SYDNEY – An analysis of Australian businesses based on the gender composition of their boards suggests that those with board members from only one gender were not very likely to survive the economic crisis brought about by the covid-19 pandemic.
The study which was published last week was conducted by the ESG directory Purpose Bureau. It examined the failure rate of almost 1 million Australian businesses and their performance over the last one year. In the study, failure was defined as the deregistration of the businesses in the calendar year 2021 which were running for at least twelve months before the date of deregistration.
The big revelation from the study was that the businesses led by a single-gender were 37% more likely to fail as compared to one with people from both genders on their board. The difference between the failure rate among businesses with single-gender and mixed gender boards was the highest for education and training related businesses where it was 78%. At 29%, this difference was the lowest for the wholesale trade industry.
“This preliminary research, conducted over a very large cohort of Australian businesses, clearly suggests that gender diversity in leadership leads to better business outcomes,” said Nick Camper, the CEO of Purpose Bureau. He acknowledged that the research requires further analysis to fully understand the dynamics at play, but it’s evidence that Australian businesses benefit greatly from a diversity of views and experience at the leadership level.
The study conducted a detailed analysis of the gender composition of the boards across various industries as well. The lowest number of mixed gender boards (10%) were found to be in the public administration and safety domain which has 78% all-male and 12% all-female boards. At 22%, agriculture, forestry and fishing had the highest number of mixed gender boards.
The number of all-male and all-female boards in this industry were 63% and 15% respectively. Boards of mining and construction companies were pretty male dominated with 81% and 80% of the all-male boards. The highest number of all-female boards were in the healthcare and social care as well as the education and training sectors, with both having 29% companies having only women in the board.