Study: more women, higher profits

Developing Connections in the Workplace

There’s new research to support what many of us have long believed: In the corporate world, women and profits are closely linked.

In a recent study of nearly 22,000 publicly traded companies across 91 countries, the Peterson Institute for International Economics found correlation between companies with high-ranking female leaders and increased profitability. In fact, the study suggests that when the ratio of women in top management positions rose from 0 to 30 percent, profitability increased by 15 percent, according to Director of Studies Marcus Noland, as cited by the New York Times.

I am not surprised by these findings. Thirty-five percent of the CEOs who are part of my Vistage peer-coaching groups are female. I find that, as leaders, they are ruthlessly focused on creating employee engagement — and employee engagement is tied to strong profits. Indeed, through decades of research, the Gallup Organization has found that profitability increases more than 27 percent in companies with strong employee engagement.

What makes female leaders different? In my experience, they tend to look at issues and opportunities more holistically. They also model a stronger emotional quotient.

Profits aside, we can all learn something from this leadership example. Let’s hope that this study helps bolster a goal that Nolan articulated to the Times: create a pipeline that attracts more females to top management roles.

Category: Leadership

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Avatar About the Author: Stu Heinecke

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