Companies with women on their boards performed better in challenging markets than those with all-male boards in a study suggesting that mixing genders may temper risky investment moves and increase return on equity.
Shares of companies with a market capitalization of more than $10 billion and with female board members outperformed comparable businesses with all-male boards by 26 percent worldwide over a period of six years, according to a report by the Credit Suisse Research Institute, created in 2008 to analyze trends expected to affect global markets.
The number of women in boardrooms has increased since the end of 2005 as countries such as Norway instituted quotas and companies including Facebook added female directors after drawing criticism for a lack of gender diversity. The research, which includes data from 2,360 companies, shows a greater correlation between stock performance and the presence of women on the board after the financial crisis started four years ago.
"Companies with women on boards really outperformed when the downturn came through in 2008," said Mary Curtis, director of thematic equity research at Credit Suisse in Johannesburg and an author of the report. "Stocks of companies with women on boards tend to be a little more risk averse and have on average a little less debt, which seems to be one of the key reasons why they've outperformed so strongly in this particular period."
Net income growth for companies with women on their boards has averaged 14 percent over the past six years, compared with 10 percent for those with no female director, according to the Credit Suisse study.
Larger companies have a higher proportion of women on their boards, as well as those in the health care industry — 73 percent have at least one female director — and industries close to consumers, the study shows.
The materials and information-technology sectors have the highest percentage of male-only boards, both at just over 52 percent, according the report.
The group 2020 Women on Boards, which is pushing for 20 percent female directors by 2020, has identified more than 200 companies that lack a single woman on their board.
In the United States, 36 percent of companies still have no women on their boards of directors, according to a report by researcher GMI Ratings on gender diversity released Wednesday. The average corporate board has about nine members.
"Multiple academic studies have concluded that diverse corporate boards exercise more diligent oversight," Michelle Lamb, author the study, said in a report. "They have better attendance records than homogeneous boards, and they invest more effort in auditing when the complexity of the business warrants heightened scrutiny."