How does the presence of women in management positions affect the economic development of the country?

Research indicates that the participation of women in senior positions has a positive impact on economic development. This is evidenced by the report of the American analytical corporation S&P Global, 2019, entitled “When women Lead, Firms Win”. According to the report, companies with female CEOs and CFOs achieved a 20% increase in share prices (in the case of female CEOs) and 8% higher share gains (in the case of female CFOs).

Lynn Taliento and Anu Madgawkar, of the McKinsey Global Institute, note that non-profit organizations where women hold leadership positions are more successful in achieving their goals. According to the researchers, there is a growing body of evidence that more women on boards and management positions have a positive impact on financial performance.

In another report from 2007, McKinsey, examining the impact of women in management positions in European companies, estimated that between 2005 and 2007, companies with more women on management teams saw share prices increase (by 17%). In addition, their (operating) profit was almost twice the average of their industry.

Comparative analysis - methodology

This article will examine the relationship between the total percentage of women in managerial positions in a given selected country and the wealth of that country (calculated in GDP per capita — data for 2022).

Adjusted analysis — Six countries will be analyzed: Israel, Germany, France, Egypt, Turkey and Algeria from the website: worldometers.info.

Information on the proportion of women in leadership positions, included in the analysis, comes from the UN report “FORECASTING WOMEN IN LEADERSHIP POSITIONS”. According to data for 2023, the proportion of women in management positions worldwide was around 24%.

Adjusted selection of countries

In the comparative analysis, contained in this article, the following countries will be compared:

- Israel - Egypt/Lebanon;

- Germany - Turkey;

- France - Algeria.

The above countries were selected based on various factors such as:

1. Approximate population — used in the case of a comparative analysis of Germany and Turkey. According to the World Bank, the population of Germany was about 83.8 million and Turkey - 85 million (data for 2022).
2. Historical linkages — applied to the comparative analysis of France and Algeria and Israel and Egypt.
3. The place, occupied by the Global Gender Inequality Index 2022, compiled by the portal “Our World in Data”. This indicator takes into account factors such as: reproductive health, empowerment and the labor market. This indicator operates on a scale in which “0" indicates that women and men achieve comparable results, while “1" indicates that one of the sexes achieves the worst possible results in each of the evaluated categories. This scale is applied uniformly in all countries analyzed.

According to the indicator, the countries selected for the analysis record the following results: Germany (0.071), France (0.084), Israel (0.092), Turkey (0.259), Egypt (0.389), Algeria (0.460).

Adjusted Benchmarking — Women in Management

Germany—Turkey According to UN data, in 2023, the proportion of women in managerial positions in Germany was about 31.1%, and in Turkey - about 13.8% (more than twice less).

France-Algeria According to UN data, in 2023, the proportion of women in managerial positions in France was about 32.3% and in Algeria - about 10.4% (more than three times less).

Israel-Egypt According to UN data, in 2023, the proportion of women in managerial positions in Israel was about 32.5% and in Egypt - about 7.6% (more than four times less).

Conclusions from the revised benchmarking

Countries such as Germany, France and Israel, which have a much higher proportion of women in leadership positions, even several times greater than Turkey, Algeria and Egypt, are characterized by higher levels of wealth, measured by nominal GDP per capita. Ranking of countries in terms of nominal GDP per capita:

• Germany is in 17th place.
• France is in 25th place,
• Israel is in 34th place.
• Turkey is in 50th place,
• Egypt is in 94th place,
• Algeria is ranked 102nd.

The ranking of countries in terms of nominal GDP per capita indicates how individual countries rank in the global ranking for the nominal value of gross domestic product (GDP) per capita. A higher ranking means a higher nominal GDP per capita, which usually indicates a country's greater wealth.

summary

The emancipation of women itself, expressed in increasing their participation in the labor force, does not always translate directly into the economic development of the country. An example is some developing countries where a high proportion of women in the labour market coexists with a low level of economic development.

On the other hand, the presence of women in leadership positions and in government can have a significant and positive impact on the economic development of the country. This impact can contribute to an increase in the wealth of society as a whole, which shows that gender equality at the highest levels of power and business is not only a matter of social justice, but also a strategic step towards economic development.

Sources:

whenwomenlead_.pdf (spglobal.com)

Power with purpose: How women's leadership boosts the economy and society | Devex

wcms_334882.pdf (ilo.org)

Gender Inequality Index, 2022 (ourworldindata.org)

Population, total - Germany | Data (worldbank.org)

Population, total -, Turkey | Data (worldbank.org)

forecasting-women-in-leadership-positions.pdf (unwomen.org)

GDP per capita (current US$) | Data (worldbank.org)

GDP per capita - Worldometer (worldometers.info)

Countries Ranked by Percentage of Workforce Who Are Women (qualtrics.com)