Innovation and idea generation are the greatest benefits to organisations that embrace male and female leadership, but boardroom diversity is still low across most developed countries, according to new research by Deloitte.
The online study, which polled 720 business leaders from 42 countries on how inclusive leadership impacts business, found innovation and idea generation the top benefit (selected by 49% of respondents), followed by increased employee engagement (28%) and greater retention and advancement of women (15%).
“Respondents indicated that companies that recognise the importance of gender diversity will reap the rewards,” Deloitte global diversity leader Vanessa Borchers said in a news release. “Traditional approaches to diversity are getting women in the door and fostering retention and development, but we are still not seeing women advance to leadership positions quickly enough.”
Although 51% of respondents said inclusive leadership was a key area of focus for their organisation, only a low proportion of listed companies across the world embrace diversity at the boardroom level, according to a separate Deloitte report, Women in the Boardroom: A Global Perspective.
The country with the highest level of boardroom gender diversity is Norway, where 42% of those serving on the boards of large listed companies in 2012 were women. Norway was also the first country to introduce board gender quotas into law in 2005. The next most gender-diverse boardrooms are found in Nordic neighbours Finland (27%) and Sweden (25%), while the poorest diversity is in Asia, led by Hong Kong, where only 9% of those serving on boards are women.
In the UK, women account for 15% of FTSE 100 board members. Results of a recently released Cranfield School of Management study suggested that a government-set, voluntary target of 25% female membership on FTSE 100 boards by 2015 may be missed. The Cranfield study found that in March 2013 the FTSE 100 had only 17.3% women directors, up from 15% a year earlier and 12.5% in 2010.
In the US, women constitute 12.6% of board members, according to the Deloitte survey, an improvement of a meagre 0.3 percentage points in the past year.
“When it comes to gender parity on boards, the pace of change in the United States has been slow by virtually any measure,” said Nicole Sandford, national practice leader for governance services at Deloitte US.
Nearly all of the countries studied by Deloitte showed a slow improvement of between zero and 3% in female board representation. France bucked the trend by improving diversity by 5.8%.
The report noted that 21 EU countries have adopted legislation, setting a target of 30% female board representation by 2015. However, companies will not face sanctions if the targets are not met.
According to Deloitte’s online survey, 41% of respondents felt the main barrier to inclusive leadership was a failure to recognise a return on investment from having a gender-diverse workforce.
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“More Women Join Boards, but Progress Comes Slowly”: In the past six years, women joined boards of directors of S&P 1500 companies in increasing numbers, diversifying the boards’ expertise, skill sets and viewpoints. But one-fourth of boards still did not have women directors in 2012.
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