The way entities approach corporate structure can often determine their fate and longevity in today’s volatile markets. Several hot-button topics exist today in the forefront of corporate leadership best practice, and one key area of discussion is the concept of gender diversity.
While still treated only as a PR exercise or publicity opportunity by some companies, gender-diverse leadership creates systemic benefits for corporations. This is well-supported in both academic research and business case studies.
Time and time again, corporations that prioritize gender-diverse leadership teams outperform their more gender-monotone counterparts. Increasing gender diversity within corporate leadership doesn’t just provide an opportunity for media attention – it provides sustained, tangible benefits to the organization as a whole.
Current Stats on Gender Diversity in Company Leadership
At the highest levels of corporate leadership, we are only beginning to see meaningful gender diversity of any sort. Examples of this include positions in the executive suite at for-profit corporations, and especially at large companies like those on the Fortune 500 list. Even though the list has been published annually since 1955 and includes the top 500 companies in the U.S. based on revenue per fiscal year, the first time a Fortune 500 company hired a female CEO was not until 1972.
2020’s Fortune 500 list included 38 companies with female CEOs, weighing in at just 7% of the total CEO count. Though this reveals a significant increase in female corporate directorship since 1972, female CEOs are still drastically outweighed by male counterparts in the same position. Other forms of gender diversity representation are even more sparse.
Gender diversity is just as important throughout the entirety of the corporate executive suite. In 2019, the percentage of C-Suite positions held by women, surveyed across the USA’s 1,000 largest corporations, reached 25% (an increase on previous years). For advocates interested in seeing the number of female leaders in the corporate space increase, this is an encouraging development.
In other areas of the corporate landscape that are traditionally male-dominated, upticks in female participation and leadership can also be observed. For instance, large-scale efforts are being made by a wide spread of entity types, from tech corporations to higher education institutions, to encourage females to consider careers in STEM (science, technology, engineering, and math) fields.
From running children’s events to offering undergraduate scholarship programs, many stakeholders in the industry are investing time and effort into making the space more gender-diverse and decreasing barriers for women who would be interested in pursuing STEM careers. Other industries might not be making such a concerted push, but awareness is growing that gender diversity is beneficial to every avenue and area of business and resulting shifts in practice are beginning to show.
Hurdles to Increasing Gender Diversity in Corporate Spaces
Despite movements towards stronger equity between and among genders, increasing gender diversity is still an uphill climb in today’s corporate world. There are a few important reasons for this.
International Differences or Expectations Can Complicate Gender Equity and Diversity in Leadership
Especially for corporations that do business internationally, business dealings across international and cultural lines can sometimes be complicated by female or gender-diverse individuals that may be regarded differently in other cultural contexts.
Since many cultures around the world still wouldn’t have room for females or gender-diverse individuals in positions of leadership in business contexts, a female leader from a more gender-diverse company may experience resistance, mistrust, or a lack of respect from male partners, vendors, or customers located in other cultural contexts.
The Candidate Pool of Gender-Diverse Individuals is Currently Small
As demand increases and more corporations look to hire gender-diverse individuals for their leadership structures, they sometimes find that appropriate candidates are incredibly difficult to find. It takes time to develop a robust candidate pool for elite positions.
Because women and gender-diverse individuals are only beginning to gain access to C-Suite positions en masse, the average candidate has not had the opportunity to amass decades of experience. The journey toward developing a candidate pool with ample experience happens at a glacial pace. Even though significant effort is being put towards accelerating this process, it will evolve slowly.
A Significant Lack of Organizational Buy-in Can Still Exist in Many Corporations
Increasing the number of gender-diverse individuals that hold positions of leadership within an organization requires that other leaders, as well as their subordinates, accept and respect their authority. When authority isn’t well handed off or an organization’s culture isn’t ready for greater diversity in leadership, these transitions can be difficult, ineffective, and ultimately harmful to both the individuals and to the entity as a whole.
Why Gender Diversity in Leadership is So Valuable
With all these difficulties in the mix, why even bother cutting against the grain to increase gender diversity in corporate leadership? As alluded to above, increasing gender diversity in leadership offers a significant number of advantages and positive outcomes.
A wide set of studies have indicated various advantages for corporations with more highly diverse leadership teams. These include superior management performance, higher-yield decision making, better ROI, better productivity and profitability, higher-quality problem-solving, and better relatability to consumers. These advantages and more make it worthwhile to prioritize increasing gender diversity in corporate leadership.
Photo Credit
Image by Gerd Altmann from Pixabay
Guest Author Bio
Sarah Daren
With a Bachelor’s in Health Science along with an MBA, Sarah Daren has a wealth of knowledge within both the health and business sectors. Her expertise in scaling and identifying ways tech can improve the lives of others has led Sarah to be a consultant for a number of startup businesses, most prominently in the wellness industry, wearable technology and health education. She implements her health knowledge into every aspect of her life with a focus on making America a healthier and safer place for future generations to come.
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