A REPORT BY WOMEN IN MINING U.K. SEEKS TO MAKE THE CASE FOR THE INDUSTRY TO HIRE MORE WOMEN
By Jennifer Jensen, Assistant Editor
Currently, 5% to 10% of the workforce in the mining industry is female, the smallest of any large industry. It is also the industry with the fewest number of women on company boards, including the oil and gas industries. To most people, those facts are probably not the least bit shocking, especially since mining has historically been seen as a male-dominated industry. One group is trying to change that perception. And to do that, they first wanted to figure out why there was a lack of representation of women in the industry, specifically in senior leadership roles or as board directors.
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| Amanda van Dyke, chair of Women in Mining U.K. |
Women in Mining U.K., a nonprofit organization formed in 2006 to promote and progress the careers of women in the mining industry and one of many Women in Mining organizations across the world, partnered with PricewaterhouseCoopers (PwC) to co-author the report, Mining for Talent 2014, the second of three different reports that looks at gender diversity at the board level in the top global mining companies, as well as the connection between women on boards and the company’s performance. The report was sponsored by Rio Tinto, Anglo American and BHP Billiton. Data was collected on the number of women involved in senior levels of the mining industry, and the impact these women had on their company’s performance.
“This report is, in effect, our attempt at making the business case to the industry for why it should consider hiring more women,” said Amanda van Dyke, chair of Women in Mining U.K. and director for Europe for Palisade Capital Corp.
“Just as we have encouraged women to get more involved in mining, we have also sought ways to demonstrate to the industry the value of attracting female candidates; including detailing the impact on financial and business performance they can have,” said van Dyke and Stephney Dallmann, a director with PwC.
Fact and Figures
Along with the mining industry having the fewest number of women on boards than any other industry, the report also found that in the world’s top 500 listed mining companies, just 7% of all directorships were held by women. The top 100 companies had 10.3% female directors.
Although the report shows there was a 2% increase from last year of female board appointments to the top 100 global listed mining companies, the report said, “it is clear that the direction of change is a good one, but the pace is too slow, and it will take until 2033 before any target of 30% is reached.” This increase can be attributed to gender-focused legislative reformation, business case and the movement toward corporate social responsibility, the report added.
The report also found that only seven chief executive officers (CEOs) in those top 500 companies were female. And,out of the top 100 companies, only one has a female CEO, Kay Priestly of Turquoise Hill Resources.
Priestly said she never focused on the industry being male dominated, but always focused on her goal. “I was always focused on results, but did recognize early on the importance of relationships and networking,” she said. “Women often fail to recognize that.” Prior to joining Turquoise Hill, she was chief financial officer of Rio Tinto’s Kennecott Utah Copper Operations.
According to the report, out of the 106 female directors in the top 100 mining companies, just three of them hold more than one directorship. Out of all the 500 listed mining companies, there were 14 who had boards consisting of 30% women, with six of these being in the top 100.
“A company’s culture starts at the top, and I personally am always supportingthe advancement of women,” Priestly said. “Three out of our seven board directors are women.”
Compared to last year, when 46% of the top 100 companies had at least one woman on their board, this year that figure rose to 58%. In June, Glencore ended its position as the last remaining company on the London Stock Exchange’s 100 companies to have an all-male board when it appointed Patrice Merrin, former CEO of Sherritt, as a director.
According to the study, females are more likely to hold non-executive board positions, which account for 85% of all female positions within the top 500 companies, and they are nearly half as likely to be executives as males within the top 500 companies. However, this is consistent over all industries, the report stated.
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CEO of Turquoise Hill Kay Priestly, the only |
As for executive and senior management positions, in the top 500 mining companies, that percentage is 11.5%, compared with just 7.2% of women represented on boards. In the 101-500 companies, women fill 11.7% of executive management positions, which is higher than the 10.6% for the top 100, the report said. The types of positions these women held were also looked into. In the top 100 mining companies, women are employed in a wide range of roles, and 62% work in operations, legal and finance.
For the top 500 companies, South Africa took the lead with the highest proportion of women in executive management, with 21.4%, followed by Hong Kong with 15.1%, Canada with 13.7%, the U.K. with 10.5%, U.S. with 9.4%, China with 9.1% and Australia being the worst with 8.7%.
In Hong Kong and China, there were more women in executive management positions in the smaller companies, top 101-500, than the larger ones.
According to the report, in South Africa, legislation has resulted in a much larger number of women in executive management and on boards than the other exchanges. “The Companies Act in South Africa was amended in 2009, making it mandatory for the companies to disclose how board diversity is considered and the percentage of female employees in workforce and senior management,” the report said.
Within the top 100 companies analyzed in the report, Australia has six, including BHP Billiton, and within those companies 12.5% of directorships are held by women. Australia also has 70 companies within the top 101-500, and among those, women hold 5.4% of directorships.
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| South Africa ranks at the top of countries examined with the most females in executive management. |
Key Findings
One of the key findings in this report wasthe effect the number of women on a board had on a company’s performance. According to the report, return on assets range from -2.86% for all-male boards,-0.88% for one woman on the board, and +6.40% for boards with two or more women.
“Women on boards in the mining industry are correlated with higher profit margins, higher return on assets and higher average enterprise value/reserves,” van Dyke said. “What this means is that not only do women seem to have an effect on making companies more profitable with the resources they have, but also the market values companies with women on boards higher than they value mining companies with all male boards.”
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| According to the report, the return on assets for the top 500 companies increases when more women are on board. |
The report stated, “this means that on average, for every £1 invested in a business, those with all male boards have a loss of 2% on their investment and those with two or more women make a return of 6% on their investment.”
Often, having just one woman on the board did not lead to better results for the company, and sometimes it lead to negative results, van Dyke said. “There is the possibility that just one woman was a token, or that alone she is not able to have the effect on performance.”
However, having two or more did seem to affect performance. Van Dyke speculated as to why this was the case and thought it might be because of a woman’s diverse set of opinions and looking at companies “as a whole rather than on a few metrics.” She added, “They look at risk differently and consider all the ways profitability and risk are handled beyond simply inputs and outputs. They consider perception and how that affects market valuation among other things.”
Priestly also felt women bring something different to the table. “I don’t like to stereotype, but I do find that women are better listeners and communicators,”she said. “In today’s hectic, virtual world, those skills are critical for having high performing teams.”
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Catherine McLeod-Seltzer, director of Kinross Gold |
Catherine McLeod-Seltzer, a director of Kinross Gold, chair and director of Bear Creek Mining, and founder of numerous mining ventures, felt those companies who have more diversity on their boards are probably more progressive and more forward thinking than other companies.
“The more progressive companies are probably the ones at the forefront of the industry,” she said. This in turn could lead to better results.
She added that one of her male colleagues said men act differently when women are on the board and that women tend to ask more questions. When one person initiates questions, this typically leads to others asking questions, she said.
“When board members ask more questions, you get better results,” McLeod-Seltzer said.
For the top 100 mining companies, the average enterprise value to reserves, which shows how much a company is valued at in the market, is 106% higher for companies with two or more female directors compared to all-male boards. That is an increase in enterprise value to reserves of 0.46 from all-male boards to boards with two or more women, the report found.
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Sabine Anderson, member of the Women in Mining |
Sabine Anderson, a member of the advisory board for Women in Mining U.K. and principal consultant of SRK Consulting, with more than 20 years of experience in the industry, said, “A good mix of men and women is beneficial to everyone.”
The report also analyzed the amount of committee participation of women on the top 500 boards. “Of the core committees (remuneration, nomination and audit/risk), committee participation overall by women is 7.6%. On average, across all major board committees, female participation stands at 7.6%. This is just slightly higher than the total percentage of directorships held by women in the top 500 companies, which is 7.2%,” the report said.
The top 100 companies were also analyzed for their contributions to sustainability. They were assessed for environmental, social and governance (ESG) performance. A trend throughout the data was that boards that contain women contribute to better disclosure and transparency and have a positive impact on a company’s environmental and social governance, the report said.
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| The environmental, social and governance (ESG) disclosure scores increase with the presence of women on company boards. |
The ESG disclosure score is measured by Bloomberg and scores companies on the level of disclosure of environmental, social and governance issues. For all-male boards, the score is 25.25, boards with one woman received a score of 31.19, and boards with two or more women had a score of 39.61.
Companies with two or more women on their boards spend five times more on community projects than companies with all-male boards, according to the report. Also, increasing the number of women on the board also increases the likelihood of a company having a corporate social responsibility or sustainability committee. For the top 100 mining companies, there is an increase of more than 30% between all-male boards and boards with two or more women.
Barriers Women Face
One possible barrier and explanation that is heard as to why more women are not in executive management roles or on the board of directors for mining companies is because there is a lack of women with experience in the industry.
“At the corporate level, it is occasionally harder to find women with experience within the industry,” van Dyke said. “Mining is a pretty small industry, and there is a perception that unless you have spent your entire career in mining, you won’t know how to do the job.”
The report took a closer look at the background of the board of directors of the top 100 companies and found that almost 50% of male board members did have prior career experience, compared with a little more than 15% of female directors, which could relate to the small amount of female directors with engineering or geoscience degrees. However, the report did find that male and female directors had a similar average number of degrees at 1.8.
“Mining is very technical and mining engineers, geologists and operators traditionally have been more male than female,” Priestly said. “Women tend to be in more commercial or corporate roles. I am encouraged when I see more women in operational roles, but there still aren’t many.” Priestly herself was a tax partner at Arthur Andersen for the first 24 years of her career, although, that didn’t seem to stop her from becoming a CEO of a top 100 company.
Out of the top 100 companies, there were 10 companies with no engineers, 16 with one engineer, 25 with two engineers, 19 with three engineers, and 30 with more than three engineers.
“There is no reason a top professional from another industry cannot apply business skills and best practices to the mining industry, but the mining industry often seems to believe it has special needs, special requirements, and frankly, that is simply not the case,” van Dyke said. “Yes you need geologists and mining engineers, but other than that, most jobs are not mining specific, and the mining-specific aspects can be learned rather easily if you have the baseline business skills already.”
There is also the fear of hiring the wrong woman just to fill quotas, Anderson said. Companies must be careful in their expectations and offer the proper training, she added.
“For women to positively affect performance, you need qualified women to have a voice, and their voice needs to be heard,” van Dyke said.
Another barrier is changing the way those in the industry view women, specifically those of an older generation or another culture.
“We are fighting 2,000 years of the perception among men and women that mining is a male industry,” van Dyke said. “That takes time to overcome.”
Anderson said she sometimes deals with this perception. “There are times in meetings or in exchanging emails that you realize the person all of a sudden is sensitive to you being a woman,” Anderson said. “They are subconsciously not viewing you as a person, but as a woman.”
She said the person may become more reserved or might be hesitant to speak openly and talk comfortably. When this happens, she speaks and reacts slower, waiting on their reaction.
“I have passed things off to a junior associate because they were a male and the client was more comfortable,” she said. “Or I have asked a question to the man in front of me and his answer goes to the male sitting next to me.”
In these instances, Anderson said one must face it head on, tackle it and then move on.
However, she said these examples are more the exception than the rule, at least for her, and the mining industry is certainly not an isolated industry. This perception doesn’t just apply to men, she said, even women have subconscious stereotypes because of life experiences. Most will assume that the man is the person in charge rather than the woman, she added.
Another possible barrier or obstacle for a woman is motherhood.
“Retaining talent is very important,” Priestly said. “Women have historically been the primary caregiver for children and throughout my career, this has factored in. However, I do see more and more partnering here. But, it is still a challenge.”
Anderson agreed and said companies may steer away from hiring women because of this fact. It will have an impact on companies, she said, especially when taking time off for maternity leave and whether the woman will return towork at all.
“There is a risk and something companies may look at,” she said.
There is also the simple fact that men still make more money than women in the workplace, Anderson said. This is a disadvantage for women because the one who is able to make a better salary is typically the one who works instead of staying home with the children, she added.
“It’s certainly more difficult to be a woman than a man,” Anderson said. “There are certainly some advantages, but let’s not pretend that that even makes it an even playing field.”
How to Overcome Barriers
One of the biggest ways to overcome these barriers is to change the perception, van Dyke said. She hopes this report is a step in that direction.
“The idea that mining is a male industry needs to change,” van Dyke said. “It’s a hearts and minds issue, when mining realizes that mining isn’t just a male industry anymore, and that women can make it a better, more profitable, sustainable and safe industry to work in.”
Groups like Women in Mining are essential in promoting and encouraging women in the industry, Anderson said. It is also important for women to know they are not alone, she added.
“There are women who will be in the industry and feel a little isolated,” Anderson said. “It’s nice to know there are women out there.”
It is also important for the younger women in the industry to have someone with experience who they can turn to for help and support.
“To succeed in any industry, you have to learn as much as you can about all aspects of the business and know whento reach out to others for support,” said Priestly, who tries to mentor younger women.
Anderson also has been a mentor toa few younger women over the years. “It’s important to have a mentor in some capacity,” she said. “We don’t achieve anything alone.” She said this is especially important in the mines and otherareas were women truly are a minorityin the industry.
One of the best ways to promote more women in the industry is to start at the beginning, McLeod-Seltzer said.
“It comes down to having a bigger pool to choose from,” she said. “We need to attract more women at the start of the education process.”
They need to be encouraged early on to pursue careers in the areas of science, technology and engineering, she said.
Although the mining industry may be seen as a male-dominated one, the women who are in it and thriving and thoroughly enjoy what they are doing.
They encourage other women to learn about the industry and inform themselves about the broad range of jobs available to them.
