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Gender diversity in management improves firms’ performance

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THE International Labor Organization (ILO) said one of its studies has found that greater gender diversity in management positions is likely to improve company performance in metrics like productivity and job retention, adding that many organizations estimate that gender diversity drove profit growth of 5-20%.

In a report, “Women in Business and Management: The business case for change,” the ILO said: “A gender-inclusive culture requires a critical mass of women in management, senior leadership and on boards of directors, of at least 30%.”

A study of 13,000 companies surveyed worldwide showed that over 60% of organizations that achieved such diversity saw improved labor productivity.

In involving more women in management positions and prioritizing equality in employment, 54% of companies said they saw more innovation in their operations while 57% said women in managerial positions also helped attract and retain workers.

ILO reported that 74% of respondents attribute to gender diversity in management profit growth of 5% to 20%.

“(T)hese results make gender diversity part of a larger dynamic of innovative and sustainable business practices, which also contribute to improved outcomes. These are companies focused on the future and how best to thrive in a changing global business environment,” ILO said.




Despite the advantages of gender diversity for businesses, the ILO said women remain a minority in top management and CEO ranks.

“There are a couple of prime contributors to this shortfall. One is the ‘leaky pipeline,’ in which the representation of women decreases as the level of management increases, resulting in continued male dominance of the chief executive level and boards,” the report said. ILO said that as enterprise size expands, the amount of women in the C-Level jobs also drops.

In the Philippines, ILO estimates that women make up only 25.8% of top management and CEOs in 2015. Some 29.6% worked for small enterprises; 33.9% for medium-sized firms; and 14.0% for large-scale companies. ILO said companies need to address the “leaky pipeline” that takes women out of contention for top jobs, adding that they need to invest in strategies that promote gender diversity in order to keep afloat in the global economy.

“Gender-inclusive policies and their enforcement are important for achieving gender balance at all levels. Almost 75% of the enterprises surveyed have equal opportunity or diversity and inclusion policies, but more specific actions are needed so that women gain the experiences that prepare them to be promoted to strategic areas of business,” ILO said. — Gillian M. Cortez

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