However, it is important to note that while a number of studies link gender diversity to better company performance, strategic decision-making and improved company risk profiles, it remains difficult to establish a causal relationship. Still, several reports indicate that increased female participation in senior leadership seems to be a marker of better managed organizations.5
Which sectors are performing?
According to recent research from Morgan Stanley6, sectors with the highest average percentage of women in the workforce are financials, health-care, discretionary and staples. But the sectors rewarded the most by the market for gender diversity, as measured by annualized relative returns, are energy, technology, material, financials, utilities and health-care.
On the face of it, the financial sector is the most gender diverse – it has a 50/50 split of male/female employees7.
However, at an executive level, the sector ranks close to average for empowerment and pay parity. The technology sector on the other hand ranks poorly on gender representation even though it's a new and growing sector8.
Interestingly though, companies within the sector tend to include a higher number of women in the C-suite and display better equality in pay relative to other sectors. High gender diverse tech firms also generate, on average, a 5.4% annualized relative return versus low gender diverse tech firms (the same metric averaged 1-2% across all sectors).
Which sectors are committing?
According to the latest Equileap report9, the top three sectors were communications, where 32% of those companies surveyed reached the Top 200 of Equileap's ranking, financials (27%) and utilities (21%).
For investors looking for potential opportunities, these findings could be a useful starting point in terms of thinking about gender as a potential marker of better performance.