Did you know only 14 percent of executive officer positions at the Fortune 500 companies are held by women? It has remained at that level for the past six years. The board of directors seats don’t fare much better at only 16 percent.
“In fact, the percentage of women (on a board of directors) was one of the strongest correlations with better performance. Better performing companies have a higher proportion of female board directors …” — The Eversheds Board Report, The Eversheds International Law Firm, LLC, March 2011
Comparing these business leadership statistics to the U.S. labor force sparks concern, especially since women make up nearly 50 percent of the labor force and comprise 51.5 percent of management and professional positions. Switch to the consumer side … women account for 85 percent of all consumer purchases. The issue is in part about equality, but it’s more about workforce diversity. How can you effectively take into account concerns of half the workforce and two-thirds of the consumer buying power without diversifying leadership? A recent article in the New York Daily News shared the story of seven female CEOs and the lessons we can learn from them. Here are three BIG advantages to promoting women to leadership.
Women Elevate the Bottom Line
A study conducted by the U.S. Department of State Advisory Committee on International Economic Policy, of executive committees, including in Europe and the fast-tracked BRIC countries (Brazil, Russia, India, China), identified the top companies in terms of their share of women on executive committees. The study then compared the financial performance of this top group with all-male executive committees and concluded:
Companies with the highest share of women on their executive committees have better financial performance than companies with no women.
Diversity Lowers Risk
A board of directors and executive leaders have the responsibility for oversight of the performance of a company’s business operations and they need to understand the changing dynamics the company faces. Diversity in leadership makes it easier to identify and understand risks and develop robust solutions to address them. Diversity should not sacrifice competence. It should be supported with a review of competence, commitment, and character of potential leaders.
A Focus on Social Intuition
In today’s socially driven era, companies are more focused on building relationships than ever before. This includes better relationships with their employees. Women have the capability of focusing on the day-to-day operations while also recognizing changes in the social environment. It’s not to say men don’t have this capability, it’s that women are more drawn to it, making identifying issues easier.
Led my Margaret Jacoby, SPHR, MJ Management Solutions delivers tailored human resource consulting services to small business clients since 1999. If you need help creating a recruitment plan, immediate help is available through her HR Department On Call® program. The program gives you the peace of mind that an expert is always ready to respond to your evolving HR needs and challenges.
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