Women-led cos more likely to outperform rivals: Report

Companies with more participation of women at management level have higher possibility of outperforming the rivals, according to Credit Suisse report 'Women in Business'.

The report revealed that companies with higher number of women in their board are also likely to give more dividends to their shareholders.

"Greater diversity in boards and management are empirically associated with higher returns on equity, higher price or book valuations and superior stock price performance.

We find no evidence that female-led companies reflect greater financial conservatism where leverage is concerned. Also, dividend payout ratios have been shown to be higher," the report said.

However, the study shows that the proportion of women in senior management is similar to that on the boards of companies and their roles are arguably skewed towards areas of less influence or offer less opportunity to move into the most senior positions in a firm.

The report was conducted by identifying and mapping more than 28,000 senior managers at over 3,000 companies, including in India, actively covered by Credit Suisse analysts worldwide – The Credit Suisse Gender 3000.

The management power line reveals the lowest women representation at the CEO level rising gradually through business management and operational roles, CFO and strategy and, finally, to shared services where their positions are most concentrated.

"We also find that female representation is higher in new economy companies and in non-manual labour (mostly services) companies.

While we see female under-representation and management gaps across varying sectors, country and cultural factors are far more influential," the report said.

Main obstacles in achieving greater gender diversity are cultural biases, workplace-related biases and structural or policy issues, the report pointed out.

According to the 'Women in Business' report, cultural and education issues are the most challenging to overcome in the short term. However, it said, policy can improve the current situation significantly.

It also noted that quotas have not had any significant impact yet beyond the boards. Quotas, the report said, have led to 'tokenism' in some areas rather than an opportunity to create a better management structure.

"Yet, we think that the introduction of quotas has generated a healthy debate and led companies and policy makers to consider other measures to improve the gender gap.

We believe that rather than setting quotas, regulators should consider improving transparency on this issue by requiring publicly traded companies to disclose the gender diversity numbers at different levels of the organisational structure or at the very least at the top management level," it pointed out.