1.0 Executive summary
Workforce diversity has been identified as one of the strategic capabilities that will add value to the organisations over their competition. This assignment focuses on how gender diversity has an effect on the business strategy and how to increase female participation in the workplace, especially in a management role. This assignment will be divided into two parts where the first part focuses on trends in Malaysias labor force participation, with a discussion of general theories predicting the presence and the magnitude of labour market discrimination.
Followed by, discussing the barriers that women face in seeking employment, both from the concept of transition into formal employment and from the concept of adverse conditions within the formal market that disadvantages female employees in higher management. Part two will be providing a full understanding of how legislative response to diversity and equality, and the organisation and HRM response to diversity and equality in Malaysia. Lastly, recommendations on how women can be a positive impact on top management and improve Malaysia’s rate of gender diversity to a higher level.
Human resource practices and diversity have become an important issue in organisations due to rapid economic growth and advancement. Human resource development has become one of the most important tools to emerge to further equalize diversity, equity, and reform in the workplace. However, workforce diversity has been identified as one of the strategic capabilities that will add value to the organisations over their competition. Managing diversity is usually viewed in broad conceptual terms as recognizing and valuing differences among people; it is directed towards achieving organisational outcomes and reflects management practices adopted to improve the effectiveness of people management in organisations.
(Joseph, D.R. & Selvaraj, P.C. 2015) In the present world of business is much more different than it was 50 years ago. Improvement in work and family roles of women has made its contribution to the business improvement of the 21st century. Females are now getting employment in male-dominated professions such as Legal Advocacy firms, sports, army , and top-level corporate management. It is observed that due to gender diversity at workplace organisations have increased their productivity and output. Women feel that problem such as difficulties in their career growth toward upward promotions still exists in organisations. Though there are many female employees entered in organisations at middle-level positions but still not able to advance to top management positions.
The success of a business requires that organisations should utilize their talent irrespectively of both genders. If organisations want to use their employees’ talent best, difficulties in vertical growth of female should be improved. Many difficulties are seen as biased against females in their offices when there is a concern of upward growth, pay or wages, and career progression opportunity to the next level of positions. This is the reason that firms are not fully utilizing a major portion of their talent pool, which shows the loss of millions of dollars annually as a result. Discrimination is becoming widespread in the workplace and is harmful to an organisation. Any modern business goals should always consist of abolishing all kinds of discrimination around their work environment and create a positive environment that supports diversity. (Bibi, N. 2016)
3.0 Literature Review
The success of any organisation is being influenced by the effort of its employees because they are an asset to the company. Previous research reviews the theoretical model of gender discrimination and employee productivity that includes discrimination gender in promotion, gender segregation in hiring and gender discrimination why providing goods and amenities. The study refers that if there are allocations for female representation in the organisation, it was like figurehead were less or more defenseless. That is why in the international showground, there is a rising complaint that women should be allowed in taking part in essential decision making and adapting equality of women in an organisation. (Patrick, F. 1998) clarifies that if gender discrimination remains in the system, it will have effects on employees who are in the labour market. The variance is continuous that it affected working hours of women since is being controlled, the result shows evidence of wages discrimination against women according to industries of work and human capital characteristics. Besides that, these differences may also be labeled by a different culture, legal, social and economic environments in which the firms are operating.
Studies on the impact of gender diversity in Asian regions and in developing countries are relatively limited because of the discrimination about incorporating woman directors in higher management. (Johl, S.K, Kaur, S. & Coorper, B. J, 2015) have studied the impact of board characteristics and firm performance of 700 public listed firms in Malaysia for the year 2009. They found that women’s participation is positively related to the return on assets. This is consistent with the work of (Taghizadeh, S. & Saremi, S.Y 2013); The studies investigate 150 public listed firms in Malaysia using data of the year 2008. Which also reflect similar result found by (Fan, P.S, 2012) for the firms listed on the main board of Singapore Exchange. This related to the value measured by (Tobin’s Q, Marimuthu & Kolandaisamy, 2009) found no relationship between gender diversity and firm performance for 300 listed firms on Bursa Malaysia.
3.1 Relation Between Organisation and Gender Diversity
Over some decades, gender diversity has garnered much attention among business leaders and organisation. According to a recent report by (McKinsey Global Institute, 2015) suggests that having womens labour force participation equal to that of mens worldwide could increase the overall global economic output by 26%, compared with current employment patterns. (Wood, 1987) showed that a mixed gender group performed better than the same gender group. (Gupta, 2013) observed that moderate level of gender diversity increases competitive advantage while a higher level of gender diversity decreases organisational performance.
The future of the economic boost returns and addressed the concern about the baby boomers, as well as low fertility rates, have led government leaders in some Asian countries to offer organisation incentives aimed at improving womens labor force participation. For example, the administration of South Koreas President Park Geun-Hye has created initiatives to encourage womens continued employment following childbirth. While womens overall labor force participation rate in South Korea is around 55%, the rate for younger women which age between 25-29 is nearly 73%, compared with just under 56% for women aged 35-39 (OECD, 2015). A central concern for the Korean government is how to create policies that keep women in the labor force and set them on track for managerial positions. In 2013, women comprised only 10% of managerial positions in central government, motivating the countries administrators to set a target of 15% by 2017. (Lee,2015)
3.2 Impact of Discrimination for Gender Diversity in the Workplace
According to (Eagly,1987), gender role theory indicates that an individual’s gender determines his/her behavior and its effectiveness with respect to influence. Gender role theory describes how men and women have certain behavior with respect to communication, including influence tactics. For example, women are expected to play more feminine roles such as sympathy and gentility as they tend to be more flexible that could lead to greater ability to manage the unclear situation. (Rosener, 1995) However, men are expected to be more assertive and aggressive which leads to particularly vital for male-dominated realms such as the board of directors where esteem is critical to effectiveness. (Tan,S.S & AuYong H.N, 2017)
As per the Department of (Statistics Malaysia and KRI, 2017) calculations shows that when the women do get employed, they tend to be engaged in occupation different from men. Almost half of the employed women are service and sales workers (29.2%) and professionals (19.8%), followed by clerical support workers (18.0%). Managers, on the other hand, make up only 3.1% of the total employed women, which is the smallest proportion of all. However, men are more equally distributed across all occupations, with clerical support workers making up the smallest share of employed men, at only 4.5% (Figure 3.2)
3.2.2 Wage Gap
As per figure 3.2.1 shows a means of data collected through a field survey conducted in 2007/2008 for the whole Peninsular Malaysia through the questionnaire. As per result, the mean wage for male workers is higher than the female workers. As about 18% of the samples are Chinese and 78% live in the developed region. The percentage of males who attended training is higher than in females. This is shown that the females have long years of schooling than the males but males have long working experience. About 36% of the working households are from science and technology stream education and the majority of them attain their education from local institutions. The majority of them are full-time workers and about 76% work in the service sector. For example, the median monthly salaries wages for male and female increased by 7.3% (RM1,721) and 5.2% (RM1,685) respectively compared to the previous year. (Rahmah, I & Idris, J, 2012)
As per conclusion shows that women in Malaysia are in less advantage than the men in Malaysia. No matter it is through the discrimination based on their perception as women being none assertive and takes a longer time to achieve a managerial role in the company, women also receive lesser wage compared to men.
3.3 Law Enforcement for Gender Equality
Based on the UN Convention on the Elimination of All Forms of Discrimination Against Women (Cedaw) Committee has also advised the government to provide a concrete timeline for the adoption of Gender Equality Act pursuant to its 2018 review of Malaysia. The current issue where the legal protections against sexual harassment are limited to the employment context and only apply to Peninsular Malaysia. This legal framework in Malaysia currently affords little protection for victims of stalking, which can happen in isolation in addition to being an extension of domestic violence or sexual harassment. (thestar.com.my, 2018)
As per conclusion, the law enforcement on full protection of human rights for women in Malaysia is yet being significantly practice and still undermined by the government. However, on the Malaysian Trade Union Congress (MTUC) has also made suggestion to reform the employment rights whereby raising minimum salary from RM2,000 a month range to RM10,000 workers to be covered under the Employment Act 195, maternity leave to be raised from 60 days to 98 days, and paternity leave of 7 days. This is to encourage Malaysia’s aim to achieve a high income nation not only needs quality workers but also quality employers as the workers’ wellbeing and dignity are important for increased productivity. (thestar.com.my, 2019) An organisation could endorse their own rules and regulations to uplift and let women have a fair share of their work performances through the organisation’s human resource management.
Organisations could use the Lewin-Schein Change Model to find ways to implement the strength of the workers diversities. As (McGuire and Bagher, 2010) point out, increase the participation of diverse groups in the workplace requires human resource development to commit and promote workplace diversity. Change is not an easy task for the employee where (Brisson-Banks, 2009) stated that organisations need to resolve and commit to make the change and do what is necessary regardless of any inconveniences involved in the process.
This theory needs to work in conjunction with the organisation policies and vision provided by the organisations top management. The theory itself can be adjusted to meet their purpose where it can be utilized as a platform for an organisation to gather the best plan for the development of the diversity policy. This will balance the strategic, financial, and business goals of organisations with the interests of the employees who are doing the work. (Salleh, K.M. & Sulaiman N. L, 2012)
Organisations should first seek to establish a diagnosis of the situation and identify gaps and bottlenecks. Indicators may include the proportion of women in the companys various units, at each level of management and among recruits. They may also include pay levels and gaps, as well as attrition rates, between men and women in similar functions.
Besides that, organisations should look into redefining human resource management processes and policies where they need to ensure that their recruitment, appraisal and career management systems are gender-neutral and performance-focused and that they do not hold women back in their professional development. For example, 43.2% of Nestl? manager positions are held by women while 31.8% of Nestl? senior leadership roles are held by women. Their goal is being a gender-balanced company by creating the enabling conditions in their work environment to achieve annual increases in the percentage of women managers and senior leaders. (www.nestle.com, 2018)
Next, is that organisations that have successful gender equality are through top management who provide full support and initiation whereby the effort has clearly amounted to nothing less than a cultural revolution. Therefore, such change programs should take the form of full-fledged company transformation initiatives, with top management seen to be in control. Positive practices will not catch on unless top management is convinced that diversity creates a competitive advantage and is committed to changing the company culture. (McKinsey, 2008)
Lastly, (Hopkins, O’Neil, and Bilimoria, 2006) found that increasing knowledge, skills, and education through access to training courses was one of the most frequently cited strategies for building leadership skills. Leadership training programs could have had encouraging results for women. For example, Malaysia The 30% Club started as a campaign in the UK in 2010 with the goal of achieving a minimum of 30% women on FTSE-100 boards. The Club is then launching in 2015 by Prime Minister and attended by Chairmen, CEO, and business leaders who are committed to bringing more women onto Malaysian corporate boards. This club is to inspire debate and discussion at corporate leadership and board levels on gender diversity and its benefits to business, assist corporate boards in their engagement of qualified, board-ready women and support initiatives to build a pipeline of women in executive and non-executive role. (30percentclub.org, 2015)
Dramatic changes in the nature of work, the evolution of technology, and unique labor market forces are creating many challenges for HRM decision makers today. This paper reveals that gender diversity still having a huge gap in Malaysia. But to apply the change model from other organisation to implement it is a very difficult task. A lot of factors should be considered, such as an external environment and the cultural differences as a barrier. By examining how the recommendation could benefit the women, top management should apply this to the next phase of the organisation strategic plan. They should see gender diversity as one of the important elements of 21st-century skills that will change the organisation.