AUGUST 2012: Is gender diversity to the benefit of all stakeholders? In this report, Credit Suisse extend their analysis of board structure and corporate performance to consider senior management representation, introducing the Credit Suisse Gender 3000.
Key statistics from the report:
- Diversity is in focus today, not just for equality and governance priorities, but for the benefits for companies and shareholders.
- Since 2005, companies with at least 1 female director have returned a compound 3.7% above their male-only counterparts
- Since 2005, ROEs of companies with a female board member have averaged 14.1% vs 11.2% for all male boards.
- Where >15% of senior management is female, ROEs in 2013 were 14.7% compared to 9.7% at companies with <10%
- P/BV have averaged 2.3x since 2005 for companies with a female board director vs 1.8x for all male boards
- 2013 P/BV for companies with >15% female senior management was 2.6x vs 2.0x for those with <10%
- Perhaps surprisingly, companies with higher female participation in management have higher leverage, 57% where there is >15% in 2013 vs 35% where there is <10%.
- In the CS Gender 3000 women make up 12.7% of board directors globally and 12.9% of senior managers – CEOs and direct reports. Women in management have disproportionally high representation in functions with less responsibility and fewer chances for progression to top management and board the “Management Power Line”.
SEP 2014 – 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 the different levels of the organizational structure or at the very least at the top management level.