Slaying dragons: the demeaning quota system

Time-limited or not, mandated quotas are one of the most blunt, crass, and ineffective instruments available to tackle issues of gender imbalance. They rob women of any sense of achievement they might otherwise feel from being rewarded a pay rise or a promotion.

Some claim that quotas are a pathway to a genuine meritocracy, which give women the opportunity to break through the glass ceiling, where their talents can finally be observed. But this justification is fundamentally anti-meritocratic, and – while I’m sure unintended – extremely demeaning.

The assumption is that women need more support than men to get into top positions. If there were evidence to suggest that women faced overt discrimination in the workplace – as there was 60 years ago – this argument might hold up. But the data we have today, particularly around the gender pay gap, tell a very different story. Women in part-time work are out-earning men, while women aged 22-39 in full time work have a negligible gender pay gap.

The lack of women in senior roles is largely a result of time taken out of the workplace to raise children (more on this later). Even the Office for National Statistics, which calculates the official pay gap data in the UK, notes that its findings do not include like-for-like comparisons, and provide no evidence of breaches in equality legislation.

You can skirt around the issue all you like, but quota systems are intrinsically designed to prioritise gender first and qualifications second. The merits and achievements of Jane are only considered after the pool of applicants has been purged of enough Joes to satisfy whatever percentage of roles the law mandates women fill.

It’s not simply the demeaning nature of quotas that should concern us, but also the unintended consequences of their implementation.

Mandated quotas have the catastrophic effect of taking legitimacy and respect away from women in positions of power, while simultaneously giving credibility to rogue Men’s Rights groups, which often (and wrongly) complain that women have an easier time of it, both in the workplace and in society overall. Any tensions that currently exist between women and men at work will only be exacerbated by a quota policy, and sympathies are likely to end up with the wrong group.

And what about the evidence from abroad? Despite all the baggage that comes with quotas, have they proven successful in giving women a deserved step up?

Look at Norway: in 2003, legislation was brought in requiring all public limited companies to implement a 40 per cent quota for women on their boards, to be achieved within five years’ time. On the face of it, small groups of women benefited. Those already in high-paying, senior roles were given further promotions, but there was “no discernible beneficial effect on women at lower levels of the corporate hierarchy.” As often happens in the modern-day gender debate (think BBC pay furore), the salaries of elite women became the focus, while the status of the majority of the working female population went largely unchanged.

But there have been other problems with Norway’s quota legislation. Between 2008 and 2013, 195 public companies became private and nearly 1,000 board member seats were culled altogether (denying opportunities for men and women to progress).

And for the firms that tried to meet the target, the quick increase in female board reps (9% in 2003 to a mandated 40% by 2008), led companies to promote “many women who were less experienced than the directors they had before.”

In 2011, The Economist reported a study from the University of Michigan, which “found that firms that were forced to increase the share of women on their boards by more than ten percentage points saw one measure of corporate value…fall by 18%”.

Does all this suggest that female presence on boards leads to worse outcomes? Of course not. Indeed, there is plenty of evidence which shows companies that promote and involve women to a greater degree see “higher return on equity (and) fatter operating profits” than companies that don’t diversity their staff.

What the evidence from Norway does highlight is that quotas aren’t the best way to achieve such diversity. As Spectator editor and Telegraph columnist Fraser Nelson pointed out a few weeks ago, there is plenty that could be done tomorrow to help more women progress through the ranks at work, like making “more childcare tax-deductible and, in general, take a little less away from working mothers trying to make ends meet”. Campaigns around voluntary shared parental leave could also do the trick.

But quotas are the least sensible way to go. They undermine women; they undermine business; and they leave no one better off, except the campaigners, who can pat themselves on the back for a job poorly done.

As we continue to make bold strides – to shed labels, reject stereotypes, and create inclusive communities – we must also slay the notion that a policy promoting radically different treatment in the workplace for different genders could ever be dubbed “progressive”.

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