25 December 2020

More Women At The Top Means More Profits For Businesses — And A Stronger Economy For Everyone


In the world of business, being the warm-up act on the boardroom stage often means rousing the audience from their slumber.

Just like a performer insisting on more enthusiasm from the crowd, it's time for businesses to demand more from their leadership diversity.

A recent study revealed a staggering reality: the UK is losing out on an extra £47 billion in pre-tax profit due to the lack of gender diversity in boardrooms. The evidence speaks volumes—companies with over 33 percent female executives boast a net profit margin over 10 times greater than their counterparts lacking women in leadership roles. It's a cause for celebration: more women at the top equate to more profits.

While skeptics may argue that this correlation is simply a result of more profitable sectors promoting more women, the pattern persists across all industries, regardless of profit margins. Successful companies, it seems, grasp customer needs, exhibit better risk management, and display higher collective intelligence when women are part of the decision-making process.

Research conducted by esteemed institutions such as Harvard, MIT, McKinsey, and others consistently points to higher team performance when women are involved. The notion that women only support other women is debunked by the fact that female bosses, on average, maintain a healthier ratio of women on their executive committees compared to their male counterparts.

While gender is a crucial metric of diversity, it is not the only one. With women constituting 51 percent of the population, increasing female representation becomes a pivotal step towards fostering diversity in various aspects, from race to disability.

For many years, The Pipeline has been at the forefront of measuring diversity, consistently finding that without women at the top, a company is underperforming. The message to all businesses is clear: the evidence is irrefutable, and a template for positive change exists. Harness the talents of women with enthusiasm, and watch your profits soar while creating a more inclusive workplace that draws on the talents of all. It's time for businesses to take center stage in transforming leadership and reaping the rewards of diversity.

Lorna Fitzsimons
Author Lorna Fitzsimons | Pipeline Co-Founder

Lorna Fitzsimons is a serial entrepreneur and accomplished businesswoman. She is an acknowledged expert in the D&I space and co-founder of The Pipeline. Lorna is a trusted advisor to Big Cap companies and to Whitehall, and is also a member of the Women in Finance Advisory Board.