By Jimena Fernández Cortina, independent advisor of Aleatica
It is time to push for the inclusion of more women on boards, which will spur companies’ growth and is in line with ESG (Environmental, Social, and Governance) principles.
Without actions to promote the presence of women on the boards of directors of public companies, it is estimated that parity between men and women on these bodies will not be reached until 2088. We cannot afford to wait so long as the competitiveness of our businesses and our country depend directly on bringing in women’s perspective in order to have a comprehensive vision. It is time to push for the inclusion of more women on boards to create greater growth for businesses and in alignment with ESG (Environmental, Social, and Governance) goals and principles.
Today in Mexico, only 10% of the 157 publicly traded companies have female board members, presenting us with an incredible opportunity to generate greater innovation and competitiveness within companies and for the country, starting from these boards. The World Bank indicates that, if there were greater gender equity in the workplace, the country’s per capita income would be 22% higher.
Inclusion is not only a factor of social responsibility, but also a business case. Companies that have three or more women on their boards show a 10% higher ROE (return on equity) than those that do not, and companies that have 30% or more women on their boards have 16% greater operating margin and report a return on capital that is 26% higher.
It is important to clarify that diversity means accepting the participation of women in organizations, while inclusion means fostering their participation as a proactive competitive strategy. Several studies emphasize the importance of having at least two or three women on boards in order to strengthen a culture of inclusion both at the core of the board as well as in the company. Having just one woman in order to comply with the perception of diversity does not contribute to the goal of generating cultural change.
To strengthen business strategies by means of an inclusive vision, I highlight three approaches that businesses should keep in mind. First, they can assess where the company stands in terms of diversity and inclusion parameters (for example, the number of women in management positions, the pipeline of women in middle management, pay equity, flexible policies for both genders, etc.) and starting there, create internal policies and specific goals to set metrics and measure progress.
Second, businesses must make sure to identify the women who stand out for their skills, abilities, and talent in order to place them in upper management positions. We face the challenge that, when trying to include more women on boards, the first selection criterion is the potential board member’s previous experience. Without a doubt, it is necessary to change the mindset and create new opportunities that will allow women to accumulate experience in the area and to broaden what are considered to be the requirements for participation.
Finally, the headhunters also play a key role in this transformation because when they look for new board members, they must expand the search to more varied profiles. Today more than ever, boards need professionals with different points of view and skills that go far beyond financial knowledge in order to spot and manage the risks that companies face globally.
The economic empowerment of women is a catalyst of business success. The ever greater inclusion of women on boards of directors is something that is talked about in public forums in Mexico, but it is time to take the next step and take proactive actions. To let more than sixty years pass to make progress towards gender parity on boards is the same as leaving money on the table, not smart. It is time to embrace inclusion as a business strategy.
https://www.forbes.com.mx/inclusion-en-los-consejos-un-pendiente-que-implica-oportunidad/
