Does diversity really breed better business performance? According to new research from Frank Recruitment Group, yes, especially for firms with women CEOs at the helm.
The global IT staffing company found that 87% of 2021’s Fortune 500 companies with women CEOs reported above-average profits. In contrast, this statistic dropped to 78% for companies without one, showing the value of women in leadership positions not just for the diversity of thought and perspectives but for growing profits and performance.
These findings give further credence to the 2020 McKinsey study, which found that diversity on executive teams leads to better financial performance over time.
However, adequate representation of women in CEO positions remains lacking. Just look at the Fortune 500 list, an annual list of the 500 largest corporations in the US, where women CEOs lead only 39 out of all 500 featured.
To create more women CEOs and encourage more into other C-suite positions, Zoë Morris, President of Frank Recruitment Group, says a culture shift is needed, led by existing leadership. Her three main steps are outlined below.
1. Increase the visibility of women
It may seem obvious, but to build an inclusive team, you have to actually build an inclusive team. When a woman is looking at your leadership team, is she seeing any other women? If not, this could be the thing that stops a female employee from moving up into a senior position, with your business missing out on the value she has to offer as a result.
It may be that women do already have leadership roles within your company, and the issue is down to their visibility. Giving employees credit for their work is crucial, as any manager will know. However, making their achievements known within the company can sometimes get overlooked. Try letting their department know when they’ve excelled in their role – whether this is via a group email or a special mention in a meeting.
2. Offer suitable career progression opportunities
Think about what opportunities you are offering your female employees. Are you giving them a chance for career progression? Is the opportunity one they will be interested in or able to take?
These are simple questions, but actively putting more thought into the answers can make a massive difference. Try mapping out their career journey, including what your employee’s short-term and long-term goals are, as well as any personal circumstances that could affect these. This way, you are seamlessly incorporating a focus on these questions into your routine. Once you begin doing this, you will see natural – and almost effortless – change.
3. Promote equality within the workplace
Just as people will notice if you aren’t promoting equality within your company, they will notice if you are. If the language used within your workplace communicates sexist stereotypes, regardless of whether this is unintentional, it could discourage female employees from believing they have a fair shot at a C-suite level position.
Likewise, if the language conveys the opposite, they will be encouraged that gender doesn’t play a factor in the hiring process. This doesn’t just apply to speech used within general office conversations either. Consider what messages both the textual and visual communications you send out are giving. Even ask other staff members their thoughts on the content. This way, you receive direct feedback and know if you are going wrong somewhere.
In this article, you learned that:
- Firms led by women CEOs are more profitable than others, with 87% of 2021’s Fortune 500 companies with women CEOs having reported above-average profits.
- In the Fortune 500 list, women CEOs lead only 39 out of all 500 featured.
- Leaders must offer suitable career progression opportunities to encourage more women into C-Suite positions, such as mapping out their short/long-term goals.