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I overheard a conversation last week at a cocktail reception. Two women were discussing the issue of corporate social responsibility (CSR) — and why gender equality doesn’t get as much attention as other issues. They were not talking about the extreme issues facing women globally – for example, laws preventing women from working or driving, sexual abuse, genital mutilation and poverty. They were talking about the issue of women in business leadership.
I think of social responsibility as focused on those who need assistance (women in third world countries) or issues that require complex collective action (protecting our environment). For me, gender diversity in leadership doesn’t fit such categories. Women aspiring to business leadership aren’t needy, except in the sense they can use help in eliminating unconscious gender bias and the resulting obstacles to reaching their potential. I see gender diversity less as a moral or social issue, and more as a business or economic issue. It is not just that women lose out by not reaching their potential. Businesses and the world miss out by failing to fully leverage women.
Several governments (e.g., Norway, France and Germany) have stepped in to regulate that corporate boards include a minimum percentage of women. In the U.S., companies file CSR reports, which include questions on women in board and leadership positions. Pressure to have more women on boards has increased for more than moral reasons. It has increased because gender diversity in business leadership is positively correlated with better governance, boardroom dialogue and decision-making — and ultimately financial results.
So if gender diversity in leadership does not fit neatly into CSR, what do the two have to do with one another? Apparently gender diversity in leadership can contribute to CSR efforts – and therefore to the world!
Catalyst and others have found that “gender-inclusive leadership” and CSR are linked. A 2010 Catalyst report concludes that, “Companies and society win when business leaders are gender diverse.” Another study shows that companies with female CEO’s (a pretty small sample) commit more resources to CSR.
Harvard Business Review recently reviewed a study showing that CEO’s with daughters score higher on CSR metrics. Professor Henrik Cronqvist, who conducted the research with a colleague, said about this correlation:
“Controlling for other factors, companies run by executives with female children rated higher on the measures of diversity, employee relations, and environmental stewardship tracked by the CSR research . . . .“
The author’s theory for the correlation was that
“The literature in economics, psychology, and sociology suggests that women tend to care more about the well-being of other people and of society than men do, and that female children can increase those sympathies in their parents.”
Men with daughters got the highest rating compared to the median in the category of “diversity.” (They scored 13.7% higher than the median and at least 6% higher in the other categories mentioned by Cronqvist.) This makes sense. In my experience, men with daughters become more aware of gender diversity issues. They want their own daughter to be able to reach their potential – at the C-level or board level if they choose. They don’t want their daughters to be subject to the unconscious bias and resulting obstacles that keep women from the top levels of business. So maybe this concern gets generalized into other categories. Hooray!
What are your thoughts on the inter-face of gender-diverse leadership and social responsibility?
