Diversity, it turns out, isn't just a buzzword.
A global study of almost 22,000 companies across 91 countries has found that organizations with more women in leadership roles tend to be more profitable. It's not a measly difference, either. The Peterson Institute for International Economics found that firms where at least 30 percent of "C-suite" executives are women add 1 percentage point to their net margin compared to those with male-only executive suites.
That amounts to a 15 percent boost to profitability for businesses with a more equal gender mix.
It's not only having a token woman at the top that makes a difference, however. Notably, firms with women CEOs weren't statistically more or less likely to outperform companies with male CEOs. While adding women to corporate boards did seem to lift results, the real gain came at the executive-suite level, the study found.
"The result of the impact of women on the C-suite, no matter how we tortured the data, we got the same result -- that it had a positive impact," said Marcus Noland, Peterson's executive vice president and director of studies. "There are probably benefits to having some functional diversity embodied in your leadership suite, and when you introduce women that is effectively what you are doing."
Corporations are lagging when it comes to adding women in leadership positions, with the research finding that women constitute just 14 percent of the 144,000 executives tracked by the study, and only 4.5 percent of the CEOs.
Theories abound about why women aren't getting a foothold on the corporate ladder's upper echelons to the same extent as their male cohorts, especially given the rising ranks of women graduating for college. In the U.S., the scales have tipped, with about one-third of women in the 20s having earned a bachelor's degree, compared with only one-quarter of men.
"Women represent at least half of graduates in social science, business and law in nearly all countries in the sample in both time periods, implying that education is not the main obstacle to leadership success. The logjam lies further downstream," the study noted.
Women are also just as ambitious as men, Noland said. The problems appear to arise later in a women's career, most notably if she starts a family. Discrimination against women in leadership roles can arrive in the form of "mommy track" jobs or unspoken beliefs that mothers can't commit to the job the same way as other workers.
"It appears discrimination is alive and well and has real impact," he said.
Debate over maternity leave has become heated in the U.S., which is the sole industrialized country without mandated paid maternity leave. Mandated maternity leave, however, isn't correlated with the share of women in leadership roles. Instead, the researchers found that paternity leave is strongly correlated with the number of women in corporate board seats.
The reason? Paternal leave helps shift the demands of child care more equitably between men and women, whereas often that burden falls mostly on the mother. By providing a way for men to share the duties and time-pressures of parenting, that allows women more flexibility in their careers.
The existence of paternal leave policies may also serve as a proxy for policies such as state support of child-care, which would also help expand gender equality, Noland noted. Progressive countries such as Norway and Sweden, for instance, provide several weeks (not days) of paternity leave. Workforce participation for women in both countries is much higher than in the U.S.
"Paternal leave does directly impact the results of what we are seeing," Noland said. "It makes the interruptions of women's careers associated with childbirth shorter and less traumatic."
What's the takeaway for corporations? At a minimum, companies should review their internal recruitment and promotion policies, Noland said. Some formal rules, such as mandating that female candidates must be interviewed along with male candidates for executive roles, may also help.
"Seeing women at the top may encourage other women to pursue those goals," he said. "Once you get women in these positions, they point out things that their male counterparts don't see."