The more women in a company,the more profitable it is

The 2024 SKEMA Observatory report on the feminisation of companies shows that the organisations with the most women are doing better than the others. With figures and explanations.

Ask any business leader and they’ll tell you that women are an asset. That gender diversity, and diversity in itself, should be encouraged. Yes, but… very few people can tell you why. “Why?” seems a simple enough question. But if you can provide an answer, it can be very convincing. Apart from any considerations of social justice, why should companies be feminised? Professor Michel Ferrary and the SKEMA Observatory on the feminisation of companies have an answer for the most cynical: “there is a correlation between the feminisation of companies and operational profitability.”

The 2024 Observatory report says it all: “During 2022, the operational profitability of the 10 companies [in the CAC 40] with the most women in management was 59.38% higher than that of the 10 with the fewest women in management (20.56% versus 12.90%).” Do you want more? “The social responsibility risks of the 10 companies with the most women in management were 30.13% lower than those of the 10 companies with the fewest women in management (15.4 versus 22.04).” Likewise with “environmental risks”: with the 10 companies with the most women in management, these were “48.97% lower than in the 10 companies with the fewest women in management (1.97 versus 6).” In addition, “the financial markets believe that the 10 companies with the most women in management represent a lower investment risk” and “have higher prospects for growth.” These correlations are all even stronger if we look at the feminisation of the “workforce” and, to be fair, a little less as regards that of the Executive Committee.

In its 2024 report, the SKEMA Observatory on the feminisation of companies also gives reasons for these results:

“Hiring both women and men expands the size of the labour market and thus increases the likelihood of hiring higher quality and more competent human resources.”
“Half of all consumers are women. Employing women enables a clearer understanding of customers‘ expectations (market intelligence) and an improved commercial relationship (B to B and B to C).”
“The diversity of representation systems combined with a diversity of experience and convictions improves decision-making processes and creativity in organisations.”
“Women are more stable employees in the company (fewer resignations than men): this helps to retain strategic skills within the organisation and makes investment in training more worthwhile.”
“The promotion of women managers is a motivating factor for all the women in the company who aspire to professional advancement.”
“Diversity is proof of a company’s openness, which is appreciated by its stakeholders (customers, public authorities, shareholders, rating agencies, the media, etc.).”

This time, there’s no doubt: women are an asset to a company in more ways than one.

There is a correlation between the feminisation of companies and operational profitability.

Michel Ferrary, SKEMA Business School