Gender Diversity In Business Plays A Vital Role In Enhancing Competitiveness because having a diverse pool of leaders means that companies have access to different ways of thinking and strategising, which ultimately unlocks new growth opportunities for businesses.
South Africa appears to be reversing gains made in improving gender progression in the workplace, with the percentage of women in leadership roles decreasing from 27% last year to 23% this year.
The research, which was conducted on 200 businesses around the country, also found that 39% of the businesses surveyed actually had no women in senior management positions.
“We’re beginning to lose a very important battle. The gender diversity issue has been on the South African agenda for many years, but we’re clearly not making any headway here,” said Lee-Anne Bac, Director for Advisory Services at Grant Thornton, said.
“The new research reveals that the percentage of women in senior management positions now is down from 27% last year and it’s even dropped below the average of 26% achieved between 2004 and 2015. This does not bode well for the advancement of women at all.”
Several studies over the years have shown the correlation between female leaders and their ability to drive better bottom lines, relative to companies that lack women in leadership positions.
A recent study conducted by EY and The Peterson Institute for International Economics found that among 21 980 listed firms in 91 countries, a 30% female leadership added up to six percentage-points to its net profit, compared to those that have none.
“The impact of having more women in senior leadership on net margin, when one third of companies studied do not, begs the question of what would be the global economic impact if more women rose in the ranks?” asks Stephen R Howe Jr, EY US Chairman and EY Americas Managing Partner.
“The research demonstrates that while increasing the number of women directors and CEOs is important, growing the percentage of female leaders in the C-suite would likely benefit the bottom line even more.”
Bac said gender diversity in business plays a vital role in enhancing competitiveness because having a diverse pool of leaders means that companies have access to different ways of thinking and strategising, which ultimately unlocks new growth opportunities for businesses.
“Within the context of increased uncertainty and complexity, firms need to resist ‘group-think’ and welcome a range of perspectives in order to grow. This is particularly relevant in a rapidly changing global business environment where a wide range of perspectives is critical to navigating new landscapes,” said Bac.
She continued saying that greater attention needed to be paid to redefining how businesses approach leadership in order to grow the number of women in top positions, while greater effort needed to be placed on accommodating the work-life and family balance.
“Our research shows that women are more concerned about the recognition of their ability and earning a higher salary than men, which would seem to reflect the ingrained biases they have faced on their way to the top,” Bac said.
“Firms also need to reassure women that they will be able to make a real difference if they reach the top and, critically, that their efforts will be recognised and appropriately rewarded. The proper mechanisms to ensure that leadership is compatible with family commitments also need to be in place.”