The Business Case for Women Leaders: Meta-Analysis, Research Critique, and Path Forward

Abstract

Since the 1990s, a growing body of research has sought to quantify the relationship between women's representation in leadership positions and organizational financial performance. Commonly known as the "business case" for women's leadership, the idea is that having more women leaders is good for business. Through meta-analysis (k = 78, n = 117,639 organizations) of the direct effects of women's representation in leadership (as CEOs, on top management teams, and on boards of directors) on financial performance, and tests that proxy theoretical arguments for moderated relationships, we call attention to equivocal findings. Our results suggest women's leadership may affect firm performance in general and sales performance in particular. And women's leadership-overall and, specifically, the presence of a female Acknowledgments: This article was accepted under the editorship of Patrick M. Wright. The authors would like to acknowledge Eddy Ng's helpful comments on an earlier version of this manuscript and Marcus Butts' valuable advice on continuous moderator testing in meta-analysis. The conceptual ideas behind our research critique received a Best Paper in Track Award at the 2013 Equality, Diversity, and Inclusion Conference. This research was supported by a grant (No.

Reinvigorating Research on Gender in the Workplace Using a Positive Work and Organizations Perspective*

“…; Hoobler et al . ). Regardless, it is important that the criteria by which women's effectiveness as leaders are measured are useful and offer a fair picture of women's contributions.…”

“…A meta‐analysis of 78 studies by Hoobler et al . () revealed that in cultures which promoted progressive attitudes toward gender parity, leadership by women was more likely to positively influence financial performance (e.g. sales performance).…”

Impact of transformational leadership on business performance

“…There are several studies regarding how women's leadership can affect company's financial performance [24,25]. The findings show that female-led firms were slightly better than their male-led counterparts in transmitting market performance into financial performance.…”

The Problem of Gender Essentialism and its Implications for Women in Leadership

“…Unfortunately, the nature of essentializing itself, including what it means and how it happens, is rarely discussed in the literature on gender and leadership although it is a common theme in gender studies (Hoobler, Masterson, Nkomo, & Michel, ). Essentialism is the belief in an underlying, unchangeable essence that defines a person, category, or thing (Scholz, ).…”

“…Given that gender is most convincingly explained as a social construct, rather than an essentialist category, it is troubling that so much research on women and leadership continues to rely on essentialist categorizations of women to address the issues and challenges women face in the practice of leadership. In their meta‐analysis of research on the so‐called “business case for women leaders,” Hoobler et al, () critiqued precisely this nonnuanced view of gender as essentialist as one of the hindrances to research and theorizing on women's leadership. In the studies Hoobler et al identified, gender was equated to biological sex rather than “a system of relations, identity, and power” (p. 12), which influenced leadership behaviors of men and women.…”