Is Gender Diversity Profitable?
Companies where at least 30% of the key management positions are held by women tend to be more profitable than their less diverse peers, according to a new report published in advance of International Women's Day tomorrow. "Is Gender Diversity Profitable" is a global survey covering 22,000 stock-market listed companies, including 52 in Ireland, undertaken by consultants EY and the Peterson Institute for International Economics. It suggests firms hitting or exceeding that 30% target can add up to 6 percentage points to their net profit margin.
Niamh O'Beirne, a Director with EY in People and Organisational Change, says the survey makes a direct link
between profitability and the number of women in leadership positions in an organisation. The survey says that if a company gets to a position where there is 30% or more women in leadership roles, a rise of 15% in profitability can also be seen. Ms O'Beirne says this is quite a significant impact on any company's bottom line.
Ireland comes 28th in the survey, which shows that the country has 12% of board positions filled by women, while just under 12% of leadership positions are filled by women. She says the country has some way to go to achieve that key 30% rate. Ms O'Beirne says we hear quite a lot about quotas and gender diversity on board positions but she says this survey also looks at women in actual leadership positions. The survey says that to improve overall performance, it is the women in the leadership positions in the organisation that have a significant role to play in that rather than at board level. She says a company's leadership team should focus on building a pipeline within the organisation and supporting women at all levels of their career and not getting one woman to the top.