31st March 2022

Benefits of Female Leadership in Organisations

In recent times, the names Jacinda Ardern and Kamala Harris have become familiar, and they are personalities that many of us might look up to, but what do they have in common? They are all women who brought their convictions, energies, and strengths to their innovative efforts and are leaders who made progress under difficult circumstances. Although there is a difference in their respective accomplishments, they share common characteristics that enabled them to attain leadership roles and create change.

 

Benefits of Female Leadership in Organisations 1

The woman’s role in organisations and their emergence into leadership has been steadily growing since the 1970s [1]. This is particularly due to the social and cultural forces such as globalisation, change in markets and more opportunities for women to be in education. The growth of women in senior leadership roles has increased, particularly in senior executive positions. For instance, the representation of women in senior executive positions has increased from 17% in 2015 to 21% in 2020 [2]. Furthermore, the 2020 Global Gender Gap report showed that 44% of companies have three or more women in their senior executive positions, which has increased from 29% of companies in 2015 [3]. These data show that women have taken opportunities using the unique characteristics and styles in which they lead.

Recent research has shown that women bring a varied set of strengths to leadership, which benefit teams and organisations at local, national, and global levels. They have more transformational, participative, and inclusive leadership styles. The survey results from Pew Research Centre Social and Demographic Trends survey in 2008 suggested that women more frequently exhibit leadership traits such as honesty and intelligence that are highly applicable to future global challenges [4].

So, what are the benefits that female leaders can bring to your organisation?

 Benefits of female leadership

Benefits of Female Leadership in Organisations 2

Advanced diversity equity and inclusion

Having female leaders has been shown to increase diversity and inclusion within the organisation. A recent study that explored gender spillovers in career advancement in private-sector establishments in Norway found that having an increased number of female leaders reduced the gender gap in promotions [5]. Having female leaders enables other female workers an opportunity to have a mentor/role model in a leadership position whom they can ask for advice about their careers and advancement.

Better financial performance

Women in leadership roles can increase the financial performance of an organisation. For example, a meta-analytic study that compares data from multiple studies on a particular topic showed female board representation is positively related to financial returns. Additionally, the study also found that this relationship is more positive in countries with stronger shareholder protections. Having a diverse board provides diverse perspectives hence enhancing the performance of the organisation [6].

Therefore, having female leaders in an organisation provides different perspectives to a board and helps to improve a firm’s ability to generate profit from its assets and investments [7]. Moreover, Female leaders are shown to have values that provoke multiple viewpoints and cultivate deliberation in decision-making.

Improved interpersonal relations

Female leaders are consistently shown to have a higher rate of relationship building, which can help the organisation to negotiate such things as difficult contracts. The ability to communicate with people is a fundamental skill for a successful leader and this is something that the majority of women possess naturally.

Increased Team Wellbeing

Female leaders help to promote the well-being and motivation of the team. An analysis of women’s impact on cooperative enterprises shows that female leaders can influence the team to have greater motivation and better results [8]. Additionally, female leaders can increase work-life balance. A McKinsey & Company study found that employees with female leaders are more likely to say that their manager supported and helped them [2].

How can Impact Psychology for Business help you?

Studies have suggested that leadership training programmes for women can bring many benefits such as increased self-confidence and increased networking skills. This helps to unlock potential and strengthen commitments to being a leader [9]. We have broad experience in designing and delivering bespoke leadership programmes and providing coaching to high-level managers in the public and private sectors.

Click here to talk to us about how we can support female leaders.

Useful Resources

[1] Chandler, D. (2011). What women bring to the exercise of leadership. Journal of strategic leadership3(2), 1-12.

[2] Women in the Workplace 2021 (2021), Retrieved from https://www.mckinsey.com/featured-insights/diversity-and-inclusion/women-in-the-workplace

[3] Global Gender Gap Report 2020 (2020). Retrieved from https://www3.weforum.org/docs/WEF_GGGR_2020.pdf

[4] Pew Research Center. (2008). Men or women: Who’s the better leader? (Complete report). Pew Research Center Publications. Retrieved from http://pewsocialtrends.org/files/2010/10/gender-leadership.pd

[5] Kunze, A., & Miller, A. R. (2017). Women helping women? Evidence from private sector data on workplace hierarchies. Review of Economics and Statistics99(5), 769-775.

[6] Post, C., & Byron, K. (2015). Women on boards and firm financial performance: A meta-analysis. Academy of Management Journal58(5), 1546-1571.

[7] Miller, T. & Triana, M. D. C. 2009. Demographic diversity in the boardroom: Mediators of the board-diversity – firm performance relationship. Journal of Management Studies, 46: 755-786.

[8] Female Leadership: The Impact on Organizations (2018), Retrieved from https://www.ie.edu/insights/articles/female-leadership-the-impact-on-organizations/

[9]Harris, C. A., & Leberman, S. I. (2012). Leadership development for women in New Zealand universities: Learning from the New Zealand women in leadership program. Advances in Developing Human Resources14(1), 28-44.

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