A recent analysis by BoardEx explores the benefits of having executives and board members with diverse experiences and backgrounds. It examines how some S&P 500 companies diversify their boards, and best practices for identifying new talent to help steer your organisation.
Having a diversity of experience within a leadership team—both in terms of skill sets and demographics—helps organisations remain agile, innovative, and better at navigating risk management. A 12-year-long study conducted by AXA IM Rosenberg Equities found that U.S. companies with greater than 20% gender diversity on their boards have higher profitability in the future compared to organizations with lower diversity. The same study discovered that gender balance can also protect businesses from competitive pressures.
Two things may account for these findings: Not only do female board members bring a unique perspective by virtue of their identity, but they also have diverse professional experience, in part due to social trends. A study by Russell Reynolds Associates analysed women directors at Fortune 250 companies and found they came from a wide array of sectors.
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