Emerging Markets Business Summer 2017 | Page 76

LEADERSHIP 76 EMB 77 WOMEN LEADERS CAN GROW YOUR BUSINESS BY RANIA HABIBY ANDERSON s we approach the middle of 2017, there is much to celebrate regarding the advancement of women in business, yet at leadership levels, the statistics are still grim. On the 2016 Fortune 500 list, just 21 companies have a woman at the helm—three less than the previous two years. And the USA, which dominates the list, is hardly an isolated case, with research from Deloitte indicating that women hold only 12 percent of the world’s board seats. For emerging economies facing headwinds and struggling for growth, this marks a missed opportunity, for hidden in plain sight is their greatest asset: an under-utilized pool of female talent with the potential to boost not just company profits, but national economies. Emerging markets have long relied on raw materials, trade agreements, cheaper labor costs and fiscal or monetary policy to drive their economies, but they have failed to engage the millions of highly-qualified women who can drive innovation, new jobs and growth. A EMERGING MARKETS BUSINESS SUMMER 2017 THE RESEARCH IS COMPELLING Research findings show that more women leaders and diverse teams result in greater company performance. In March this year, the International Finance Corporation (IFC) released an important global study, with research focused on emerging markets in Africa, Asia and the Middle East. Titled ‘Investing in Women: New Evidence for the Business Case’, the study finds that companies with gender-diverse boards generate a higher return on equity than those without, and that they outperform in terms of share price performance during times of crisis or volatility. According to the study, high-performing companies are also nearly 50 percent more likely than low-performing companies to report that men and women have equal influence on strategy development. What’s more, investors in companies with strong gender diversity strategies receive excess returns running at a compound annual growth rate of 3.5 percent. ISSUE NO. 3 A study from Credit Suisse and another from The Peterson Institute for International Economics (PIIE) and Ernst & Young (EY) also highlight the impact that women in leadership positions can have on company performance. Credit Suisse’s research showed that between 2012 and 2014, companies with a market cap of more than US$10 billion with at least one woman on the board, outperformed other large companies by five percentage points on a sector-neutral basis. For its part, the study from PIIE and EY analyzed results from 21,980 global publicly traded companies in 91 countries, revealing that an organization with 30 percent female leaders could add up to six percentage points to its net margin. These findings are particularly pertinent to low and middle income countries, given the important role of women in contributing to the development of economies. According to the UN Economic and Social Council, investing in women, particularly in emerging markets, produces higher returns than investing in men, because » RANIA HABIBY ANDERSON is a speaker, coach and expert on the career advancement of women in emerging economies. She is the author of Undeterred: The Six Success Habits of Women in Emerging Economies. AT A GLANCE The premise that women in the workplace is a challenge to solve, rather than a solution to economic woes is fundamentally flawed. If emerging markets were to engage their millions of highly-qualified women, then companies and economies would be all the better for it. All that is missing are simple, straightforward actions by managers and leaders to actively engage in the advancement of women. EMBreview.org