The document summarizes McKinsey & Company's research on promoting gender diversity in organizations over several years from 2007 to 2012. Some of the key findings include: (1) Companies with more women in top executive positions tend to have better financial performance; (2) Leadership behaviors more commonly seen in female leaders (such as people development) improve organizational health; (3) Getting more women into leadership requires action at societal, governmental, company and individual levels.

1. Women Matter:
Making the Breakthrough
Presentation for Highways Agency/ WTS
18th of September 2012
CONFIDENTIAL AND PROPRIETARY
Any use of this material without specific permission of McKinsey & Company is strictly prohibited

2. Getting more women to the top of organizations is a hot topic
SOURCE: Press search McKinsey & Company | 1

3. McKinsey has been researching the topic of gender diversity for many
years and has by now global coverage
SOURCE: McKinsey McKinsey & Company | 2

4. Our Women Matter reports give fact based answers to the Why? and How?
questions for more women at the top of organizations
2007 2008 2009 2010 2012
Positive link Positive impact Importance of Defining the key Helping
between a of female female elements of an companies to
company’s leadership leadership effective realize the final
performance styles on behaviors in the diversity breakthrough
and proportion of organizational post-crisis strategy
women in its health world
governing body
SOURCE: McKinsey & Company – Women Matter research McKinsey & Company | 3

5. McKinsey & Company | 4

6. In our 1st Women Matter report we found that companies with more than 30%
women at the top of their organisation have better financial performance
Percent, EU companies 2007-09
Average return on equity Average EBIT margin
13.7 +41% 13.9 +53%
9.7 9.1
No women at Top quartile No women at Top quartile
executive level for female executive level for female
representation representation
at executive at executive
level level
Correlation does
not imply causality
SOURCE: McKinsey & Company – Women Matter research McKinsey & Company | 5

7. In our 2nd report we looked at the impact of female leadership on
organizational health
DIRECTION
COORDINATION
ACCOUNTABILITY AND CONTROL
EXTERNAL LEADERSHIP
ORIENTATION INNOVATION
TEAM
CAPABILITIES MOTIVATION
WORK
ENVIRONMENT
AND VALUES
SOURCE: McKinsey & Company – Women Matter research McKinsey & Company | 6

8. We found that leadership behaviours more frequently applied by
women improve organizational health
Leadership behaviors… … improve organizational performance
DIRECTION
People development
Inspiration
Efficient
Expectations and rewards communication
Women
ACCOUNTABILITY COORDINATION
apply more AND CONTROL
Role model Expectations
and slightly and rewards Control and
corrective action
more
Inspiration EXTERNAL LEADERSHIP TEAM
ORIENTATION Role model INNOVATION
Individualistic Intellectual
People
Participative decision making decision making
development
stimulation
CAPABILITIES MOTIVATION
Women and Intellectual stimulation
People Inspiration
men apply development
equally Efficient communication WORK ENVIRONMENT
AND VALUES
People
Individualistic decision making development
Men apply
Participative
more decision making
Control and corrective action
SOURCE: McKinsey & Company – Women Matter research McKinsey & Company | 7

9. Great news… since we know from extensive research that healthy
companies are more profitable companies
Likelihood that OHI quartile has above-median financial performance, %
68
48
EBITDA margin 31 2.2x
62
Growth in 52
enterprise value/ 31 2.0x
book value
53 58
Growth in net 38 1.5x
income/sales
Bottom Mid¹ Top
1 Comprised of 2nd and 3rd quartiles
SOURCE: McKinsey Organisational Health Index data mining effort McKinsey & Company | 8

10. In 2010 we wanted to find out how companies can really make this happen:
Having a balanced diversity eco-system is key
Gender diversity on top of the strategic agenda
CEO commitment
CEO and executive team's explicit support for gender diversity programs
Developing women as leaders …
Networks and
Mentoring
role models
Training and
coaching
… supported by collective enablers
Gender diversity HR processes Infrastructure
indicators and policies
SOURCE: McKinsey & Company – Women Matter research McKinsey & Company | 9

11. McKinsey & Company | 10

12. Despite all attention for diversity, progress made Evolution since 2007
(Percentage points)
in European countries is slow
Executive committees Corporate boards
Country Percentage of total, 2011 Percentage of total, 2011
Sweden 21 8 25 1
Norway 15 3 35 3
United Kingdom 11 8 16 4
Belgium 11 4 11 5
Netherlands 8 3 19 12
France 8 4 20 12
Czech Rep 8 0 10 -2
Italy 6 1 5 2
Germany 3 2 16 5
European average 10 6 17 5
EU announced draft proposal for companies to have 40% of women in their Boards by the end of 2019
SOURCE: McKinsey proprietary database, 2011 McKinsey & Company | 11

13. Getting more women to the top is driven at societal,
governmental, company and individual level
1 2
▪ Tax ▪ Cultural Historical
▪ Legislation (e.g. quota) factors (e.g. war
▪ Infrastructure (e.g. day history, political
Government
care facilities) situation)
▪ Socio – Economic
factors (e.g. labor
intensity, salary levels)
Norms, Values
and Beliefs
3 4
▪ ‘Eco-system’ ▪ Mindsets and
Company Women behaviors
▪ Management
commitment ▪ Perception
▪ Development programs
▪ Collective enablers
SOURCE: McKinsey Women Matter 2012 McKinsey & Company | 12

14. For our Women Matter 2012 report we benchmarked European companies
on the types and effectiveness of their diversity policies
▪ Woman Matter 5 study has benchmarked companies’ diversity policies on a
country level and within their European sector
▪ 235 organizations in 7 European countries participated: France, the UK,
Germany, Belgium, Czech Republic, Italy and the Netherlands
▪ We collected data in 4 different ways
A B C D
Interviews Quantitative On line Online women
data company survey
Qualitative assessment
survey
2. Commitment to gender diversity Quantitative assessment
Qualitative assessment
Your rating
Women metrics
1 2 3 4
3. Women development programs N/A
2007 2008 2009 2010
1 Place on the
st rategic
Not on strategic
agenda
On strategic Qualitative assessment
A top- 10 priority A top-3 priority on
Your rating
agenda but not on s tr ategic strategic agenda
Quantitative assessment
1 Women representation
agenda in top 10 1 3. Women development
agenda 2 3 programs
4 5 N/A Women metrics
Not in plac e Limited Your S ufficient
rating Sufficient scope Com prehensive • Share of women in total headcount (%)
geographical or sc ope; limited and scope; intense Women rep resen tation 2007 2008 2009 2010
2 Management functional 1 committed 2
Not committed to V isibly committed Visibly committed Visibly comm unication; com munication; and effective 3 4 5 N/A – Overall … … … …
commitment gender diversity but no specific with ac tions to limited actionswomen
scope; with inlow to average wom en communication; ient scope Comprehensiv e 5 Co nversio n rate (percentage of a population promoted W/ M W/ M W/ M W/M
Not place Limited Sufficient S uffic – N-3 to CEO in leadership positions year to the next significant level …
… … …
to gender action to foster foster gender
communication; gender
foster participation participation high women during the up)
diversity gender diversity div er sity, low wom en
but no diversity and geographic al or scope; lim ited and sc ope; intense
participation – N-2 to CEO in leadership positionsof women promoted / share of men promoted
… … … …
functional
communication of communication of scope; lim ited
participation
communication c om munication; and effec tive • Share
and low women average wom en c om munication;
4 Tailored results res ults – N-1 to CEO in leadership positions level in leadership positions
– T o N-3 … … … … …/… …/… …/… …/…
mentoring communication; participation participation high wom en
programs w ith low wom en par ticipation – T o N-2 level in leadership positions …/… …/… …/… …/…
partic ipation – CEO … … … …
• Group CE O internal mentors
• Mentoring pr ogram 1 Networking
For men and S pecific to Spec ific to Does not ex ist – T o N-1 level in leadership positions …/… …/… …/… …/…
(further defined – B oard of Directors … … … …
as N level) wom en
events/programs wom en present and
future wom en 6 Gender differences: job satisfactio n (answering ‘satisfied’
dedicated t o
• Group CE O women leaders 2 Recruiting to ‘very satisf ied in internal surveys)
N-1 lev el • Personaliz ed • Internal wom en networ kDoes notists
Exists Ex exist Does not exis t
management identification of needs • Share of women applicants (% of total applicants) … … … …
• Internal wom en networ k Ex ists Does not exis t – Women vs. men overall …/… …/… …/… …/…
team for potential future • Share of of fers to women (% of–total offers) men in a “high-potential program” …
… … …
women leaders specifically for present Women vs. …/… …/… …/… …/…
• Group CE O • Matc h between m entors and future leaders
Inform al Forum s to Formal
N-2 lev el and m entorees • Multi-com pany net- facilitate ists
Ex m entor- assigning of a t
Does not exis • Share of women new hires (% of Women vs. men in senior
– total new hires) management (defined as N-3…
… … … …/… …/… …/… …/…
management working initiativ e for m entoree m entor to each to the CEO or above positions)
– Overall … … … …
team pr esent and future womeneeting
m m entoree
• Mentor for potential 2 Women leadership No
Yes – N-3 to the CEO and aboveGender differences: participation in flexible programs
7 in leadership positions … … … …
3 Clear No genderfutur e women leaders is
Quantitative Quantitative
skill building Quantitative
quantitative diversity targetslev el N-2 or above
CE O targets for targets for
programs
targets for • Share of women who turned down a recruiting and men using flex-time programs: part …
• Share of women offer … … …
targets for • Cr oss-c om pany wom en
for leadership leadership leaders hip
Exists leaderDoes not exist
ship vs. share of men (% of of fers made)reduced work week, maternity leaves, etc.
women positions mentoring positions but no • positions, action positions, action
Personalized Ex ists Does not exis t time,
representation 5 Program to plan
action plan, but no of needs and
identification plan, – Overall …/… …/… …/… …/…
in leadership increase share of for potential futurecompanywide
company wide 3 Gender di fference: salary (average FTE salary for women
positions women in the high- women leaders
communication of communication of divided by t he average for men) – Women vs. men in a “high-potential program” …/… …/… …/… …/…
potential pool • results res ults
Com prehensive tr aining Ex ists Does not exis t – Women vs. men in senior management (defined as N-3 …/… …/… …/… …/…
pr ogram dedicated to • Overall …
to the CEO or above positions) … … …
• Age and tenur e criteria pr Exists and future
esent Does not exist
to enter the high-
women leaders • N-2 and N-3 to the CEO in leadership positions … … … …
potential pool 8 Gender differences: geograp hic mobility
4 Consist ency Company MeasureCompany culture • Company culturof Company culture
• c ulture to neutralize Financing part e
Exists Does Ex ists
not exist Not applicable t
Does not exis
of company creates strong • N-1 t o the CE O in leadership positions … … … …
the impact of maternityely comprises training ac tively fosters
does not activ ex ecutive an and
culture with bias for male e on foster gender
leav the criteria implicit education for
further gender div ersity • Share of women and men in mobility programs (%)
gender leadershipTarget share of women
• div ersity preferencand future
pr Exists e for
esent Does not exist 4 Share of women in high-potential programs (%)
diversity in the high-potential gender diversity – Women vs. men overall …/… …/… …/… …/…
women leaders
objective pool • Share of women in high-potential Women vs. men in “high-potential program”
– pool … … … … …/… …/… …/… …/…
• Quota of women in the 3 Women coaching
Exists Does not exist
high-potential pool sessions with • Share of women in mentoring programs vs. men in senior
– Women management (defined as N-3…
… … … …/… …/… …/… …/…
• Managers responsible external coaches
Exists Does not exist to the CEO or above positions)
for detecting of wom en • Share of women in succession-planning pools for senior … … … …
and m en pool entrants management (for N-3 or above positions) (%)
9 Attrition rates
•
6 Personalized Ex ists Does not exis t
• Inclusion of an HR identification of needs Does not exist
Exists – F or women vs. men in “high-potential program” …/… …/… …/… …/…
contact in final decision for potential future
3
– Women vs. men in senior management (defined as N-3 …/… …/… …/… …/…
on pool entrants women leaders
• Financing for coaching 9 Ex ists Does not exis t to the CEO or above positions)
sessions with an
ex ternal coach
8 4
▪ Our participants received an individual feedback report with its key challenges as
well as a recommendation on the most impactful measures to address these
SOURCE: McKinsey Women Matter 2012 report McKinsey & Company | 13

15. Women are underrepresented at all Odds of advancement for
… men over those for women
hierarchical levels, not only at top management
Number of companies = 1301
CEO 2
5.0x
Seats on executive
9
committee
1.7x
Senior management
14
and vice president
1.8x
Middle management 22
2.1x
Total company 37
1 Companies with more than 10,000 employees and/or revenues greater than €1 billion, and that provided data
SOURCE: McKinsey Women Matter 2012 report McKinsey & Company | 14

16. Each sector has its own challenges
Number of companies = 1301
Media, telecom- Transport,
munications, logistics, Energy and basic
technology Financial services Consumer goods tourism materials
CEO 0 0 7 9 0
Seats on executive
9 9 11 10 11
committee
Senior management
17 13 18 15 15
and vice president
Middle management 20 22 30 19 16
Total company 34 49 50 27 25
1 Companies with more than 10,000 employees and/or revenues greater than €1 billion, and that provided data
SOURCE: McKinsey Women Matter 2012 report McKinsey & Company | 15

17. On the positive side…The number of companies that sees gender diversity
as a top strategic priority has doubled since 2010
Percentage of respondents, number of companies = 235
Among top 3 items
8 12
on strategic agenda
Among top 10 items
20
on strategic agenda
1.9X
41
On the strategic
36
agenda, but not in top 10
33
Not on the
33
strategic agenda
Don’t know 14
3 0
20101 2011
1 The 2010 figures are from the Women Matter 2010 survey. There were 1,560 respondents to this survey
SOURCE: McKinsey Women Matter 2012 report McKinsey & Company | 16

18. But…. Although some companies are making progress with diversity,
most companies still have a long way to go
Number of companies = 1231
Percentage of women at executive committee and senior
management/vice president level
45
Operating Making
with a progress
40
diversity with
advantage diversity
35 N=6 N = 20
5% 16%
30
25 25%
20 20% (top quartile)
15
13% (average)
Limited 10 N = 16 N = 81 Investing in
diversity 13% 66% diversity,
practices 5 but no
impact yet
0
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
Number of measures
1 Companies with more than 10,000 employees and/or revenues greater than €1 billion, and that provided data for women at these 2 levels
SOURCE: McKinsey Women Matter 2012 report McKinsey & Company | 17

19. Why are so few companies successful?
Many measures are not implemented in the most
What’s on paper is effective way in terms of visible actions, frequent
not the same as what communication, participation levels
happens in practice
Commitment at the Focus over the last few years has been on getting
top does not top management involved, but middle
necessarily cascade management has been largely overlooked
to middle
management
Not knowing the exact challenges (the facts) and
not involving ‘the target audience’ themselves has
Lack of focus resulted in ineffective programs. Measures too
scattered, not the right ones…
SOURCE: McKinsey Women Matter 2012 report McKinsey & Company | 18

20. Well implemented
There is a gap between the measures in place and those
Fairly well implemented
that are ‘well implemented’ In place
Percent, number of companies = 235
CEO commitment 41 92
Management Targets for women's representation 24 51
commitment in top positions
Consistency of company culture 22 88
with diversity objectives
15 58
Networking programs/events
Women’s
development Leadership skill building programs 13 47
programs
Mentoring programs/events 16 69
Indicators 18 56
Collective HR processes and policies 25 60
enablers
Infrastructure, e.g., child care 14 43
facilities
1 Measures were rated on a scale of 1 - 5, with the exception of management commitment measures, which were rated on a scale of 1 - 4.
SOURCE: McKinsey Women Matter 2012 report McKinsey & Company | 19

21. While CEO commitment remains high and visible, it does not cascade to
lower management levels
Percent, number of companies = 235
100 100 100
Not in place 8 11
20
In place 22
32
Fairly well 39
29
implemented
32
28
Well implemented 41
25
13
CEOs Senior managers Middle managers
and vice
presidents
SOURCE: McKinsey Women Matter 2012 report McKinsey & Company | 20

22. Men’s and women have differing views on gender diversity issues
Percentage of respondents who “strongly agreed”; number of respondents = 1,7681 Women
Men
64
Do you believe that gender diversity is an 40
important driver of company performance?
Do you believe top management is committed to 27
gender diversity? 13
65
Does the evaluation system in your company 30
treat men and women equally?
1 Web survey participants. Some 35% of the respondents were female
SOURCE: McKinsey Women Matter 2012 report McKinsey & Company | 21

23. McKinsey & Company | 22

24. What do we recommend companies to REALLY make this happen?
1 More visible senior management commitment
2 Target initiatives at your particular challenges
3 Address mindsets
SOURCE: McKinsey Women Matter 2012 report McKinsey & Company | 23

25. We believe that implementing a successful diversity
strategy is similar to a transformational change journey
▪ Track progress
Advance How do you keep
moving forward? Build capacity for
continuous
improvement
How do you
A ct manage
the journey? ▪ Implementation plan
▪ Engage the organization
▪ Committed senior leaders
▪ Balanced diversity ‘eco-
system’ with clear
A What do you need to do to
rchitect address these challenges?
prioritization and focus What are the
▪ Interventions to create ▪ Analyze the numbers
A
specific challenges
lasting change ▪ Evaluate the effectiveness
for your
of existing policies
ssess organization? ▪ Deep understanding of
mindsets
A What are your ambitions
spire in terms of diversity?
▪ Convincing business case
▪ Clear aspiration
▪ Targets at a granular level
SOURCE: Scott Keller and Colin Price, Beyond Performance, 2011 McKinsey & Company | 24

26. McKinsey & Company | 25