‘Diversity Pays’ — Symposium Addresses Benefits of Women in Leadership

leadership

It pays to have a gender-diverse leadership team at your company, one where women are represented and hold executive and board positions. That was a main message Tuesday at the Gender Equality in the C-Suite and Board Room symposium in Chicago put on by Skytop Strategies.

There is a wealth of research that exists showing the financial benefits of having a gender-diverse executive team at a company. Take, for example, a 2014 study from Credit Suisse that showed companies who have women in senior management positions, including a CEO, outperform companies where gender diversity does not exist. From 2012 to 2014, large companies with a market capitalization over $10 billion and at least one woman on their board, outperformed competitors by 5%, the study stated.

Jim Powers, CEO at Crowe Horwath, doesn’t need to look at studies like these for proof. He sees first hand the benefits of having women in leadership roles at the public accounting and consulting firm. Among the company’s nine executives, three are women. Jim, who spoke at the event Tuesday, said gender diversity is a “true win” for Crowe Horwath’s stakeholders, employees and clients.

“We see it every day,” he said. “Diversity pays … The more diverse the team is, the better.”

Speaking specifically for the accounting industry, Jim said it’s critical to address gender equality. About half of all accounting graduates are women, he said, so being “gender-diverse” and bringing women onboard and allowing them to reach full potential and leadership positions, is key to success.

“Unless we are committed to gender equality, we are doomed to fail,” Jim said.

The ‘Unconscious Bias’ Problem

Jim shared some of the programs and actions Crowe Horwath put into place to create diversity and equality at the firm, including resource groups for women to develop networking and mentoring programs. Tackling company cultural challenges, such as the unconscious bias that exists in many workplaces where people often promote coworkers like themselves, is also being addressed, Jim said. This means men often look to promote men, white people promote other white people and so on.

There was a separate discussion at Tuesday’s event dedicated to overcoming this unconscious bias at companies. Sean Fullerton, CFA, senior research analyst, at State Street’s Center for Applied Research, said his firm has identified a four-step process companies can use to begin tackling this bias problem:

  1. Identify that a bias is taking place
  2. Measure that bias
  3. Introduce a bias interrupter
  4. Remeasure and return to No. 3 if necessary

Sean said the hard part in this process is repeatedly creating and putting into place the “bias interrupter.” How do companies change course? The idea, Sean said, is to assign women to positions where they are able to gain knowledge and get ahead in the company. If a company does not have any women among the senior ranks, the third step in the process is where that firm needs to focus, he said.  

The Investor Perspective

Gender diversity doesn’t just benefit women in the workforce, as demonstrated above and in the many studies conducted on the topic. It impacts the company’s bottom line and attracts investor interest to the firm. A panel of investment professionals addressed this interest in another discussion at the Gender Equality symposium this week.

Kathleen McQuiggan, senior vice president of global women’s strategies at PAX World Investments and managing director of Pax Ellevate Management, said gender diversity plays an important role when her firm is looking where to invest. Kathleen said companies that have women in executive positions and are investing in female talent have better corporate reputations, a higher level of innovation and overall make better long-term investments.

Melissa Waller, chief of staff for the North Carolina Department of State Treasurer, echoed these points during the panel discussion. She said research proves companies with diverse boards that include women have produced stronger financial returns. From an institutional investor perspective, she added, she is interested in companies that are actively addressing and discussing gender diversity issues — it is a key component to the company’s sustainability.

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