Women in Leadership

The clamour for more Women in Leadership – does it have to improve business performance?

The debate about whether more women in the Boardroom is a good thing has been raging for decades, and it seems that a consensus is not much closer now than it’s ever been!

Certainly, most people believe that a better gender (and indeed wider diversity) balance has lots of positives, many of the perceived benefits result from cultural changes to – for example – the attitude of the organisation to risk, or towards employee engagement. But there is still conflicting evidence that this improves business performance, and here lies the crux of the argument.

Participants on Henley Business School’s Advanced Management Programme have long recognised that an awareness of the kinds of differences exhibited by men and women in their approach to leadership – as with any other cultural nuances – is vital to engagement, and therefore to effective leadership. And having a balance of approaches also seems to reap rewards.

But there is undoubtedly an increasing body of evidence to support the view that Boards which include women outperform those that don’t, although there are still some interesting provisos:

  • This appears to be much more obviously the case during economic downturns (which is slightly worrying, given that we’re about to experience an upturn!)
  • It seems to be most apparent in consumer-orientated companies, and those with a largely female workforce
  • There seems to be a threshold level of women on the Board to make a significant difference (with a critical mass of at least three female Board members the culture of a Board is more likely to be impacted)
  • Where quotas dictate that women MUST be represented on the Board, there is research which shows that in some instances quality standard dropped, and performance deteriorated accordingly.

There is a strong argument that if women’s inclusion in the Boardroom is to be sustainable, it must ultimately prove that it is commercially viable, and in any competitive market, that means that it has to optimise organisational performance.

But of course, the pipeline takes time to deliver the right women to the Boardroom, so the challenge for all organisations is to ensure that the right recruits are given the right training, and that there is a clear understanding and belief that a Boardroom position is not only attainable, but desirable.

And the obvious biological issue remains a challenging one for women to overcome.

At a Diversity Debate hosted by the Henley Business School in June 2013, the issue of maternity was described as ‘the elephant in the Boardroom’ (no pun intended), but Syl Saller, then CMO at Diageo, made her feelings clear, saying that: ‘We must not use maternity as a discriminator; we must find creative and practical solutions to the issue of continuity so that women are not disadvantaged when they return to the workplace.’

Despite all the obstacles, the UK Government’s 2013 report on ‘Women on Boards’ shows that women now account for 17.3% of FTSE100 Boards, and 34% of all new appointments made in the year 2012-13, with projections suggesting that a quarter of all FTSE100 Board members will be women by 2015, and over a third by 2020.

But any appointment has to be on merit to be sustainable. And whilst it could be criticised as short-termism, financial profitability is still seen as preferable to cultural improvement, so for the time being at least, the pressure to demonstrate a positive return on investment still outweighs the ‘softer’ benefits that women bring to the Boardroom and means that the targets remain relatively modest.

However, Moira Clark, who teaches on the Henley Advanced Management Programme and is a Professor of Strategic Marketing, as well as the School’s Head of Marketing & Reputation, is absolutely clear that women more than earn their place:

‘Women consistently outperform men in education, and are the main consumers of most products and services. They bring a different, right-brain perspective to management which delivers a sustainable competitive advantage that is much more difficult to copy. It’s less tangible, but brands such as Apple, Virgin and John Lewis exhibit it in abundance.

I suspect that one of the reasons why women haven’t progressed as much as they should have done in terms of Boardroom presence is that they don’t have the time or inclination to play the games or indulge in impression management so enjoyed by many men at Board level. So they leave and work for themselves, where they are able to dictate the rules of engagement.

On the Advanced Management Programme, we recognise the value of the recent feminisation of marketing, and the economic power of women. These are important topics, and are ignored at your peril!’

The Henley Advanced Management Programme is a modular programme for senior managers. The next programme starts  14 September 2014, see  www.henley.ac.uk/amp

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