December 19, 2023

Social Aspect of ESG: Promoting Gender Diversity and Inclusion in the Workplace

The social aspect of ESG (Environmental, Social, and Governance) is crucial in assessing the ethical and sustainable practices of organizations. In the last issue, we explored the broad range of social issues and performance metrics used by various companies in the Philippines related to topics such as Labor Relations, Human Rights and Diversity, Equality, Inclusion and Belongingness (DEIB).

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This article will focus on DEIB, particularly gender diversity and inclusion (D&I) and what companies are doing in this area to reap the benefits of a dynamic, diverse, and inclusive workplace.

Gender Diversity, traversing between the concepts of diversity and equity, is the fair representation of people of different genders – usually quantified in terms of the ratio of men to women.

However, a company may be diverse in terms of demographics of workforce, and yet not inclusive. Therefore, Diversity and Inclusion (D&I) are often taken together – both related but distinct in definition from one another.

Inclusion is the active and genuine involvement of people regardless of age, gender, ethnicity, or background. It recognizes the value of each person’s uniqueness and provides ample space and acceptance to the extent where one feels valued, encouraged to participate and be their authentic selves. This sets the stage for cultivating belongingness in teams and the whole organization, in general.

Advocating for gender diversity and inclusion serves a dual purpose: it not only mitigates compliance risks with established standards and regulations but also empowers the organization to capitalize on opportunities to achieve positive outcomes.

Diversity and Inclusion (D&I) Regulations and Indicators

In 2018, ISO 30414 (Guidelines for Disclosure of Information on Human Capital) was released as a guide for companies in their sustainability reporting / disclosure initiatives. The factor on Diversity looks at how the organization enriches the composition of its workforce with respect to age, gender, ethnicity, qualification, and mix of profiles in leadership levels.

It is interesting to note that the Philippines tops other ASEAN countries in the ratio of women in business leadership roles with 33% vs. ASEAN average of 25%. In fact, while the Philippines may be below the global average for Human Development Index (HDI measures overall long and healthy life, access to knowledge and decent standard of living), it ranks higher than global average for Gender Development Index (GDI), which is based on life expectancy, access to education, and command over economic resources of males versus females (UNDP, 2021).

Moreover, the Philippines is ranked #8 in the world and categorized as Group 1, where 1 is the closest to gender parity while 5 the farthest (Gender Development Index, 2019). What this means is that leveraging on gender diversity and inclusion may be a low hanging fruit for organizations in the Philippines.

Publicly listed companies in the Philippines are also required by the SEC to provide their Sustainability Report alongside their Annual Financial Report (SEC Form 17-A). Ratio of male to female in the workforce as well as in female representation in leadership positions are required to be reported on a regular basis.

Below are examples of reports on gender diversity and inclusion as reported by the respective organizations through their Annual Sustainability Report –

COMPANY	GENDER REPRESENTATION
COMPANY	Scope	Male	Female
Aboitiz	Overall	57%	43%
Aboitiz	Leadership	49%	51%
Ayala	Overall	57%	43%
Ayala	Leadership	76%	25%
Meralco	Overall	77%	23%
Meralco	Leadership	72%	28%
San Miguel Corporation	Overall	73%	27%
San Miguel Corporation	Leadership	59%	41%

Sources: Aboitiz Integrated Report (2022), Ayala Investor Relations Integrated Report (2022), Meralco Combined Annual and Sustainability Report (2022), and San Miguel Corporation Sustainability Report (2022)

While the figures seem to be promising, it’s crucial to understand that merely having a diverse workforce or equal representation at executive levels is simply not enough. To reap said benefits for the organization, it is essential to cultivate an environment where individuals feel enabled, valued, safe to share their ideas and viewpoints, and empowered to reach their full potential.

Initiatives Promoting Gender Diversity and Inclusion

Looking into the United Nations (UN) 17 Sustainability Development Goals (SDG), SDG No. 5: Gender Equality aims to achieve equality and empower women. Some of the target initiatives applicable to the workplace setting are (The Global Goals, 2023):

End discrimination against women and girls
Ensure full participation in leadership and decision-making
Equal rights to economic resources, property ownership and financial services
Promote empowerment of women through Technology
Adopt and strengthen policies and enforceable legislation for Gender Equality

Companies, especially, the publicly listed ones, have demonstrated their commitment to drive SDGs through ESG efforts. This is done through regular monitoring as well as introducing programs in their respective organizations to help drive key sustainability targets. Below are examples of major companies in the Philippines who have shared their key initiatives and efforts in driving Gender Diversity and Inclusion in the workplace:

Aboitiz Equity Ventures Inc. based on the Aboitiz Integrated Report (2022) –

Awareness Building – info sessions and feature stories for Women’s Month, Pride Month, etc.
Policy Development – Anti-sexual Harassment Policy, Safe Space Act, Board Diversity Policy, Anti-discrimination Policy, which extends to suppliers and business partners

Ayala Corporation based on their Investor Relations Integrated Report (2022) –

Equal Opportunities on Hiring and Promotion – performance-based promotion criteria (achievements / merit and skills and competencies)
Equal Access to learning and career development where average training hours are of same value between males (48.4 hours) and females (48.9 hours)

Manila Electric Company (Meralco) based on their Combined Annual and Sustainability Report (2022) –

Diversity and Inclusion Policy (“#Mbrace” Program) – various initiatives such as training and scholarship to build pipeline of female electrical technicians. The objective is to increase women representation in a male-dominated industry to at least 40% by 2030 (from 23% in 2023, which in itself is already double the global energy sector average)
Grant or Financial support (“MPowHER” Program) for aspiring women electrical technicians and electrical engineers in partnership with universities in Canlubang, Nueva Ecija and Los Banos.

There are a multitude of benefits in advocating for gender diversity and inclusion such as its correlation with the following positive organizational outcomes:

Enhanced performance and innovation – different perspectives and ways of thinking lead to better problem-solving and more effective decision-making
Improved corporate culture and organization resilience – well-prepared for evolving standards and guidelines around Diversity and Inclusion
Higher level of employee engagement and psychological safety – cultivating a positive and supportive work environment by embracing the each one’s unique contribution drives motivation and retention

Research shows that diverse teams / workforce, composed of people from various backgrounds and experiences, make better decisions, innovate, and solve problems more effectively. Companies that embrace diversity and inclusion are better in adapting to changing demographics and societal expectations, ensuring their relevance and sustainability, and are better positioned for long-term success.

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NRI Manila supports companies in the area of Sustainability and ESG through our sustainability consulting services. We support companies in developing their sustainability strategies in terms of corporate culture, structure, assessment, and reporting to achieve a more sustainable future.

About the Contributor

Diane is the Head of the HR Sector at Nomura Research Institute Singapore Pte. Ltd. Manila branch. She has over a decade of experience in Human Resources and Organization Development helping organizations in their organizational transformation journeys. She is also a recipient of the prestigious Australia Awards Scholarship, where she earned her master’s degree in Human Resource Management and Industrial Relations from The University of Sydney.

REFERENCES:

2022 integrated report. Ayala Land Investor Relations. (2023, May 31). https://ir.ayalaland.com.ph/2022-integrated-report/

2022 Meralco combined Annual and Sustainability Report. Meralco. (n.d.). https://company.meralco.com.ph/node/10257

Aboitiz Equity Ventures Inc. (2023, June 14). Aboitiz 2022 Annual Integrated Report. https://sustainability.aboitiz.com/report/

Boden, S. (2020, November 17). Start here: A primer on diversity and inclusion (part 1 of 2). Harvard Business Review (HBR). https://www.harvardbusiness.org/start-here-a-primer-on-diversity-and-inclusion-part-1-of-2/

Equality, diversity and inclusion in the workplace: Factsheets. CIPD. (2022, November 1). https://www.cipd.org/uk/knowledge/factsheets/diversity-factsheet/#Whatis

Goal 5: Gender equality. The Global Goals. (2023, April 18). https://www.globalgoals.org/goals/5-gender-equality/

San Miguel Corporation. (n.d.). https://www.sanmiguel.com.ph/annual-reports

Sustainability Reporting Guidelines for – SEC. Securities and Exchange Commission. (2019, February 15). https://www.sec.gov.ph/wp-content/uploads/2019/10/2019MCNo04.pdf

United Nations Development Programme. (2021, March 2). Gender diversity and inclusion for a Fair Business Environment: United Nations Development Programme. Gender Diversity and Inclusion for a Fair Business Environment. https://www.undp.org/publications/gender-diversity-and-inclusion-fair-business-environment

Wikimedia Foundation. (2023, June 17). Gender development index. Wikipedia. https://en.wikipedia.org/wiki/Gender_Development_Index