Dublin 8 March 2015: Is Gender Diversity Profitable?, a global survey undertaken by EY and The Peterson Institute for International Economics has shown a significant correlation between women in corporate leadership and profitability. The report shows that an organisation with 30% female leaders could add up to 6 percentage points to its net margin.
The report was carried out across almost 22,000 publicly traded companies (52 in Ireland) from 91 countries worldwide. For having the most women-on-boards, the top five countries are Norway (40%), Latvia (25%), Italy (24%), Finland (23%) and Bulgaria (22%). Ireland ranks 28th out of the top 56 countries* for having women on boards (12%). Of the Irish companies surveyed, the results also indicate that 2% had a female chair and 8% had a female CEO.
Speaking on International Women’s Day, Mike McKerr, Managing Partner of EY Ireland commented “Companies that advance women into leadership roles will benefit from more engaged workforces, stronger cultures and improved economic performance. We know that gender-balanced companies achieve better results. As business leaders we need to ask ourselves: Have we made enough progress? Are we helping enough women find their way into leadership roles in order to make our businesses better?”
Gender gap highest at C-suite level
The report found that nearly one third of companies globally have no women in either board or C-suite positions, 60% have no female board members, 50% have no female top executives, and less than 5% have a female CEO. The report found that most countries are still far below the 30% threshold for women CEOs, and only Norway exceeded this standard for women on company boards. The research also showed that while increasing the number of women directors and CEOs is important, growing the percentage of female leaders in the C-suite would likely benefit the bottom line even more.
Sandra Lawler, Director of Alternatives and former EY Entrepreneur Of The YearTM (EOY) finalist said “Ensuring gender balance and diversity at all levels in organisations, is not just the right thing to do, but companies who do so innovate more and are more successful. However, at no level is this more urgent than at the most senior executive levels, where business and talent strategies are driven. People talk about the war for talent, yet often neglect the potential of this 50% of the workforce. Businesses need to provide the support, the culture and focus on diversity for all our sakes.”
With the shortage of talent emerging as a key constraint for business in Ireland in recent months, the need to develop female leaders is of increasing importance. Experienced talent hire was recently cited by the EOY community, who collectively employ over 170,144 people and created over 17,808 new positions last year, as their number one challenge.
The report found that implementing policies relating to viable long term experience for women (specifically substantial maternity and paternity leave policies), access to education and elimination of discrimination were found to be of key importance to addressing gender balance and to advancing women in the workplace.
Mike concluded “At a time when business and government face unprecedented challenges due to technology and disruption, having diverse leadership and management is a necessary and critical tool to survive today. We need our best talent from all areas to bring additional perspectives to complex decision making – now more than ever.”