- May 6 2015
Moderating was Dr. Rohini Anand, Chief Diversity and Corporate Responsibility Officer at Sodexo, who holds the subject dear. At Sodexo, 25 percent of the top managers are women, and the company’s own recent gender balance study shows an impressive correlation between gender equality and certain performance indicators.
Sandrine Devillard, a director at McKinsey in Paris, kicked off the conversation by saying that women are still grossly underrepresented at the board level and on executive committees, even though they make up more than half of university graduates worldwide.
She said that companies with gender diverse leadership teams outperform the others by huge margins—almost 50 percent for average return on equity and close to 60 percent for average ebit margin, across all industry sectors.
Dr. Rohini Anand mentioned that Sodexo’s gender balance study reinforced these findings. Balance is key, and there is a sweet spot. She noted that companies thrive when their workforce reaches an optimal band of 40 to 60 percent for either sex. When the proportion goes beyond these numbers, performance drops again. Kolb, who directs the Gender Secretariat at the International Finance Corporation (part of the World Bank Group), added that their research in emerging economies confirmed that the right mix of gender diversity is the best way forward for companies.
Yoshino, author and NYU law professor, added that for companies to reap the benefits of gender balance, employees must feel that they can be themselves. Most people tend to "cover" in the workplace, downplaying aspects of their personalities in order to fit in with the mainstream. Ethnic minorities assimilate by acting more white, gays and lesbians feel they must act more straight.
“It’s not enough to have bodies in the room, even a critical mass of bodies, if they’re simply allowed to have different chromosomes and not allowed to act differently,” Yoshino said. Research shows that when leaders expect minority groups to cover, their sense of commitment to that organization diminishes by 50 percent.
Yoshino said that the case of women is even more complicated, because the dominant group expects them to “reverse cover”—to be “masculine” enough to be respected as workers but “feminine” enough to be respected as women.
Hewlett, CEO of the think tank Center for Talent Innovation, added to this by saying that women are in a double-bind at the workplace. They have to show commitment at work, but it is also frowned upon if they don’t have children, because, she said, “how can they be trusted?” In a recent survey, 78 percent of respondents didn’t want to sponsor women without children because they saw them as “even more dangerous” than those with.
“Leadership styles matter tremendously, and the ability to value difference is huge,” Hewlett said, adding that if you have at least three kinds of diversity around the table, it greatly improves innovation.
Hewlett also brought up “gender smarts,” or leadership skills that women generally apply more frequently than men (such as participative decision making and people development) that benefit all by improving business performance.
The panel concluded that there is hope for a change in corporate culture and mindset. Women must be encouraged to succeed, because gender diversity at the top will surely boost the bottom line.
The issue of gender balance is back in the public eye, with new studies showing that companies that promote more women to executive positions perform significantly better. Tuesday afternoon, gender balance took center stage during a panel discussion at the first international Quality of Life Conference, where the speakers—Sylvia Ann Hewlett, Sandrine Devillard, Henriette Kolb, and Kenji Yoshino—all shared surprising data of their own.
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