Gender diversity in business could be a key selling point for organisations looking to attract and retain the top talent in their industries, say researchers.
Yet recent research by tax and assurance company Grant Thornton has revealed a steady decline globally in gender diverse business leadership and South Africa is one of the poorest performers.
In SA, women hold less than a quarter of leadership positions – and nearly 40 percent of firms have no women in management.
This could spell trouble for the country’s competitiveness, says Liz de Wet, a leadership development practitioner who runs the Women in Leadership programme at the UCT Graduate School of Business.
“Globally, research has revealed that a more diverse workforce is linked to a company’s financial performance,” she says.
In fact, according to the Grant Thornton report, companies with diverse boards among the largest listed companies in the UK, US and India are outperforming their male-only peers to the tune of $655 billion annually.
Studies by Gallup, Harvard and McKinsey have also shown that having a gender diverse executive and workforce is a major advantage in business because it brings different viewpoints, market insights and ideas into the boardroom and enables better problem solving.
Businesses are under increasing pressure to broaden their talent pools in an increasingly competitive market and smart companies are realising that gender diversity holds the key, says De Wet.
“There’s a reason why more and more corporates, along with the global organisation of UN Women, are supporting gender diversity in business and politics.
“It’s because, apart from being the right thing to do, it’s also increasingly becoming the only way to thrive,” she says.
Gender diversity simply makes bottom-line business sense, writes Sangeeta Bharadwaj Badal, prime researcher for Gallup’s Entrepreneurship and Job Creation Initiative.
Similarly, a Harvard study found that teams with an equal gender mix performed better than male-dominated teams in terms of sales and profits.
And, if the profit motive is not enough, De Wet says the incentive to diversify is also coming from the workforce itself.
“A diverse workforce provides wider industry knowledge and allows companies to serve an increasingly diverse customer base,” she says.
De Wet believes this means that organisations which genuinely respect diversity and make this obvious in their ethos are more likely to build and retain a stronger, more talented workforce.
“Companies cannot afford to ignore 50 percent of the potential workforce and expect to be competitive in the global economy.”