The FINANCIAL — A new report from IFC, a member of the World Bank Group, and Jordan’s Institute of Directors (JIOD) finds that by elevating more women to senior management positions, local companies could dramatically improve their performance.
Although women represent 16 percent of the labor force in Jordan, they hold only 6 percent of board positions, according to the report, Impact of Gender Diversity on the Economic Performance of Companies. The study, which examined the boards of nearly 1,200 publicly listed and private shareholding companies, found that those with a strong female presence on their boards tended to outperform those without.
“There is a clear business case for a balanced board,” says Laith Al Qasem, JIOD Chairman. “Gender diversity brings fresh perspectives and new ideas into the boardroom in turn leads to better decision making. Gender diversity is increasingly important if Jordanian companies are to prosper in a competitive global marketplace.”
The report, found here, highlights the impact of gender diversity on the economic performance of companies in Jordan and discusses the challenges that face women in reaching decision-making positions. It also includes recommendations for ways to overcome those challenges.
“Improving corporate governance can help firms grow, improve performance, manage risks, and attract investors,” said Ahmed Attiga, IFC Country Manager in Jordan. “To be truly effective, a board requires a diversity of gender, skills, cultures, and views to make smart decisions with lasting impact“
The report found that companies with women in the boardroom got a better return on assets (ROA) and return on equity than firms without female leaders. In 2012, for example, the average ROA for companies with at least one woman in the boardroom was 3.03 – triple the average for firms with no female presence.
The report is part of a wider IFC effort to support private sector development in Jordan and boost economic growth. It is supported by the Canadian Department of Foreign Affairs, Trade and Development, the Danish International Development Agency, Japan, Switzerland’s State Secretariat for Economic Affairs and UKaid.