Gender diversity at Workplace

Why Is Gender Diversity In Leadership Important?

Reading Time: 6 minutes

The question may seem pretty basic and very intuitive but really, how many people really understand why it is very important to have gender representation at all levels of workplace?

Let’s start with clarifying what gender diversity means.

Wikipedia defines this as “Equitable or fair representation between genders. It most commonly refers to an equitable ratio of men and women, but may also include non-binary gender categories.” Gender diversity is about better representation of all the genders at all levels of governance.

“A study from the US that examined the performance of 1,500 companies over 15 years showed that at an average level of innovation intensity, the presence of a woman in top management amounts to creating extra market value for each firm of about US $44 million (1).

Widely available research suggests that firms with greater diversity and more women representation at senior levels, do better on the stock markets and offer greater returns in comparison to less diverse workplaces. This is ascribed to a variety of factors such as greater balance in workplace idea generation, speed of new products and innovations, prudent fiscal decision making.

But what are the drivers for the economic benefits emerging from women in leadership and generally diverse organisations?

  1. Heterogenous workforce – A diverse workforce tends to produce a more holistic analysis of the issues an organisation faces and spurs greater effort and motivation, leading to improved decision-making. A diversified group works harder to find logical and innovative solutions to problems than a non-diverse group. Think about this. If a team or office had only males, how much insight would the office miss on what drives 50% of the population and makes 85% of all retail decisions (5, 9, 12)?
  2. Building a workplace that is attractive to join and to stay with – research finds correlation between current workplace diversity and female presence in leadership with how attractive a firm may be to prospective employees. It also suggests that employees prefer staying at places they consider fair (equal opportunities to learn and grow for all) (6)
  3. Financial freedom – our generation has had arguably the greatest amount of discretionary money. That means money to spend on wants rather than on needs. As we expand the working population to include women, we add more and more financial muscle to the female gender, who then has greater spending powers, which then reinforces the economy (5, 12)
  4. Confidence – as more women join and remain in the working world, they become more confident about themselves. They make better financial decisions, make their own investment and saving decisions. They raise children who are used to seeing both genders manage and share work and home responsibilities which helps in building gender tolerance in future generations

In Australia, Goldman Sachs & JBWere calculated that the rise in female employment since 1974 has boosted Australian economic activity by 22% and that a 6% increase in the female participation rate would boost the level of GDP by 11% (5).

So here we are, with multiple reasons to hire and retain women in the workforce. Then why is it that we continue to have very low representation at middle to senior levels? And could the current business environment’s romance with gender diversity actually be about the famed glass ceiling and helping women break it? And why now?

Let’s tackle each question at a time starting with the third one.

Why All This Hue And Cry Now?

Women represent more than 50 per cent of the population worldwide, but only 45.3 per cent of women had a job in 2018.1 Women accounted for less than 4 per cent of board chairs across nearly 7,000 companies in 44 countries in 2017.

Data and reports on the economic value of women in the workforce have been around for a while. Forbes magazine, Catalyst, Mckinsey Global Institute have run extensive studies to understand the benefits that come from having women in boardrooms and leadership positions. Governments are modifying sexual harassment laws and anti-gender discrimination laws, and Companies Act to make them gender friendly. They are also acting on critical issues such as maternity leave, child care availability and funding (13, 14). The technological advances in connectivity and communications mean women could, if necessary, work from home for longer durations at times of need thereby removing a potential reason for quitting. If you put them all together, it feels like it is an idea whose time has come.

The ILO has published a research paper on Empowering Women at Work (1) that explores 5 key areas where companies can contribute :

  • Achievement of equal pay for work of equal value
  • Prevention and elimination of violence and harassment
  • Creating a harmonious work-life balance for both women and men
  • Equal representation of women in business and management roles
  • Investment in a future of work that works for women

What Are Organisations Doing?

Proportion of women directors between 2013 and 2016 has increased by 180 percent – KPMG in India’s Board Leadership Center and Women Corporate Directors India (WCD) (14)

So, what Are organisations Doing to enable women so that the glass ceiling is shattered once and for all?

Multiple things are being attempted to enable women to join, stay, and climb the ladder at workplaces. They could include enlightened work from home policies that enable women to continue working during new motherhood period. Tying up with child care centres so that women could be close to their children during the first 5 or 6 years of a child’s life reducing dependencies on family support. Specialized mentoring for women to climb higher. Enforcing gender quotas for each hiring requisition which automatically increases chances of women being hired. Working with recruitment firms so that gender neutral CVs are requested for and received during hiring. Holding women networking sessions that share and exchange tips and lessons for women at various levels (4).

How Can Policy Action Help This Further?

The ILO MNE promotes synergies between government and business policies to promote gender equality in the world of work, through its Multinational Enterprises (MNE) Declaration. It is the only global instrument in this area that has been elaborated and adopted by governments, employers and workers from around the world. It was adopted close to 40 years ago and most recently updated in 2017.

In 2011, the UN Human Rights Council unanimously endorsed the United Nations Guiding Principles on Business and Human Rights (UNGPs), which implement the UN “Protect, Respect and Remedy Framework”. They provide global guidance to prevent, mitigate and remediate business-related adverse human rights impacts.16 The Council also established the UN Working Group on Business and Human Rights and the UN Forum on Business and Human Rights to disseminate examples of good practices, assist in capacity-building, make on-site visits, and maintain a consistent multilateral dialogue that is then reported to the United Nations General Assembly.

The SDG 2030 framework focuses on initiatives to pull large populations out of poverty via state and private action. Gender equality and women’s empowerment are integral to the achievement of all 17 Goals. The SDGs “seek to realize the human rights of all and to achieve gender equality and the empowerment of all women and girls”.

In 2010, the UN published the 7 Women Empowerment Principles that have been endorsed by the United Nations General Assembly, the G20 and the G7. The 7 principles are

  • Establishment of high level corporate leadership for gender equality
  • Treating men and women fairly at work
  • Ensuring health, safety and well-being of all women and men at work
  • Promote education, training and professional development of women
  • Implement enterprise-development, supply-chain and marketing practices to empower women
  • Promote equality through community initiatives and advocacy
  • Measure and report goals and progress on gender equality  


Like everything else in life, this is a cycle and it needs reinforcement. As more and more women join and stay in the workforce, they become confident of their abilities and skills, they start taking risks and opportunities in their careers, something they didn’t do much before. They grow and develop skills essential to management and leadership which in turn increases the pool of experts available when senior positions become open. They network with an increasing pool of talented women building their own networks and support groups like the old fashioned old-boys-networks.

And the glass ceiling may truly become a thing of the past!


  7. – Retaining a diverse workforce: the impact of gender-focused human resource management – Muhammad Ali1,*, Isabel Metz2 and Carol T. Kulik3
5 1 vote
Article Rating
Notify of
Inline Feedbacks
View all comments