Women and Family Business – 3 Differences between women and men in the boardroom
Over the past decade, the number of women participating in family businesses and taking on roles with more responsibility has been on the rise. Every business owner should focus on this growing trend because research shows that 70 percent of today’s family businesses are influenced internally by female directors or plan to have female leadership in their family enterprise in the near future.
The female perspective brings not only better financial performance, but better overall performance, too. Female executives build strong relationships and they bring crisp, strategic thinking to the boardroom. It is essential for company leaders to be aware of the differences between men and women in the boardroom and to adapt and implement a plan to attract the most qualified female members of their family or community. The most significant impact of female leadership is on strategic planning, long-term sustainability, and relationship building.
The Female Perspective and Strategic Planning
Research has shown that there’s little correlation between the IQs of individual board members and collective intelligence. However, the collective intelligence of a board rises if the board includes women. The studies have highlighted the performance of women on tasks related to complex problem solving, strategic planning and decision-making.
The findings indicate that a group’s collective intelligence gets heightened by the inclusion of women and their enhanced abilities regarding listening, collaborating, and intuitiveness. Take the CIA for example. The organization made a notable transformation of its culture by ensuring greater representation for women in senior positions, and they have also explicitly recognized that it was the women on their team who discovered Bin Laden’s location.
Long-term Sustainability and Better Financial Performance
A wealth of studies demonstrates that having women in the leadership structure makes economic sense for businesses. Research on gender diversity and corporate performance conducted by Credit Suisse Research Institute shows that more women in strategic roles bring not only better financial performance, but also a better all-around performance.
The research highlights four key findings:
Higher return on equity (ROE)
Higher price/book value (P/BV) multiples
Better average growth