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Women on the supervisory board make companies more profitable

Women change the dynamics on supervisory boards and also have a positive impact on the entire company. This is the result of a current study by the University of Tübingen.

Companies benefit in different ways when women sit on supervisory boards. A study by the University of Tübingen found this out. If there is at least one woman on the supervisory board of a company, the attendance rate at the meetings is higher than if there are only men on the board. If two or more women belong to the supervisory board, a company also becomes more profitable.

The scientists justify the result with greater diversity: “Different perspectives on the supervisory board mean that more alternatives can be weighed up and better decisions can be made,” says Kerstin Pull from the Department of Economics, one of the authors of the study.

The study shows that companies miss opportunities if they only exceptionally appoint a woman to their management and control bodies instead of systematically developing women into such positions.

View from the outside particularly valuable

If there were several women on the supervisory board, they would be better recognized for their different perspectives and expertise, and the board would be able to make better-founded decisions. “So a ‘critical mass’ of women on the supervisory board must first be reached before a positive effect on the profitability of companies can be measured,” explains Pull.

The positive effect is only partly due to the higher attendance rate at the Supervisory Board meetings. Another reason could be that women are more often recruited from outside into a supervisory board and were not previously on the board of this company. Supervisory boards should control the board of directors. This function is easier to fulfill with an outside perspective,” says Pull.

proportion of women has increased significantly

According to the information provided, the authors examined listed companies in Germany that report on participation rates in supervisory board meetings. The researchers compared the data with the proportion of women on the supervisory boards and with the profitability of the companies. The authors also conducted interviews with 17 supervisory board members.

Since the introduction of the women’s quota in codetermined, listed German companies at the beginning of 2016, the proportion of women on DAX supervisory boards has risen from 30.2 percent to 37.3 percent by the end of 2022. In 2023, for the first time, more women were appointed to DAX supervisory boards than men. The proportion of women on the executive boards of DAX companies has also risen sharply, from just 2.2 percent in 2010 to 21.8 percent in 2022.

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