EXCLUSIVE: Gender Imbalance In Senior Real Estate Leadership Roles Is Getting Worse

The proportion of women in senior leadership roles in UK real estate has worsened in the past six years, a comprehensive new industry survey revealed, with a blockage at middle management level a key cause of the problem.

A survey undertaken every two years by industry body Real Estate Balance found that women made up 27% of the workers in senior leadership positions at the end of 2022, down from 32% in 2016. A total of 32 companies employing 53,000 staff provided data for the survey.

On the plus side, the proportion of female employees in senior roles rose from 21% in 2020. Other positive findings included a big fall in the proportion of support staff who are female, indicating women aren’t being confined to lower paid work in real estate, and a rise in female board representation from 19% to 29%. Real Estate Balance cautioned, however, the rise in board representation might have been achieved by just hiring more nonexecutive directors to boards. 

The survey also directly canvassed the opinion of 756 employees and found a disconnect between what senior leaders thought was important to improving diversity, and what staff thought, particularly female staff, nonwhite staff and staff from lower social backgrounds.

In other findings, a significant proportion of staff at real estate firms don’t feel able to talk to their line managers about their career and life aspirations; in the past two years, men have found it significantly more difficult to talk about those aspirations. 

“Obviously the lack of improvement at senior leadership level is disappointing,” Real Estate Balance Managing Director Sue Brown said. “I don’t think anyone thought this issue was going to be solved overnight, and just because there hasn’t been a huge improvement doesn’t mean we stop doing what we’re doing.”

The survey found more companies are now gathering data on diversity within their organisations, tracking their progress and reporting on that progression. Brown said this was a big step toward making improvements. 

The survey does not yet ask companies to report on the ethnic or socioeconomic balance of their company because staff are not obliged to provide this data. But it did ask the employees surveyed to provide information on these factors to gain insight on how people from different backgrounds felt companies were doing when it comes to improving diversity.

The data highlighted the crunch point for the industry when it comes to improving gender diversity. The survey found 43% of staff in entry level roles and 44% in middle management are female, but that figure drops to 27% when it comes to senior leadership.

Getting people from the middle to the top is the problem. 

“What you often see is that when people are in middle management, they are not ready to step up to senior management, and so companies have to recruit from outside,” CBRE Global Head of Loan Services and Real Estate Balance board member Clarence Dixon said. “We have to put more focus on middle management, training, mentoring to make sure people can reach that senior level.”

Asked whether the drop might be related to bias among the people making hiring decisions at the senior level, Dixon said: “I’m not going to say that’s not true, but I think it’s more about retention than hiring, and making sure resources and training is directed towards people in middle management to make sure they’re ready to make the step up.”

Dixon pointed out that real estate companies start from a very low base and must run hard to reach gender parity and improve diversity: If a company is aiming to reach 50/50 gender parity, for instance, 10% of female staff leaving means it has to hire 10% female staff to replace them and another 10% to improve the overall balance. 

Real Estate Balance has 10 CEO Commitments that it encourages the senior leaders of its 120 members to incorporate into their businesses to improve the diversity of their organisations.

The latest survey found companies are doing well in meeting those commitments, including gathering, tracking and reporting on diversity data, outlining the business case for diversity, personally engaging with diverse members of the workforce, and promoting D&I while working on the topic in small groups. 

But it also discovered businesses thought they had done less well than in 2020 when it came to insisting on diversity for recruitment or promotion and changing mindsets when it came to bias and discrimination.

There is a reticence among companies to set hard targets when it comes to diversity, Dixon said.

“People want to set targets, but they don’t want quotas,” he said. "Overall, you find the majority of organisations have ambitions, but they don’t want to set them in stone.”

Dixon added that gathering more data on the issue is a first step toward improving the situation. 

On the question of changing mindsets, the survey found there was a disconnect between what management thought was important when it came to improving diversity and what staff felt.

Respondents to the company survey thought that having a diversity action plan was the most successful strategy for improving diversity. Staff, on the other hand, said priority should be given to cultural or behavioural change, something companies ranked in the bottom half of successful strategies. 

The survey found, perhaps unsurprisingly, that nonwhite, female or staff from less privileged backgrounds were less satisfied with the diversity of their organisations and what is being done to improve it than their white, male, more privileged counterparts. 

In addition, the survey indicated 19% of male employees and 16% of female employees felt unable to talk to their line managers about their career and life aspirations. For female staff, that is about the same as in 2020; for men, that is about double the 2020 figure, a significant deterioration. 

“During the pandemic, a lot of men spent more time at home and perhaps now have a different attitude to work/life balance,” Dixon said. “There’s a perception that women might always take time out to have a family, and men see that as more important now. But they can’t be seen to come out and say that.”