of scrutinising behaviour in business, challenging perceptions, curbing excess in certain sectors and encouraging wider change across companies to improve working life, reward and benefit for all, are well worth the effort.

Carl Sjostrom is the Hay Group's Regional Director, Executive Reward, Europe

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Theresa May can play big fish with devolved nations - in the EU she's already a nobody

The PM may have more time for domestic meetings in future. 

Theresa May is sitting down with representatives from Scotland, Northern Ireland and Wales on Monday to hear their concerns about Brexit. 

For the devolved nations, it is the first chance since the seismic vote in June to sit down at a table and talk to the Prime Minister together. 

May has reportedly offered them a "direct line" to Brexit secretary David Davis. It must be a nice change for her to be the big fish in the small pond, rather than the small fish in the big pond that everyone's already sick of. 

Because, when it comes to the EU, the roles of Westminster and other nations is reversed. 

Brexit was small potatoes on the menu of Theresa May’s first European Council summit. It may hurt British pride but the other 27 heads of state and government had far more pressing issues on their plate to worry about.

So, it was an awkward debut Council evening meal of lamb and figs for Prime Minister Theresa May and dinner was served with a large reality check.

As May was later asked at her press conference, why would anyone listen to someone who already has one foot out the door?

Britain is in limbo until it triggers article 50, the legal process taking it out of the EU. Until that happens, it will be largely and politiely ignored.

May’s moment to shine didn’t come until 1am. She spoke on Brexit for “five minutes maximum” and said “nothing revolutionary”, EU sources briefed later.

May basically did that break-up talk. The one where someone says they are leaving but “we can still be friends”. The one where you get a divorce but refuse to leave the house. 

It was greeted in the way such moments often are – with stony silence. Brexit won’t be seriously discussed until article 50 is triggered, and then the negotiations will be overseen by the European Commission, not the member states.

As became rapidly clear after the vote to leave and in sharp contrast to the UK government, the EU-27 was coordinated and prepared in its response to Brexit. That unity, as yet, shows no sign of cracking.

German Chancellor Angela Merkel later damned May with faint praise. She hadn’t said anything new but it was nice to hear it in person, she told reporters.

Merkel, as she often does, had a successful summit. She needed Council conclusions on migration that would reassure her skittish voters that the doors to Germany are no longer thrown wide open to migrants. Germany is one of the member states to have temporarily reintroduced border checks in the passport-free Schengen zone

The conclusions said that part of returning to Schengen as normal was “adjusting the temporary border controls to reflect the current needs”.

This code allows Merkel and her Danish allies to claim victory back home, while allowing Slovakia, which holds the rotating Presidency of the EU, enough of an excuse to insist it has not overseen the effective end of Schengen.

But Merkel’s migration worries did not provide hope for the British push for immigration controls with access to the single market. The Chancellor, and EU chiefs, have consistently said single market access is conditional on the free movement of people. So far this is a red line.

Everyone had discussed the EU’s latest responses to the migration crisis at a summit in Bratislava. Everyone apart from May. She was not invited to the post-Brexit meeting of the EU-27.

She tried to set down a marker, telling her counterparts that the UK wouldn’t just rubberstamp everything the EU-27 cooked up.

This was greeted with a polite, friendly silence. The EU-27 will continue to meet without Britain.

Francois Hollande told reporters that if May wanted a hard Brexit, she should expect hard negotiations.

Just the day before Alain Juppe, his likely rival in next year’s presidential election, had called for the UK border to be moved from Calais to Kent.

Hollande had to respond in kind and the Brussels summit gave him the handy platform to do so. But once inside the inner sanctum of the Justus Lipsius building, it was Syria he cared about. He’s enjoyed far more foreign than domestic policy success.

May had called for a “unified European response” to the Russian bombing of Aleppo. It was a break in style from David Cameron, who is not fondly remembered in Brussels for his habit of boasting to the news cameras he was ready to fight all night for Britain and striding purposefully into the European Council. 

Once safely behind closed doors, he would be far more conciliatory, before later claiming another triumph over the Eurocrats at a pumped-up press conference.

May could point to Council conclusions saying that all measures, including sanctions, were on the table if the Russian outrages continue. But her victory over countries such as Italy and Greece was only achieved thanks to support from France and Germany. 

The national success was also somewhat undermined by the news Russian warships were in the Channel, and that the Brexit talks might be in French.

But even warships couldn’t stop the British being upstaged by the Belgian French-speaking region of Wallonia. Its parliament had wielded an effective veto on Ceta, the EU-Canada trade deal.

Everyone had skin in this game. All the leaders, including May, had backed CETA, arguing the removal of almost all custom duties would boost trade the economy. Belgium’s Prime Minister Charles Michel was forced to tell exasperated leaders he could not force one of Belgium’s seven parliaments to back CETA, or stop it wrecking seven years of painstaking work.

As the news broke that Canada’s trade minister Chrystia Freeland had burst into tears as she declared the deal dead, everyone – not the first time during the summit – completely forgot about Britain and its referendum.

Even as the British PM may be enjoying a power trip in her own domestic union of nations, on the international stage, she is increasingly becoming irrelevant. 

James Crisp is the news editor at EurActiv, an online EU news service.