Fortune 500 companies with the highest representation of women board directors attained significantly higher financial performance, on average, than those with the lowest representation of women board directors, according to non-profit Catalyst’s most recent report, The Bottom Line: Corporate Performance and Women’s Representation on Boards. In addition, the report points out, on average, notably stronger-than-average performance at companies with three or more women board directors.

The report found higher financial performance for companies with higher representation of women board directors in three important measures:

Return on Equity: On average, companies with the highest percentages of women board directors outperformed those with the least by 53 percent.

Return on Sales: On average, companies with the highest percentages of women board directors outperformed those with the least by 42 percent.

Return on Invested Capital: On average, companies with the highest percentages of women board directors outperformed those with the least by 66 percent.

The correlation between gender diversity on boards and corporate performance is found across industries—from consumer discretionary to information technology.

About Catalyst
Founded in 1962, Catalyst is the leading nonprofit corporate membership research and advisory organization working globally with businesses and the professions to build inclusive environments and expand opportunities for women and business. With offices in New York, San Jose, Toronto, and Zug, and the support and confidence of more than 340 leading corporations, firms, business schools, and associations, Catalyst is connected to business and its changing needs and is the premier resource for information and data about women in the workplace. In addition, Catalyst honors exemplary business initiatives that promote women’s leadership with the annual Catalyst Award.

Learn more:

The Bottom Line: Corporate Performance and Women’s Representation on Boards
Catalyst
October 2007