Gender diversity is vital for business success in an environment of increasing uncertainty, with small and medium enterprises (SMEs) able to benefit significantly from the complementary skills, different perspectives and ideas women bring.
This is according to Kgomotso Ramoenyane, executive general manager of human resources at South African risk finance firm Business Partners.
The recent Grant Thornton “Women in business: New perspectives on risk and reward” report found only 28 per cent of senior management roles in South Africa are held by women. While this is up from 23 per cent in 2016, it is still considerably lower than regions like Eastern Europe, where 38 per cent of senior positions are held by women.
Ramoenyane says South African businesses should not get distracted by comparisons, but rather focus on understanding the significant value a business derives from increasing gender diversity.
“Women often have complementary skills to those of men, creating a potent skill mix across teams. Gender diverse teams also have access to a wider network and greater appeal across diverse markets and stakeholders. Most importantly, however, are the fresh perspectives women bring to the decision-making process,” she said.
This view is reflected in the Grant Thornton report, which highlights how men and women perceive and respond to risk differently. Assessing and managing risk, done through identifying, evaluating and managing uncertainty, is critical for all businesses. The different ways the genders approach risk strengthens a business’s ability to develop effective risk strategies, which is critical in times of uncertainty.
“The high levels of unpredictability and constant change which are defining features of the current business environment mean effective risk management is a strategic imperative. Homogenous group tend to display groupthink traits, which can lead to blind action. Gender diverse teams can overcome biases and help cultivate fresh innovative ideas and approaches to sustain business growth,” said Ramoenyane.
A 2015 McKinsey study, “Diversity Matters”, offers quantifiable evidence of how gender diversity translates into improved business performance. The study found companies in the top quartile for gender diversity were 15 per cent more likely to have financial returns above their respective national industry medians.
Ramoenyane points out that entrepreneurship is one of the critical drivers for the inclusive economic growth South Africa so urgently needs. All businesses, including SMEs, can help drive this growth by actively supporting female entrepreneurship.
“Female entrepreneurs face greater challenges than their male counterparts, with fewer business-orientated networks, barriers in accessing finance and limited availability of role models and mentors,” she said.
Her point is underscored by the Ernest and Young 2017 Business Outlook Survey, which reported 57 per cent of women founders said that their own drive to succeed was the biggest influence in getting them to where they are today. The survey also found that 68 per cent of women entrepreneurs used their personal savings to initially finance their business.
“Businesses can help women to address these challenges by nurturing female entrepreneurial talent at a young age and reinforcing that the business environment needs them. This could include collaboration with tertiary educational institutions to facilitate internships and placements programmes to support new female entrepreneurs,” Ramoenyane said.
She suggests that SMEs competing for scarce skills in a limited talent pool should actively reach out to women and create an employment environment which facilitates career development and growth, a good work-life balance and greater flexibility – aspects that are important to female employees.
“Increasing the numbers of women in business and paving the way for female entrepreneurs is far more than just ‘ticking the right boxes’. A gender diverse team makes good business sense and will help businesses to navigate a sea of risks in these tumultuous times,” Ramoenyane said.