Tag Archives: superannuation

That’s Not Just Good…It’s Super

25 Tuesday Apr 2017

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We did something extraordinary recently (even if we say so ourselves). It wasn’t easy and it has generated some polarised views. We had to go to ‘court’ for the right to do it and it required a State Commission to pass judgment on it. It went to the basis of what we really mean by equity. We decided to pay our female staff more superannuation than their male counterparts – a further 1% of their salary to be precise.

On the face of it this is discrimination in its own right which is why we required clearance from both the Queensland Civil and Administrative Tribunal (QCAT) and the Anti-Discrimination Commission Queensland.

So why do it? Well I believe it’s the right thing to do. There is an argument by some that the pay differential doesn’t really exist because men and women are generally paid the same for the same job. The broader consideration of this is that women, in general, have considerable time away from the workplace either in the form of maternity and/or carers leave, or returning as part-time or casual workers. Coupled with this, women are over-represented in low paid and part-time/casual work.

The ability therefore for women to accrue sufficient superannuation to secure a comfortable retirement is placed in jeopardy as a result. Compounding the equity impact is the reality that time away from the workplace affects promotion potential. Working outside the system means the grip on networks, the prevailing political landscape and knowledge of potential opportunities is compromised.

We know from research that the informal system is the exoskeleton through which upward progress is made in business. If you are not on the inside you are by default on the outside. The route to seniority or partner is made so much harder, especially when returning from having a baby and having to balance competing demands (skills borne out of necessity, by the way, that are of huge value in the corporate world).

So if you are a believer in gender equity in the workplace and want to do something substantial about it, consider levelling the playing field by paying your female staff more superannuation. They will return this appreciation of their contribution in the workplace in ways that far out-weigh the additional cost.

If you are a small corporation and think this is only possible in the large corporate world think again. We are a small to medium enterprise. We value the contribution of our female team members every bit as much as we do our men. To do so in a meaningful and authentic way is what counts. I can’t think of a more robust endorsement of the importance of equity in the workplace than assisting women to return to work in the most flexible manner possible and making-up in some small way for lost time out of the labour market.

Not all agree of course. When we commenced our differential superannuation contributions this April we became the third company in Australia to do so. It’s an important issue. The Australian Human Rights Commission thinks so and so do we. Wouldn’t it be super if this became standard business practice?

On a Bender Over Gender

17 Friday Feb 2017

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Leadership, I read recently on a meme in Linkedin, is not about being in charge. ‘Leadership is about taking care of those in your charge.’ Schmalzy and jingoistic maybe, but not a bad one-liner to keep front of mind when you become one. As men in leadership we have an extra responsibility and that is to diversity. Lucy Kellaway, one of my favourite but more acerbic writers on management, in a recent article in the AFR, exposed two of the ‘great lies of corporate life: diversity and authenticity.’ I think she was saying that while we all advocate for authenticity and diversity in the workplace the fact of the matter is that in the Corporate world there is a blandness and sameness that is the antithesis of originality and being different. Her thesis is that the nature of the Corporate world is such that we encourage similarity or it manifests itself through the competitive nature of the workplace itself. Outliers, and those who dare to be different, struggle against the mainstream which tends, like all mainstreams, to look very similar.

 

Diversity is, I would argue, a critical requirement in business. Diversity comes in many shapes and forms and includes cultural, racial, demographic, disability, religious, sexual orientation and gender to name but a few. It’s gender I want to concentrate on. It’s my feeling that the three big tensions in the future workplace will be around gender, sexual diversity and education. Workplaces of the future that do not embrace a fairness agenda for its female workforce, or who do not show tolerance to the broad spectrum of expressed sexuality, or engage both the educated and not so educated and treat both with integrity are likely to be long-term losers in the business sustainability stakes.

 

A great article in The Atlantic in July 2015 argued the case strongly that gender equality in the workplace has clear economic advantages. They posit that ‘equality can boost profits and enhance reputation.’ I have taken this to heart and have put in my own equality measures. We have endeavoured to achieve accreditation through Australia’s Workplace Gender Equality Agency (WGEA). Thus far we have been thwarted in this because it doesn’t apply to small companies. Efforts to get a dispensation have been unsuccessful. We keep trying.

 

We have achieved gender balance across both our entire staff and management team. I’ve seen a number of companies achieve this across the staff as a whole but the upper echelons  of management remain stubbornly male-oriented and it is this group, after all, setting employment policies that may well not be advocating for women in the workplace e.g. flexibility, non-detrimental career breaks etc. The third significant push for us has been the differential payment of superannuation.

 

While awaiting a decision by the Queensland Civil and Administrative Tribunal (QCAT) to legally contravene the Anti-Discrimination Act 1991 it is worthwhile explaining the issue. It was put succinctly by one of my Board Directors the other day when he pointed to his own circumstance. His wife had eight children and he admitted that her Superannuation balance (she is of retirement age) is less than $30,000. They say a balance of closer to $1m is what you need for a comfortable retirement. Women are significantly under-superannuated at retirement age. There are a number of factors causing this and pay inequity, while a contributor, is not the primary reason. Women in general have time off for childbirth and child rearing and are often the first port of call as carer for elderly relatives or sick children.

 

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All up they tend to be well behind when they reach the age of 65. Add to this the fact that they live longer (we really must do something about this from an equity perspective) and their low balances are an issue that good employers should think about addressing now. We are proposing our female staff get an additional 1% contribution into their superannuation accounts paid for by their employer. This 1% on the face of it doesn’t sound like much but it has a significant impact come retirement based on the age-old principle (and one that isn’t emphasised enough in schools) – the time value of money (TVM).

 

So as the employer what do I get in return? Well I feel good that I am doing something as a ‘male champion of change’ a title that doesn’t sit that comfortably with me. But it’s more than that; it builds our reputation and brand in the market. It differentiates. It defines us as a leader. It breeds loyalty. It retains talent, it attracts talent. I also think it has an impact at a more cellular level and that is it breeds confidence and a certain expansion in what we think is possible. Not many other companies have done what we are endeavouring so if we achieve it our ‘little team’ can rightly point to this achievement and start thinking about what other previously unscaleable elevations we can conquer.

 

p0321g30                          Lucy Kellaway

 If we are going to be genuine in our efforts to create gender diversity and reap the benefits research shows is associated with this, we have to do more than just have platitudes. We have to lead by example and this may mean leading with our chin. There will be knockers and I’ve encountered quite a few. ‘Don’t forget your lipstick and your handbag’ is one of the funnier comments that came my way. I think that is what Lucy Kellaway was referring to. She would argue that there is too much Guerlain Kisskiss and Prada in our workplaces already! To really redress the balance we have to give it a red hot go with all the enthusiasm of a hen’s night party. In other words going on a bender over gender! That’s what we are doing in a methodical and sober way.

 

Decluttering for a Brand New Super

04 Thursday Feb 2016

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A friend recommended KonMari to me the other day. To be honest I didn’t know what it was so I Googled it. It’s apparently a Japanese life-changing method of de-cluttering and tidying up. I’m a little sceptical given Japan has done little to tidy up issues like the comfort women etc. That said they are tidying up the southern oceans of those pesky rodents of the sea – whales. OK cynicism noted but parked! So I set forth to de-clutter a key part of my life – my home study. There’s a lot of rubbish in there, I admit, but some gems too. I’m not one to have my qualifications on display at work but I do like them up somewhere (all that hard work you see) so I just throw them up more or less at random on the walls of what my partner affectionately calls my ‘shrine’ (to myself I guess she’s suggesting). Feet kept firmly on the ground in our house!

That got me thinking. Back in the day you could just de-clutter, now it is a brand. Brands are everything we are told nowadays and to add to that, a brand must have a narrative – a story. Americans do brands best and you could do worse than read Built to Last by Porras and Collins who reflect on some long-lasting well-known brands that have survived the ravages of time e.g. Ford, Johnson & Johnson and IBM. Protecting brands is important, as is advancing them. For now back to KonMari.

If you are anything like me, the de-cluttering process follows something akin to the business life-cycle. Lots of initial enthusiasm with ‘good stuff’ heroically thrown out at the beginning (the growth spurt), only to plateau a bit (maturity) and at the end (decline) some of the good stuff transfers from the throw out pile to the keep pile. In this clean-up I noticed some superannuation notices for my children. I’ve been meaning to file them away but hadn’t got around to it. Superannuation is like that isn’t it? Don’t really have to deal with it until they reach about 55 years of age. Don’t worry though I’d have filed it by then! They are in Industry Super Funds; three to be precise. Good on them I thought, they will be taken care of. After all it’s the Industry Super Funds that everyone trusts. Talk about strong brands. If you showed anyone that cute (and genius) folded hand above hand sign and they are above 20 I’m guessing they would work out straight away that it’s an industry super fund…priceless. And if you continued your in-the-field market research and asked what it stood for i.e. what the brands says to you, they would likely respond with words like honesty, integrity, reliability etc. Go ahead and try it. I have and that’s the response I got.

We all know the adverts that have changed over the years, but the same folded hand sign has continued throughout. Bernie Fraser the old Governor of the Reserve Bank did it at one stage himself. There is no greater bastion of integrity and reliability than our Reserve Bank Governors, especially when retired. The latest iteration is two men seated side by side and the future value of their superannuation calculated out, presumably inclusive of fees and commissions etc. Not surprisingly the Industry Super Fund is the clear winner here and the Retail Super fund holder is left looking a little forlorn and sheepish…if only he’s opted for the Industry Fund!

A mirror image advert with two women uses exactly the same tactic. It annoys me every time I see it because how does one triangulate with only two reference points? If you want to get some prices to have a deck built at home the best and most often used method is to get three prices. Yes three because then you have a choice between highest, middle and lowest. Two gives you a choice between highest and next highest. The Industry Super Fund adverts do the latter. Just because the Industry Super Fund may be better than the retail fund does not mean there isn’t a third option (maybe a product not offered yet) which has fees at a much lesser rate than the other two. Getting slightly ripped off on the price of something is still being ripped off even if you saw it somewhere else marginally more expensive. You cannot make a value for money call from just two options, we know this from the business world. That is why Government procurement and lots of businesses have the three quote policy as a general rule of thumb.

So with this in mind – mid KonMari – I scrutinised the forms from the three Industry Super Funds. My respective 19 and 23 year olds, I noted, are well scaffolded with death cover, TPD and income protection. Only $3 a week for each fund, but bearing in mind the fact that most young people will not revisit the details of this paperwork (remember these are digital natives) for many years to come they have effectively been given the old ‘value add’ (code for things they don’t need wrapped up as something of great value). Call it for what it is – they are being ripped off. Remember this is the good old honest, reliable Industry Super Fund. I bet you didn’t factor this in when thinking about that brand.

For brands to work well their narrative has to be one built on a true foundation of integrity. Look at VW now to see the risk of not being authentic. Re-read Enron’s Core Values and laugh at the absurdity of that contradiction. This is what I was thinking as I fired a quick text off to both children suggesting they crack on and untick the default box so that their precious earnings don’t get wasted on value adds they don’t need at this time in their lives.

And so I realised that maybe there is something to KonMari after all. Not only do you get some of your home study back but you divest yourself of some long-held but ultimately inaccurate beliefs. Brands entice, brands assure and brands mislead. It’s worth remembering this next time you do a spring clean!