Otago research finds solution to gender inequality in senior management
New Delhi: New research from the University of Otago has discovered a potential solution to the underrepresentation of women in senior management.
Associate Professor Helen Roberts and Dr Pallab Biswas, both from the Department of Accountancy and Finance, co-authored the study which found that more women on boards is associated with more women in senior management.
The research, published in the Journal of Business Ethics, discovered that while one or two women on a board is helpful in advancing women into senior management, three or more women directors is more beneficial.
Associate Professor Roberts says organisations have been experiencing mounting pressure to promote gender board diversity over the past two decades.
Since 2003, many governments have implemented gender quotas for corporate boards.
They decided to undertake the research to better understand the effect of having women on boards.
“In other words – are women directors ‘tokens’ appointed to meet board gender expectations or rulings by the regulatory body?”
Their research found the answer to that is ‘no’, she says.
“Our study suggests that providing equal opportunities for women to be appointed to board positions will support greater gender diversity in senior management roles and may assist in building a pipeline for future CEO and board appointments.”
Associate Professor Roberts says the research also found the association between women on boards and gender diversity in senior management is driven almost entirely by women in non-executive board positions.
That is likely a result of the independence that non-executive directors have compared to executive directors.
While the study examines the influence of women’s board representation in United Kingdom (UK) firms from 1999 to 2019, the results can be applied in other countries.
In New Zealand, promotion of greater board gender diversity has been ongoing, and in 2020 nearly one in five firms listed on the NZX, New Zealand’s Exchange had no women on the board of directors, she says.
Dr Biswas says their research supports greater proportions of non-executive women director appointments, which will benefit firms overall.
“There is already evidence that more women on board promotes greater gender equity across the organisation and more gender integrated workforces.
“Firms currently failing to diversify their board and workplace will benefit the most, as existing evidence shows that greater diversity improves firm performance,” he says.
Professor Larelle Chapple, from Queensland University of Technology, and Professor Kevin Stainback, from Purdue University, also co-authored the research.