As the UK faces the toughest economic climate in over 50 years, it is time for the business world to review, learn and get smarter. Women in business are a critical part of the solution.
The evidence is now compelling that having more women at the top in business improves performance. Report after report confirms that Boards and senior management teams with at least 30% female members perform better in every area of operations and leadership and return profits three times higher. It is clearly time to dilute and diversify the male monoculture running our companies.
Darwin found that species-rich communities have a greater level of productivity. That is true of business too. There is even a mathematical formula to show that a diverse group almost always outperforms a homogeneous group by a substantial margin.
Despite this, chasmic gender leadership and pay gaps remain across the business spectrum. More and more talented women are opting out and building their own businesses on their own terms instead. We now have more than 1 million women who work for themselves.
Those entrepreneurial women comprise a quiet revolution, changing the face of business from the bottom up. In common with women throughout the world, they are investing higher levels of their wealth and time to support their community and family. They are also generally more values-led and at the forefront of ethical and environmental businesses. While women comprise just 14% of all business owners, they are 50% of social enterprise leaders.
In the Darwinian sense again, those women-led businesses are ‘fit’ and should be better able to survive the economic storm. They tend to have lower levels of debt, are more likely to have businesses plans and processes in place and to take-up business support and training opportunities. But female dominated sectors like retail, hospitality and services are in the eye of this recessionary storm, and so far Government support has been focused on male led industries. With women being made redundant at double the rate of men in the last quarter, there are real worries that the progress made towards equality at work could be jeopardised.
There is now no question that gender-balanced business leadership is important for business and social wellbeing. But it will not be achieved without smart actions that protect equality and get behind talented women.
First published as the Foreword to the Guardian Women in Business supplement, March 2009.