The Confidence Factor for Women: Hiring More Women Increases “Profit”
OpEd: The global financial impact of increasing revenue by hiring more women, who continue to remain under-valued. Are companies proud of their “cheap labor” policies toward women?
I was sitting in my office and came across an encouraging article via Quartz Media that states, “Huge study finds that companies with more women leaders are more profitable.” As a committed feminist and advocate for the advancement of c-level women, the title was encouraging to finally read a headline that showed how valuable we are in the market.
However, after careful thought and weighing the facts, it makes perfect sense that companies can increase profits as a result of hiring more women. The simple explanation is women are compensated much less than men, which can save the average company (+/-) 20% per hire in salaries. When you think about it closely, compensation is an expenditure, and does play a role in the NOI. If you can hire more highly qualified women, who will earn between 57–77% of the average comparable salary of their male colleagues, of which race, ethnicity and age play an important role in the percentage, then of course, it makes sense to hire more women.
Although I speak with a bit of sarcasm, the fact remains that compensation inequity due to gender disparity is a factor that is not viewed as a part of the narrative of why companies increase revenue. However, companies with more women in leadership improve productivity. But there is still more work to do to add more women leaders to C-Suite level roles. If we can close the ever-widening salary gap, and focus on productivity and fairness, revenue will continue to rise as well as new perspectives on creating more room for qualified talent, which is not chosen based on unconscious biases.
Women continue to enter leadership roles with a high level of optimism and the consideration of fairness. In addition, senior level women continue to contribute superior performance as they most notably increase their skills with further training as they continue to accelerate, which provides corporations with a highly-qualified, diverse talent pool of ambitious women, who are committed to the corporate culture, yet under-valued for their efforts.
I believe that companies should continue to perform and excel financially, however, we must include that compensation argument to the narrative about why companies with more women are increasing revenue. For every woman, who is not fairly compensated for equal value, there is money left on the table which helps more companies to prosper without valuing the full talent pool. As I have been preaching for years about the importance of negotiating, it has become the basis of my professional rebuttal to the issue of equity in the market.
“Women may not realize that many companies set aside money with the expectation that employees will ask for better compensation packages… Yet only 30% of women bother to negotiate at all,” according to Equal Pay Negotiations. Women need to become members of negotiation incubators and training, which will teach them how to increase market share and value, so there is equal consideration for equal work. On average, upwards of $2 million of lost revenue remains unclaimed each year that women ignore the importance in engaging in evaluation hearings to discuss equity, improved skills and performance.
There is a value for your skill. Do not let corporations continue to celebrate their quarterly earnings, with the win-fall of the revenue they “save” from disproportionately under-valuing the contribution of women leaders.
Carol Sankar is a high level business consultant and the founder of The Confidence Factor for Women in Leadership, which is a global executive leadership firm focused on diversity and inclusion initiatives for high level women. Carol has been featured at TEDx, The Steve Harvey Show, Bounce TV, Inroads, SHRM, Huffington Post, Entrepreneur Magazine, Forbes and more. For more details, visit www.carolsankar.com