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With An Eye On The Future, We Can't Afford To Leave Anyone Behind

05/11/2015 5:47 AM AEDT | Updated 15/07/2016 12:50 PM AEST
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ATARI co-founder Nolan Bushnell once said -- "The ultimate inspiration is the deadline."

It would have been hard to imagine what deadline the 1970s game console inventor had in mind back then, but no one is questioning his motives now.

As business leaders and innovators, we need to be keenly aware of the 'deadlines' of the future. I believe we are about to enter the greatest period of wealth creation and prosperity the world has even seen. The opportunities for our economy are tremendous.

With an eye on the future, we can't afford to leave anyone behind.

In July this year ANZ published a report called Barriers to Achieving Financial Gender Equity, which looked at the financial life-cycle of Australians and identified the hurdles we face as a nation in embracing the full economic contribution of women in our society.

It revealed three opportunities to improve the financial security of women, for the benefit of our economy and of future generations.

First, bring into balance paid and unpaid working responsibilities.

Research shows that men spend more time in the paid workforce than women, while women spend more time in unpaid work, typically raising children or taking on other family responsibilities.

Both contribute to the economy, but only one is rewarded financially. So decisions around whether a parent should return to work following parental leave, for instance, are based in part on how the cost of childcare compares to the income of one partner.

The decision to return to work should not be based on whether you or your partner earns more money. But the reality that many men still earn more, and this -- combined with social pressures and the desire to have at least one parent at home raising children -- helps explain why the female workforce participation rate is only 59 percent, compared to 71 percent for men.

Encouraging flexible work practices and looking at childcare subsidies in the context of workforce participation, not welfare, will support a better, more diverse contribution from both men and women at home and at work.

Second, close the gender pay gap.

It makes no sense to encourage more women into the workforce if they are not going to realise their full earning potential once they get there.

Today, women in Australia earn, on average, 82 cents in the dollar compared to men -- a trend which has barely shifted in the last 20 years. Extended over an average career, this amounts to around $700,000, or the cost of a home in most Australian capital cities.

The problem is exacerbated for women who take career breaks to have children. When they return to work they are often hit with wage penalties and barriers to career progression they never recover from.

Removing the barriers to pay equality is complex, but not impossible. It starts with employers who are committed to providing equal opportunities for staff and addressing unconscious bias in their merit processes, including recruitment and promotion practices.

It ends with the measurement and transparent reporting of gender pay gaps. As the saying goes, if you can measure it, you can manage it. If we are going to get serious about paying people equally for equal work then we need to track our progress and be accountable for it.

Third, make our superannuation system work better for women and families.

One of the drawbacks of our current superannuation system is that it doesn't cater for differences in our earning potential over the course of our lives. This is a huge disadvantage for women -- and the growing numbers of men -- who work part-time or take career breaks.

In many instances, women do not make superannuation contributions while they are on maternity leave. This is one of the many reasons they retire with almost half the superannuation savings of men.

There is an opportunity, as the Government considers its options for superannuation reform, to make the system more equitable and make better economic sense for families.

For example, we should allow couples to have a single superannuation account. Joint accounts provide more flexibility and allow for better management of contributions caps if one partner interrupts their career. They would also allow couples to save on fees. Second, employers should pay superannuation guarantee contributions to employees who take parental leave.

Take a 30 year-old employee on full-time average earnings of $75,000 per year. If her employer paid superannuation contributions for two years, she would receive an additional $14,250 into her super account upon her return to the workforce. The $14,250 invested over 35 years, at an average 6.0 percent return, rises to $100,000 in retirement.

While these two measures are no silver bullet to achieving financial gender equity, they will help make our superannuation system more relevant for families, and will improve the financial security of women, in particular.

It is within our reach to create a future in which men and women have equal opportunities to contribute, and to succeed. We will reap the benefits in the form of stronger economy, a community of fairness and opportunity, and a deadline met.

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