Want to be 42% More Profitable? Diversify Your Board
In Fortune 1000 companies, only 11% of corporate directors are women. However:
- Women comprise about 46% of the total U.S. workforce
- Over half of all managers are women
- Women are responsible for almost 80% of all consumer spending
- There are over 10 million majority-owned, privately-held, women-owned firms in the U.S., employing over 18 million people and generating $2.32 trillion in sales
And most compelling of the statistics is this: Companies with a diverse board that is compromised of or over 20% women are 42% more profitable.
Intrigued? So were we.
On Wednesday, November 30th, the CFO RoundTable welcomed 2020 Women on Boards, a grassroots not-for-profit organization whose mission is to increase the percentage of women on U.S. public boards to 20% or greater by the year 2020. Founded by Stephanie Sonnabend, CEO and President of Sonesta International Hotels Corporation, and Malli Gero, principal of Gero Communications, the campaigns’ mission is to redefine good corporate governance and gender diversity standards and create a cultural imperative for corporate action.
Behind the statistics lies the question ‘Why are companies with diverse boards more profitable than others?’ During her presentation, Sonnabend offered several reasons, including:
- The inclusion of women on boards means a company can enjoy a diversity in thought and perspectives to tackle today’s difficult issues
- A diverse and balanced corporate board of directors is a better representative of the company in which it governs, including its shareholders, employees, and customers
- A diverse board and the company it governs is more nimble, strategic, and well-informed, enabling the organization to thrive in a global economy that is rapidly accelerating and changing
For those attendees who were interested in pursuing a board position, Sonnabend also offered a few tips on how to prepare oneself, including:
- Be a financial expert, and have comfort in reading balance sheets, P&L statements, etc.
- Work to secure a C-level title, as the experience of the C-suite is viewed as the most attractive and relevant to companies searching for more board members.
- Expand your network, and make it known that you are interested in serving on a board
- Promote yourself through online and face-to-face communications
- Take one of the many training programs offered by Director-level organizations and universities on how to properly serve and contribute as a board member
A few resources offered by 2020 Women on Boards include:
To view the full presentation in PDF format by 2020 Women on Boards, please click here. For more information, we encourage you to visit their site today at www.2020wob.com.