Women are better CEOs and here is where the women led market is headed in 2022

At a recent Shark Tank episode where Billionaire Mark Cuban and other highly successful investors join him to get pitched live by aspiring entrepreneurs, Mr. O’ Leary, one of the show leaders, declared that "Women make better CEOs. He elaborated further “All things being equal, given the choice between a woman and a man, I would pick the woman every time." He explained that in 75% of his investment he has been successful because these companies have women in C suite role. If we break it down further, we find out that 55% of the companies he has invested recently, have a women CEO. Most of these investments are a recent change of his investment strategy where he prioritizes women CEO as a criterion to select start up and mid-cap company in which to invest. He is making more money in companies that are women led. Pure and simple according to him women are better at running companies and if they are publicly traded their stocks are less volatile.

What do the statistic say?

Statistics support O'Leary's assessment and results. There have been numerous studies showing that women in leading roles assure better company performance, including a recent US and EU banking study that shows that companies with more than one woman on their boards have outperformed those with no women on their boards in the stock market.

Looking at pre-covid quantitative analysis performed by S&P Global Market Intelligence (see data below), the Russell 3000 companies list from year-end 2002 through May 31, 2019, suggests that those companies with female CFOs generated $1.8 trillion more in gross profit than their sector average. Companies with female CFOs also experienced bigger stock price returns relative to firms with male CFOs during the executives' first 24 months in the role.

According to Forbes, Women in corporate leadership roles, can leverage their superior empathy, emotionally intelligence, capital-efficiency, and collaboration. These skills are key differentiators particularly in down-turn markets like the current ones and can help companies reach higher performance across different sectors.

When exploring further the corporate landscape data on gender performance, we find that experienced female entrepreneurs, are also better at listening and connecting with the customer and with their staff. This results in better customer service, better employer engagement and higher staff retention. Women founders are more prudent in allocating capital and in forecasting financial performance resulting in more predictable stock performance as well as capital preservation. Also, women professional seem to be more at ease with multitasking. According to Professor Ken Robinson, this is due to the callosum nerves, a thick band of nerve fibers that connects the right and left hemisphere of the brain. It is much thicker in women.

Conclusion: Regardless of what the research says, having worked with over 1500 women CEOs across 15 countries since 2011, I can say that women are well equipped to outperform their male collogues. We fund this was true in almost all sector and regardless of the level of expertise. Having a greater proportion of women in executive positions is not just an Environmental Social and Governance (ESG) requirement, but a must have for all corporations as it lowers the cost of equity, it leads to stronger share-price performance, and it leads to faster client acquisitions. Whether you are a startup, a mid-cap, or a larger corporation, promoting women in leadership roles will facilitate your fund-raising, increase your profit while doing something good for society. My final advice to investors, follows Mr. O’ Leary’s strategy-invest in women led companies, and to corporations-promote women in leadership roles.