By Michael Brush, MarketWatch
(Updates story originally published in March to correct the spelling of the name of Tellurian’s Meg Gentle.)
Women’s History Month (March) and International Women’s Day (March 8) celebrate the importance of gender parity as a matter of basic human rights.
But gender-equality proponents might be wise to emphasize another angle as well: Women in management positions can help you make money as an investor and a business owner.
That’s the conclusion of McKinsey & Co., the management-consulting firm. For over a decade, McKinsey studies have concluded that companies with more women in upper management are likely to be more profitable. And, conversely, companies with low gender diversity up top are more likely to underperform.
Of course, correlation, which is what McKinsey found, is not causation. So it’s not clear whether women necessarily bring special management skills, or whether companies that are more likely to hire women also have the cultural traits that breed success.
Probably, it’s some mix of the two. McKinsey thinks so. It offers these reasons for the link between management gender diversity and profitability.
• Companies with more diverse management attract more talent. This makes sense because, at the very least, it means they open up their search to a broader swath of the population by being more open to putting women in upper management.
• Women are more likely to practice five of the nine management behaviors that McKinsey thinks are key to a company’s success. They include: People development (mentoring, listening to needs and concerns); defining expectations and rewarding achievement; promoting respect and ethical behavior; presenting a compelling vision and inspiring optimism about it; and encouraging people to participate in decisions (team building).
• Gender diversity in management seems to increase creativity, innovation and customer insight. Maybe it’s because more diverse teams bring different perspectives and approaches to problem solving, says McKinsey.
• Gender diversity improves a company’s reputation among customers and supply-chain partners.
(For the latest McKinsey research on diversity in management, click here .)
Big picture, more gender diversity at companies can create macroeconomic benefits. McKinsey Global Institute thinks bringing more women into the workplace could boost global gross domestic product by $12 trillion annually.
Those potential benefits appear obvious. So it’s no surprise that a McKinsey survey a few years ago found that 72% of companies think there is a connection between leadership diversity and success. But then things got weird. Only 28% of them said gender diversity was a top priority. Recent McKinsey research also finds that women are in only 25% of management positions globally.
Talk about a disappointing disconnect.
So to look on the bright side, let’s celebrate the companies that do get it. Here’s a look at five companies with women at the helm. It’s refreshing that many are in what you might think of as traditionally male-dominated fields — such as technology, steel, hard science research and energy.