Women business leaders boost profits, says UN

28 May 19

Businesses perform by up to 20% better when they employ more women in top positions, United Nations labour experts have claimed.

A major report makes a strong business case for more women in leadership, with six in 10 companies saying gender diversity improves business and citing gains in creativity, innovation and reputation. 

However, the International Labour Organisation – the UN’s labour agency –  notes that despite this most firms still pay only lip-service to the idea of gender equality in the boardroom. 

The report, Women in Business and Management: The business case for change, covers 13,000 firms in 70 countries.

It says that globally about 60% of firms agreed that gender diversity improved their business through gains in creativity, innovation and reputation. 

Almost three-quarters of companies that tracked gender diversity in management positions reported increases in profit of between 5% and 20%, while the majority saw 10% to 15% growth. 

Firms with more women in management tend to be more profitable, find it easier to attract talent, and have a better public image.

Moreover, according to report author Jae-Hee Chang, having more women in the boardroom also led to more female managers at the entry, medium and senior levels. 

“We expected to see a positive correlation between gender diversity and business success, but these results are eye-opening,” said Deborah France-Massin, Director of the ILO Bureau for Employers’ Activities.

“When you consider the efforts companies make in other areas to get just an extra two or three per cent in profits, the significance is clear – companies should look at gender balance as a bottom line issue, not just a human resource issue.” 

The UN report also found a correlation between more female employees and increased production, based on data from 186 countries from 1991–2017.  

However, fewer than a third of company boards globally have at least 30% female participation – the “critical mass” where the positive effects on the bottom line of more women in senior management begin to kick in.

France-Massin added: “It’s clear there are still fewer women in those type of [senior] roles than in the workforce as a whole, and the higher you go in the chain of command in a company… the less likely you are to find a woman.”

  • Gavin O'Toole, expert on Latin America
    Gavin O'Toole

    A freelance journalist. He has written six books about Latin America and taught the politics of the region at Queen Mary, University of London.

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