More women in the boardroom is better: Study

(Fotolia)

(Fotolia)

QMI Agency

, Last Updated: 10:17 AM ET

If a company is stuck in the red, it might need a woman's touch.

A new study has found that companies with women on their boards of directors fair better than companies with all men at the helm.

Credit Suisse Research Institute's analysis of more than 2,400 companies found those with at least one woman on their board performed better in the stock market by an average of 26% over the past six years.

That's especially true during a rocky economic climate. Most of the difference between male boards and mixed-gender ones came after 2008, when the economy took a plunge.

"Evidence suggests that a bit more balance on the board brings with it a bit less volatility and a bit more balance through the cycle," the study's authors suggest.

Credit Suisse, a financial services company, posits seven explanations for its findings:

1. People, including investors, believe companies with women are better businesses.

2. Evidence suggests people work harder when there is gender diversity in the workplace.

3. Women make good leaders and mentors.

4. Hiring both men and women means having access to a larger talent pool.

5. Because women are often expected to make household spending decisions, they know what consumers want.

6. Evidence suggests that having more women on a board improves corporate governance.

7. Companies avoid bad decisions, because studies show businesswomen tend to be more risk-adverse than businessmen.

 


Videos

Photos