Small Biz Do Yourselves
a Favor by Hiring & Promoting Women
Yesterday, I came across a very salient quote by Linda McMahon, administrator of the
Small Business Administration. In her testimony before the US Senate Small
Business Committee on May 15, she observed quite appropriately that women
flourish more in an environment that has mentoring and counseling, which is why
women’s business centers are so important.
Linda McMahon,
administrator of the Small Business Administration, with Sen. Jim Risch (R-ID)
after her testimony before the Senator Small Business Committee.
McMahon said the advice and direction provided by the SBA’s
district staff across the country, along with its resource and lending
partners, is all part of a “very critical ecosystem” that benefits women in
business. Her use of the word “ecosystem” is fitting because it conjures up an
image of all inhabitants contributing to one another’s welfare. “Every day,
this collective effort helps entrepreneurs navigate the complexities of
business ownership,” she pointed out.
Small business ownership and growth are complicated
undertakings and require entrepreneurs to be skilled jugglers that can simultaneously
manage every facet of their companies’ activities. It stands to reason that an
astute business owner should assemble the most comprehensive, skilled team of
managers and employees possible. This group should include both skilled men and
women dispersed horizontally and vertically throughout the company.
Turning to the notion raised by McMahon, hiring and
promoting women offers your business comprehensive benefits that will illuminate
its presence and successes locally and globally. Such a business plan also
supports UN Sustainable Development Goal
#5 – Achieve Gender Equality and Empower All Women and Girls. Consequently,
by hiring and promoting women, your small business declares itself to be
sustainable and you should invest time and money in pursuing this endeavor.
The case for companies to act is compelling. It contributes
to your growth, drives your business and adds to your bottom line.
For example, in a recent survey of 366 companies,
consultancy McKinsey & Co. found that companies whose leadership roles were
most balanced between men and women were more likely to report financial
returns above their national industry median. This means that companies with
more balanced leadership do a better job recruiting and retaining talented
workers, reducing the costs associated with replacing top executives. They also
have stronger customer relations because management better reflects the
diversity of society, and they tend to make better decisions because a wider
array of viewpoints is considered.
Another report, titled “The CS Gender 3000: Women in
Senior Management,” shows that companies with more female directors and senior
executives tend to have higher returns and dividend payout ratios. The report found
the shares of companies with at least one female director outperformed those of
firms led by all-male boards by about 3.7% in 2005 and 2013. The return on
equity of companies with at least one female director stood at 14.1% during the
period, beating the 11.2% for those with all-male boards. It jumped to 14.7%
for firms with more than 15 per cent women in the top management. Companies
with at least one female director also paid more dividends in 2005-13, with the
average payment ratio standing at 38%, compared with 32% for companies with
only men on their boards.
Sodexo, a leading provider of integrated food, facilities
management and other services, which has 419,000 employees in 80 countries, after
a company-wide study found that units with equal numbers of men and women in
management roles delivered more profits more consistently than those dominated
by men.
Venture capital firm First Round Capital evaluated more than
300 companies and 600 founders and found that their higher performing
investments tend to have at least one female founder, and companies with a
female founder performed 63% better than those with all-male founding teams.
Why does the presence of women in a company contribute to
its success? One reason cites a textbook example of the differences between men
and women: Men see business barriers as obstacles, while women often see them
as opportunities. Women act on the basis of opportunities. Their unique
strengths include blending purpose and profit to the betterment of all and they
are creating competitive advantage by incorporating cause marketing – a sustainable
issue. By linking their brand and marketing to a cause, they can boost customer
awareness, drive sales, polish their reputation, give back to the community and
lower marketing costs, all at the same time.
In today’s marketplace, the affluent demographic cohort
known as Millennials relates to this type of marketing and puts its money where
its beliefs are.
Successful women are more likely than successful men to own
a business so they can pursue a personal passion and to make a positive impact
on the world – like fostering the 17 SDGs, according to 2013 U.S. Trust
Insights on Wealth and Worth. Seventy percent of the women and only 62% of the
men are committed to increasing the level of their sustainable activities,
according to Cox Conserves, a national sustainability program run by Cox
Communications and Media.
There is a lot more persuasive evidence that demonstrates
that gender equity is not just politically correct window-dressing, but good
business. But there are pitfalls. Companies are trying to increase the number
of women in executive positions, yet many are struggling to do so because they’ve
failed to adapt workplace conditions to ensure that qualified women do not drop
off the corporate ladder, surveys have shown.
Echoing the Linda McMahon’s mentoring suggestion, ExxonMobil Foundation has found that
educating women on their career paths boosts their abilities to successfully assume
responsible positions. While women’s entrepreneurship is on the rise globally,
many women lack the confidence, access to capital, skills and networks to take
their small businesses to the next level. To resolve this, the foundation contributed
to launching Road to Women’s Business
Growth as a collaborative venture designed to build the business skills and
financial literacy of women entrepreneurs.
The project uses a novel “blended learning” approach, which
combines in-class training with a unique, custom-built online learning tool.
The in-class training enables women to benefit from networking opportunities
and peer-to-peer learning, while the e-modules are accessible via tablets,
allowing women to learn at their own pace and convenience.
Indeed, opening your door to women employees may be as
simple as doing just that. However, share your views with your company. You,
the business owner, may have a progressive disposition about diversity,
inclusion, equal rights for women and gender equality, but your managers and
staff may not. To nip possible disruptive dissension in the bud, owners must begin
by openly addressing this issue with all of the senior and subordinate employees,
explaining why you’re launching this program and what will be the benefits for
the company and all of the employees.
As for SDG #5, it does not merely pertain to hyping equal
rights for women and then disregarding what to do once you’ve assumed that status.
Since you support SDG #5, your task is to ensure that women
fully participate and are equally represented in all levels of national
leadership and decision-making in economic, political and social aspects of
life. A major reason why women are still lagging behind socially and
economically is because they lack political, economic, social and civil support
for their plans and goals. Largely due to educational qualification barriers,
women representative positions are either given to under-qualified women or
even men who have little or no knowledge of what exactly the challenges faced
by women are.
You’ve also committed to formulate and execute social
reforms to grant women equal ability to access economic resources, financial
services, and ownership and control of properties such as lands and homes, in
accordance with respective national laws.
None of this means that you have to turn your company upside
down. It means that you run your business in a responsible, inclusive manner
with genuinely equal opportunities for every employee.
And you will reap the benefits. As I have written before, businesses
that participate in the Sustainable Development Goals stand to experience an
unbelievable windfall. The SDGs have the potential to unleash innovation,
economic growth and development at an unprecedented scale and could be worth at
least $12 trillion a year in market opportunities and generate up to 380
million new jobs by 2030. The SDGs hold great possibilities for all businesses.
There are 17 of them. Pick just one.
Join the conversation in cyberspace about sustainability,
women’s empowerment and boosting your outreach. If you have examples, let me
know about it and I’ll help you spread the word about your success.
Check your calendars:
If you’ll be in New Jersey in the
next couple of weeks make plans to attend the Metro Women’s Leadership Summit at the Newark Airport Marriott
Hotel on Friday, June 1. The daylong agenda of top business speakers is headed
by New Jersey Lt. Gov. Sheila Oliver as
keynoter. The program should be quite extraordinary since it aims to focus on “redefining”
the corporate ladder rather than climbing it. Visit its website: http://www.metrowomensummit.com/
Scroll through my blog to read about more ways to boost your
outreach.
I’d also like to invite you to visit my Thought Leadership
website:
If you’re looking for advice on recruiting, company
handbooks and other human resources topics, I’d like to suggest to you this
interesting website:
