A company can do nothing better than to take on a woman, the Credit Suisse Research Institute reveals. Their study shows that there is a 26% difference between the performance of companies having even one woman among its directors and those whose directors are men only – in favor of the former, naturally!
The institute analyzed the activity of almost 2,500 companies, both with and without female directors, over a period of six years, and summed up the stats in the report entitled “Gender Diversity and Corporate Performance.”
The research, while discovering next to no difference in performance (in terms of share prices) between the two kinds of companies at the time of economic development, found that after the financial crisis struck in 2008, the difference became remarkable: companies with women on board showed much higher share prices.
Stefano Natella, Co-Head of Securities Research & Analytics, summed it up writing that gender diversity on the board “is a valuable additional metric to consider” for investors when planning investments, and the evidence of this is “striking.”
For instance, the average return on equity (ROE) of companies with a mixed-gender board displays 4% rise over men-directed companies (16% against 12%). Another piece of evidence is 50% net debt to equity of men-driven companies to 48% of companies with men and women on the board.
The report further reveals that net income growth figures for the 6-year period are 14% for both-sexes-on-the-board companies and 10% for ones with no females active on the board.
According to Credit Suisse, the highest raise in female board representation in this timeframe have occurred in European companies. In 2005 women were represented on the board of directors in less than half of European companies, while by 2012 the per cent rate comes up to 84%! Naturally, there is a wide variation from country to country with 0% in Hungary or Peru and 100% in Sweden’s blue chips.