There is now so much accumulated evidence that having women in senior leadership roles benefits a company’s bottom line and delivers a raft of other improvements to business success, it’s astonishing that the proportion of women in senior management in Australia is still so low.
According to the government’s Workplace Gender Equality Agency, women make up around half of the Australian workforce, but occupy only one-third of key management positions. A similar situation occurs worldwide, but as a result of the coronavirus pandemic the gender disparity in leadership, and the consequent loss to business growth, looks likely to get worse rather than better.
Pandemic’s disproportionate negative impact on female employees
According to the Harvard Business Review, tens of millions of women have left the global workforce since the start of the pandemic, the vast majority of them permanently. Global management consultancy group McKinsey’s Women in the Workplace 2021 survey demonstrates that female managers and senior leaders are experiencing significantly more burnout, stress and exhaustion than their male counterparts.
The worldwide workforce participation rate for women has declined to less than 47% for women, compared with 72% for men. This translates into disastrous outcomes for gender equity, female career trajectories, and women in leadership generally.
However, it is equally detrimental for the businesses with departing female leaders, because they have said goodbye to some of their most inspiring and valuable talent.
Contribution made by women in senior leadership
The increased business success resulting from the activities of women in leadership is not a matter of opinion or anecdotal evidence: it’s proved by hard facts.
Key leadership skills
Leadership consultants Zenger Folkman recently updated their review of women in leadership positions, and found that women rated better than men on key leadership capabilities, including:
- Inspiring and motivating others
- Building relationships
- Championing change
- Communicating effectively
Engagement and productivity
A recent study by Potential Project, a global management and leadership consultancy, found that both job engagement and job performance are higher when a woman leads either a woman or a man. It’s estimated that women leaders saved their employers an enormous annual sum by avoiding lost productivity and the cost of employee replacement.
A study conducted by the IZA Institute of Labor Economics found that there is a positive and significant effect on team performance when women lead.
The McKinsey report (referred to above) found that employees with women managers are more likely to say that their manager has supported and helped them over the previous year. This included:
- Making sure workload was manageable
- Helping navigate work-life balance
- Taking actions to prevent burnout
- Providing emotional support
- Checking in on overall wellbeing
Diversity, equity and inclusion (DEI)
The McKinsey report also revealed that women leaders, compared with men at the same level, are up to twice as likely to spend substantial time on DEI work that falls outside their formal job responsibilities, including supporting Employee Resource Groups, organising events, and recruiting employees from underrepresented groups.
Last but not least, female leaders can bring about an improvement to your bottom line. A 2019 global analysis by Standard & Poor found that, on average, companies who appointed a female CFO saw significant gains in returns over the three-year period after appointment. And UK government research has revealed that companies with more female leaders outperform those dominated by men.
What you can do to retain and develop female leaders
1. Embrace diversity and gender equity
Your entire organisation, from the top down, needs to get involved in promoting gender diversity and equity. Consider which of your systems and practices (such as how remuneration rates are set or internal promotions made) either support or dismiss talented women.
2. Address burnout
Given the statistics around female leadership burnout, especially post-pandemic, it’s time to focus on the well-being of all employees. One of the simplest ways to do this is to provide flexible conditions so that women with caring responsibilities can organise their working hours and locations in a way that will allow them to bring their best selves to both roles.
3. Create career paths
Find ways to create career paths for women in your organisation, both as a group and as individuals. Having regular meetings with female employees to discuss how they can advance, and setting a trajectory with milestones, can help you to retain talented women, especially the younger ones.
4. Promote internal networks for women
Prioritise sponsoring and mentoring for female employees. Potential women leaders need both sponsors (existing senior leaders who will advocate for them and help them obtain challenging assignments) and mentors (to provide guidance for career choices and decisions).
Looking forward, Bentleys is committed to championing diversity and inclusion within our network. In a more recent example, we announced the promotion of a number of high performing leaders across the network, and of these promotions, a significant proportion were female, with many more promotions happening across different levels of the network.
More advice is available
Do you need help to develop and support your organisation’s talented women, to promote the business growth and success they demonstrably provide? Contact us today to be put in touch with our Business Advisory team for a no-obligation chat. We can help you get where you want to be.
Disclaimer: This information is general in nature and should not be relied on as advice. It does not take into account the objectives, financial situation or needs of any particular person. You need to consider your financial situation and needs and seek professional advice before making any decisions based on this information.