Family businesses are more likely to appoint female leaders as they believe in the power of women on top, research by EY shows. Seven in ten businesses are considering a woman as their next CEO, with especially businesses in Germany and Spain prone to choose a female successor. According to EY, as family businesses are the anchors of the world economy, they can positively influence the diversity issue worldwide.
In its recently released ‘Women in leadership – The family business advantage’, professional services firm EY researches the role of female leaders in family businesses. The report is based on the 25 of the largest family businesses in each of the top 21 global markets.*
The research shows that family businesses are far more prone to putting women in leadership positions than non-family businesses, with 70% of the surveyed businesses considering a female as their next CEO – of which 30% are strongly considering this. Of the five women these businesses have on average in the C-suite, four are being prepared for top leadership roles. In addition, more than half (55%) have at least one woman on their board.
In non-family businesses, the percentage of women in leadership roles is much lower. While 22% of the management team in family businesses are women, in other businesses this is 12.9%, with only 3.9% of CEOs being female. Moreover, the worldwide average of women on boards is 12.7%, compared to the 16% in family businesses.
Women in developed countries are most likely to land leadership roles than their female counterparts in emerging economies, with on average 5.5 women in the C-suite in developed economies compared to 3.5 in emerging. Six in ten (60%) of family businesses in developed countries have at least one female on their board, with 10% stating that at least half of their board members are women. In emerging economies, almost half (49%) has at least one woman on their board.
Family businesses in Germany and Spain are most likely to appoint a female CEO, followed by Turkey, India and Indonesia. Businesses in the Gulf Cooperation Council countries, South Korea and Canada are the least likely to appointing women.
The power of family businesses
According to EY, family businesses, that create an estimated 70%–90% of the global GDP and 50%–80% of jobs in the majority of countries worldwide, can positively influence the diversity issue. “Family businesses may offer a path forward for all businesses seeking to achieve gender parity within their leadership ranks,” comments Carrie Hall, EY Americas Family Business Leader.
“Some of the largest, longest-lasting family businesses in the world are moving women farther and faster than their non-family counterparts. These businesses are the giants of the world economy, employing vast numbers of people, dominating industries, and impacting local and global economies. How they operate when it comes to valuing women leaders shows a different, more enduring and sustainable path forward for business and for the world economy as a whole,” concludes Peter Englisch, EY Global and EMEIA Family Business Leader.
* These markets are: Australia, Belgium, Brazil, Canada, China, France, Germany, the Gulf Cooperation Council countries (Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates), India, Indonesia, Italy, Japan, Mexico, the Netherlands, Russia, South Korea, Spain, Switzerland, Turkey, the UK and the US.