Today it was announced that Alison Rose will become the first woman to lead one of the UK’s top banks – the Royal Bank of Scotland. Her appointment makes the Royal Bank of Scotland the only FTSE100 company to have women in both its top two executive positions as Katie Murray, as of last year, is their Chief Financial Officer.
Alison’s appointment comes as new research into the benefits of having gender diversity on boards has found that the insolvency rate is 49% higher for businesses with an all male board than mixed boards. This isn’t the first time that financial rewards have been attributed to greater diversity.
Research by Morgan Stanley found that companies who took a more holistic approach towards gender diversity outperformed their less diverse peers by 2.8% per annum over the past eight years. Additionally, statistics by McKinsey found that companies in the top quartile for racial and ethnic diversity are 35% more likely to have financial returns above their respective national industry medians.
Given these statistics and the breadth of evidence that supports the relationship between increased diversity at board level and business success, Equality Group Founder, Hephzi Pemberton – Founder of Equality Group – is of the following opinion: “Diversity and equal opportunities are no longer buzzwords or optional extras in the workplace: employers can’t afford to ignore them because they affect the bottom line. It is great that the Royal Bank of Scotland is setting a precedence for all other institutions as to the value of their female staff and their contribution to the sector.
“Study after study has shown that diverse teams improve financial results with the higher the percentage of women in management positions, the greater the returns. This is because more diverse companies can attract, develop and retain a broader talent pool and because of this, are able to serve niche markets with a better understanding of their customers.
“It also allows companies to tailor their approach to every facet of society, improves their image, staff satisfaction and net income. Ultimately, diverse businesses do better and all companies should strive for diversity, not simply to meet implemented targets, but to reap the rewards that increased diversity will enable.”