The proportion of women in the workforce has dramatically increased over the last 100 years.
Social attitudes towards female employment radically changed across the globe after women in the United States won the right to vote in 1920. By the early 1990s, 74% of women aged 25-54 were participating in the labor force. More women were stepping out of traditional “feminine” jobs such as clerical work and teaching to become doctors, lawyers, and managers—professions historically dominated by men.
But recent data shows that positive trends in the number of women in the labor force peaked, slowed, and eventually stopped by the 2000s. Major strides have been made towards closing the gender gap, but the playing field remains uneven for women in the workplace today.
Men in the labor force still outnumber and outrank women. Plenty of data shows that women earn less than their male counterparts, experience more harassment and microaggressions at work, and are less likely to reach the highest levels of their careers. Women in leadership positions are also grossly underrepresented in the corporate world. In fact, women occupied less than a third of managerial positions worldwide in 2019 and made up just 10.9% of senior executives in Fortune 500 companies.
Female employees also contend with unique career challenges that most men effortlessly avoid, like childbirth and childcare. These are often overlooked in the greater scope of diversity and inclusiveness efforts, as well.
Today, because of these setbacks, women are quitting their jobs in numbers previously unseen. Yet the data shows that employing more women in leadership roles has never been a better idea. And there are some key reasons why.
Women enhance profitability.
Of course, more women in management positions addresses the issue of gender equality—a cornerstone of diversity, equity, and inclusion (DEI). But there are monetary incentives, too. Research shows that closing the gender gap could make the world economy richer by 26%.
Additionally, having female C-Suite executives significantly boosts profitability, as revealed in a 2016 survey of 21,980 companies across 91 countries conducted by the Petersen Institute for International Economics. In fact, there’s strong evidence that higher female representation leads to higher business performance.
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Women excel in leadership.
Scientifically speaking, brains tend to be wired differently according to sex. Men and women often bring different perspectives, skills, and strengths to the workplace. Generally speaking, men tend to be action-oriented, focusing on one task at a time, while women are often more intuitive and better multitaskers.
Women are wired to be empathetic and emotionally intelligent—helpful qualities in leadership. These values, typically thought to be more “feminine,” hold a competitive edge in today’s economic environment. They also disrupt the way companies have traditionally been managed.
Female leadership also fosters higher engagement, inclusivity, and trust. Research on matriarchal societies shows that maternal values and mutual respect characterize female leadership. Patriarchies tend to focus on “power over others,” but matriarchs champion the mantra “power from within.”
The numbers support this, too. According to the Harvard Business Review, women working in managerial positions were found to have scored higher than men in twelve of sixteen key leadership qualities–including collaboration, resilience, taking initiative, and thinking outside the box.
Other studies show that female leaders are perceived by employees more positively than their male counterparts. Female managers were reported by their employees to provide better emotional and psychological support. Additionally, Fortune’s “most admired” companies have more women in senior management than other firms.
Women business leaders minimize risks and improves performance.
Sustainable development in business is here to stay. The rise of B Corporations and the increasing demand for DEI policies and environmental, social, and governance (ESG) transparency represent a shift in business decisions that are less driven by profit and more focused on guaranteeing inclusivity and prosperity.
Research suggests that women in management roles minimize corporate risks and improve corporate social responsibility and ESG outcomes for their companies. Female officials are also less likely to be corrupt than men and that voluntary disclosure about climate emissions increases among firms with higher female board representation.
Studies also show that more female senior executives invest more time beyond their jobs to improve DEI than their male counterparts.
Women drive change and innovation.
Innovation—the ability to create potentially disruptive products and services—is necessary to survive today’s complex business landscape. Evolving technologies are outpacing traditional business models with increasing rapidity, forcing players across industries to keep up or close shop.
There is growing evidence that gender equality improves innovation outcomes for companies, with an emphasis on the positive impact of female representation. Research shows that companies with female directors achieve greater success in terms of innovation, while a study of Fortune 500 companies revealed that gender-diverse teams with women in top management produce 20% more patents on average than teams led by men.
Women were also found to score as highly as or better than men in competencies related to innovation and the ability to champion change.
The advantages of being a woman in the office are clear.
One of the seventeen sustainable development goals (SDGs) to be reached by 2030 is gender equality and female empowerment. The United Nations identified this as a critical component to economic expansion and social development.
Challenges caused by the COVID-19 pandemic, however, have stalled progress globally. Gender-responsive budgeting to fund women’s health services is lacking. Female leadership in decision-making roles has fallen behind.
Equal pay and benefits, treatment, and representation on leadership teams are hallmarks of gender equality in the workplace. But women face a “broken rung” on the corporate ladder. Only 87 women are promoted for every 100 men promoted across the board, from entry level to managerial positions—and women are still leaving their jobs more than men.
Companies can sustainably progress toward gender equality by getting more women into leadership roles and tapping into the female leaders they already have. Companies with higher female representation are taking action to identify and fix their broken rung while offering training, flexibility, and personalized employee benefits such as emergency childcare and mental health support.
Despite the many benefits of female leadership in business, few companies are taking advantage. But for those paying close attention to the data, focusing on innovation through female leadership empowerment is sure yield positive returns on investment.