Sammar Essmat (IFC): Board balance between men and women improves decision making and performance

“Balance between the number of men and women in a board provides a positive impact on decision making and business performance,” said Sammar Essmat, gender and private sector specialist for Europe, Central Asia, Middle East and North Africa at International Finance Corporation (IFC), during a debate at World Bank Romania this Wednesday.

Men and women exhibit different leadership styles, according to a McKinsey analysis from 2003, which is perfectly applicable in the present, according Essmat. While women tend to focus more on people development and on role models, men have a more individualistic decision making and a control and corrective action style. The study also revealed that women and men apply equally intellectual stimulation and efficient communication, while women tend to use more their inspiration and the participative decision making.

“Therefore the argument is that if you have a higher representation of women in your leadership pool, you are actually benefiting from those very specific qualities that women leaders exhibit and this in turn has a contribution to the organization and business performance. Credit Suisse understood this and took a similar sample of companies, Fortune 500 companies, and made two samples of groups, one group of companies had boards only led by men and the other group of companies had at least one woman on the board. They compared the business results of the two groups and found out that the companies with at least one woman on the board exhibited better ROE, improved valuation, better risk management and higher income growth., ” adds Essmat.

Lucian Anghel, president of Bucharest Stock Exchange said “We currently have eight females on the board and this is not because we wanted to provide a gender equality, but because we believe that they were very solid and strong candidates.”

“I also think that financial education is important, especially among women, because the life expectancy is longer for them and they need to save more to compensate the public pension they will get after retiring, ” added Anghel.