Do Female-Led Businesses Perform Better Than Those Run by Men?


The short answer is 'hell yes.'

Ed’s note: This post was written by guest editor Anna Thomas, COO of Stockdale & Leggo.

Traditionally, the domain of business belonged to men. Over the course of a century, women have slowly trickled in across the industries to change the tide of corporate culture. It’s been a slow, continual process as we work towards closing the gap on gender inequality.

As women climb the corporate ladder and walk the path of career success, we are mastering a broad set of leadership styles and leveraging them to drive better results within organisations. Despite the many adversities women face in the workplace, studies report that businesses run by women are commercially performing better than those led by men.

By eliminating negative self-talk, guilt and limiting beliefs, and by supporting one another we can embrace our inherent power as women and achieve greater success.

So, are female CEOs and founders a commercial game changer for businesses? And why are they producing better results than their male counterparts?

The simple answer is “the woman effect”… It’s been working its magic all over the world, and I believe it will continue to transform the success of businesses over the next decade, as we move away from outdated patriarchal modalities. With the steady influx of women in the workplace, there has been a clear shift towards a more people-based culture and more satisfying workplace environments.

What is The Woman Effect?

The McKinsey Women Matter Report discovered an interesting finding: companies with three or more women on their executive committees outperform those companies with primarily male board members. A higher participation of women in management grows the company’s bottom line by almost 50 per cent compared to companies led by men, which achieved half the return at 25 per cent.

According to a new study released today for International Women’s Day by SEEK, more than 65 per cent of Australia’s workforce would like to see more women in leadership roles. Across sector, country and organisation, the results are the same – more women in senior executive roles provides a greater financial performance and a higher ROI for those with a gender-balanced workplace.

Anna Thomas, COO of Stockdale & Leggo

Companies with more female leaders are more socially responsible, philanthropic, and have a better work culture. However, women tend to hold themselves back in business and wait until they are 100 per cent ready to take on a promotion. It’s time to put the worries and fears aside. Research shows that by just simply showing up, speaking up and encouraging other women, your business will ultimately flourish. It’s the woman effect!

Dana Theus, founder of InPower Women, says, “The Woman Effect is in our blood, hearts and minds. It’s part of who we are.” Simple and beautiful at its core, the effect means we have the ability to heal the economy and enact positive change by embracing our natural inbuilt power.

Women are bringing fresh perspective to the corporate game, despite cultural barriers and stereotypes surrounding them. Female leaders have the skills to strengthen organisational performance, and are diverse in their leadership scope, with a focus on developing the team, setting expectations, coaching, inspiring and participating in the decision-making processes. These areas are where the future of business is headed and where financial growth will be secured.

Gender-balanced leadership

Yes, women are better suited to leadership roles than men. Contrary to this, the actual number of women in management positions is significantly lower than males, and tends to decline the higher up the executive ladder you go. In order to bridge this gap, we need to create more inclusive workplaces.

As COO of a large real estate network, Stockdale and Leggo, I have witnessed the power of gender parity and how diverse teams outperform homogeneous ones every time. By mixing it up with both men and women in senior roles, we open up the dialogue to allow for innovation, forward-thinking practices, strategies and change. Companies achieving diversity attain better financial results and outperform those that don’t.

The problem of gender inequality still largely exists, as evidenced by the gender pay gap. However, gender balance among board directors and senior executives is essential if we want to increase productivity, profitability, and improve corporate culture and sustainability. A gender balance actually increases the working conditions for women, and decreases the pay gap.

A supportive environment

If female leaders are so instrumental in driving greater profits, then why is there still a gender parity? Why aren’t we seeing more women in senior executive roles? Essentially, it boils down to preconditioned biases of gender normative roles, unsupportive work environments, and dysfunctional company culture.

Throughout my years in business, I have noticed that men tend to promote people who are like themselves – due mostly to an unconscious bias. They dominate the decision making, including promotions.

By incorporating sponsorship programs, we can help create a level-playing field. AECOM has commenced a sponsorship program to support progression of senior female leaders into the most senior of roles. We need to see more initiatives like this, and advocate for them.

Women are ambitious, but a supportive environment is required to feel they can succeed in corporate culture. The McKinsey report says we need to enable women’s participation, engage men, and build strong pipelines of women leaders. We need career-development plans, flexible working policies, equal opportunities, mentorship and leadership programs, and to showcase the achievements of women.

Women are innovating the corporate landscape when increased participation and gender balanced, inclusive workplaces are present. With versatile thinking, resilience, and excellent leadership qualities, women are significant players on the corporate field and will continue to make a positive impact on the economy. By eliminating negative self-talk, guilt and limiting beliefs, and by supporting one another we can embrace our inherent power as women and achieve greater success.

We would love to hear your thoughts