Establishing gender balance throughout all levels of an organization is the right thing to do — and it pays.
Gender diversity provides better business results
As businesses compete for market share and increasing profitability, creating great products and services that can be marketed to a broad audience is essential. Embracing gender diversity is a powerful way to help make that happen. A balance of gender on teams introduces a broader range of knowledge, skills, and points of view which results in better products and services. It forces teams to account for situations beyond their personal experiences while creating products and services. This has proven to lead to a significant increase in profits. Studies show that companies with different points of view, market insights, and approaches to problem solving have higher sales, more customers, and larger market share than their less-diverse rivals.
The positive impacts of gender balance don’t stop at the team and product level. Companies with women in at least 30% of the c-suites have significantly better performance than companies with fewer women in the c-suite. Specifically, going from having no women in corporate leadership (the CEO, the board, and other C-suite positions) to a 30% female share is associated with a one-percentage-point increase in net margin — which translates to a 15% increase in profitability for a typical company. Working to increase women in leadership helps improve the bottom line.
Given the positive business impacts of gender balance for businesses, it’s surprising to still see the current imbalances in key industries. In tech company workforces, the industry average is 30% women. However, that number is misleading. Drilling into the technical and leadership roles, it is a less positive picture. Women only hold about 16% of the technical roles at those organizations. This has resulted in products and services that don’t account for women-specific use cases and aren’t as marketable to over half the world’s population.
What’s worse, women account for only 11% of executives at these organizations, and only 9% of executive officers in Silicon Valley are women. Not having women leaders makes it harder to improve female representation. However, there is hope in the inverse. Having more women in leadership helps improve the gender balance throughout the company since when women are better represented in leadership roles, more women are hired across the board.
Companies that are interested in improving gender balance may make strides in boosting the number of women at their organization and begin to see some performance improvements. However, it’s the companies that are committed to establishing gender balance and equality at every level that unlock their organization’s full potential — and they have the profits to prove it.