The chief financial officers’ panel at February’s Real Capital conference in Toronto was most notable not for the topics discussed, but for the diverse composition of the panel.
There was a man of East Indian heritage, a Chinese woman and three other women on stage — something unimaginable at a real estate conference in years gone by. Was this a one-off fluke, or is it a sign the industry is changing with the times and becoming more diverse and inclusive?
“There are a growing number of people of different backgrounds now in senior roles, and there’s a lot more discussion of diversity and inclusiveness,” one of those panelists, RioCan Real Estate Investment Trust senior vice-president and CFO Qi Tang, told RENX in a follow-up interview.
At the age of 22, Tang immigrated to Canada from China. She rose steadily through the ranks at five different organizations before assuming her current role at RioCan two years ago.
Research conducted by the McKinsey Global Institute (MGI) in 2015 ranked Canada in the top 10 of 95 countries in women’s equality. However, the report also said the country’s progress had stalled during the past 20 years and gender gaps could take another 30 to 180 years to close. The gap was particularly significant in managerial positions, where women accounted for just 35 per cent of the total.
An MGI survey of 69 Canadian companies, representing more than 500,000 employees, showed women comprised about 45 per cent of all entry-level employees, but only 25 per cent of VPs and 15 per cent of chief executive officers.
KingSett Capital chief operating officer and CFO Anna Kennedy was another member of the Real Capital panel. She’s also the past president of Toronto CREW (Commercial Real Estate Women), which is part of the CREW Network and dedicated to empowering women to excel, influence and lead throughout their commercial real estate careers.
The network was created in 1989 and now has almost 12,000 members in more than 75 markets worldwide, including Calgary, Edmonton, Saskatoon, Vancouver and Montreal. In response to questions for this article Kennedy, Cadillac Fairview‘s senior director of legal services Alison Tortorice (Toronto CREW’s president), and Grant Thornton LLP principal of assurance real estate practice Farrah Khimji (the president-elect), teamed up to provide written answers.
“Membership in Toronto CREW expands our members’ professional networks and encourages them to develop leadership skills through committee and board work, and by developing rich programming to allow our members to learn and develop, while expanding their knowledge of the commercial real estate industry,” they said.
“At Toronto CREW, we are encouraged by the fact that we have experienced a consistent increase in our membership year-over-year and we don’t see this growth slowing down.
“The diversity of our membership is also changing with respect to the disciplines that our members practise within the commercial real estate industry, ranging from finance, law, investment, brokerage, property and asset management, development and architecture, to name a few, and we continue to attract more and more women from all disciplines of the business.”
Toronto CREW offers outreach to female Grade 11 students to educate them about careers in real estate, and scholarships to young women taking post-secondary real estate courses.
Research on women in leadership roles
A 2017 CREW Network white paper titled Diversity: The Business Advantage showed women in commercial real estate were 54 per cent less likely than men to have an individual who can provide career advice and actively help advance a career path. So, Toronto CREW also offers mentorship programs pairing women with fewer than five years in the industry with more senior executives.
A 2016 CREW Network white paper titled Closing the Gap: Addressing Gender Bias and Other Barriers for Women in Commercial Real Estate showed women represented 37 per cent of the commercial real estate workforce in Canada.
“It is important for the commercial real estate industry to focus on continuing to create an environment that is diverse and inclusive, one that is representative of the Canadian population,” wrote the Toronto CREW leadership group. “Real estate is important in our society, as it affects the way in which we live, work, play, create and innovate, and as such it is important to have leadership and decision-makers that are representative of our diverse society.”
An Osler, Hoskin & Harcourt LLP report titled 2018 Diversity Disclosure Practices: Women in leadership roles at TSX-listed companies showed that, as of July 31, 2018, women held 16.4 per cent of board seats among all companies disclosing the number of female directors on their boards. That number rose to 28.4 per cent for S&P/TSX 60 companies.
More than two-thirds of all companies have at least one female director and one-third have two or more, according to the report. However, just 3.3 per cent of companies had a female chief executive officer while 3.5 per cent had a female board chair.
With 3.38 per cent female CEOs (up from 3.09 per cent in 2017), the real estate industry ranked second to utilities and pipelines in the industries broken down in the report. Real estate ranked first among the sectors with 26 per cent of executives being women, up from 24 per cent in 2017.
REALPAC diversity and inclusion efforts
“We have a pipeline that’s changing,” said Real Property Association of Canada (REALPAC) chief executive officer Michael Brooks. “At the young end, I think it’s already quite diverse. At the senior end, it’s very white and male.”
REALPAC and FPL Advisory Group have begun gathering data for annual briefings and scorecards for the Canadian commercial real estate industry to benchmark diversity and inclusion efforts.
Brooks said REALPAC is implementing a four-level diversity and inclusion plan which covers:
* what the association is doing internally;
* what it can get its board of directors to do as a group;
* what it can get its member companies to do as a group;
* and how it can change the perspective of the entire industry.
REALPAC changed its bylaws in 2018 so its nominating committee can include board member candidates from the CFO and COO levels – no longer just CEOs – which should help increase diversity. It increased its board size to 10 members, and there are now three female directors, including its first female vice-chair (Infrastructure Ontario real estate president Toni Rossi), who will be chair in two years.
“As our industry matures, we want to continue to get the best and the brightest, and we want younger people to look to the real estate industry to have a career,” said Rossi. “The best and the brightest come in all shapes, sizes and colours, and male and female, so having that diversity at the table in the future will be a big difference.
“The good news is that the pipeline is starting to change, notwithstanding the top, which is still very much white male-oriented.”
Diversity statistics and leaders
CREW Network is seeking commitments from real estate companies to achieve gender equality on their boards by 2022.
The 30% Club Canadian Investor Group, comprised of 16 large Canadian asset management firms, issued a statement of intent in September 2017 targeting a minimum of 30 per cent women on boards and at the executive management level of S&P/TSX composite index companies by 2022.
The real estate industry averaged 1.33 female directors in 2018, up from 1.16 a year earlier, according to the Osler report. That equates to 17 per cent and 16 per cent, respectively.
Dream Unlimited Corp. and Sienna Senior Living Inc. were highlighted in the Osler report because at least half of their board members were women in 2016 and 2017. Dream remained on the list for 2018, while Sienna dropped off and MCAN Mortgage Corporation was added.
Dream Global REIT (100 per cent), Sienna and Killam Apartment REIT (55 per cent) had at least 50 per cent female representation in executive officer positions in 2018, according to the Osler report. Dream Hard Asset Alternatives Trust, Dream Office REIT, First Capital Realty Inc., Mainstreet Equity Corp., Melcor REIT, Partners REIT and Timbercreek Financial Corp each had 50 per cent.
The role of unconscious bias
CREW Network’s 2016 industry research survey revealed 65 per cent of respondents have personally experienced or observed instances of gender bias against women in the commercial real estate workplace in the last five years.
Women are often perceived by others to be less qualified for high-level positions. Studies have found men are often hired or promoted based on potential, while women are prized for their experience and track records.
While there may be cases of overt discrimination, women can also suffer from unconscious bias — which occurs when people’s brains rapidly categorize others instinctively by the most obvious and visible categories, including gender. Research has shown this bias pervades the workplace and highest levels of leadership.
“People tend to prefer their own people,” said Brooks, who believes name-blind resumes, which don’t provide a clue about a job applicant’s racial heritage or gender, can help combat unconscious bias and increase diversity.
END OF PART I