ARTICLE: Want Higher Profits? Hire a Female CEO, CFO
Updated: May 1, 2020
Diversity at the top, it seems, can pay.
Firms with female CEOs and CFOs produce superior stock price performance compared to the market average, and firms with a high gender diversity on their board of directors are more profitable and larger than firms with low gender diversity, according to a study from S&P Global Market Intelligence.
“The evidence is getting louder,” says Beatrice Grech-Cumbo, head of Korn Ferry’s Advancing Women Worldwide initiative. The study builds on prior research indicating that organizations with more inclusive teams, such as women in leadership positions, get better performance from individuals, teams and entire organizations. Those diverse groups are more likely to produce innovative products and deliver them faster to the market than non-diverse groups. Organizations making this change don't just see it as the right thing to do, see it as a source of value creation.
S&P didn’t find anything in their study indicating that the female leaders were doing anything particularly differently from their male counterparts, but speculated that the women who were being appointed to top jobs were the “tip of the spear,” executives whose abilities and traits were far above those of average leaders.
What about barriers to getting more women into the leadership pipeline? Remove them. For instance, giving high-potential talent P&L responsibilities, roles not often given to women or non-white men, is an effective way to broaden skills and prepare them to succeed in even larger roles. Organizations must recognize that just having diverse voices within leadership brings about clear business benefits. Read the full article on kornferry.com.