Companies with more female senior managers perform better, with stock-price returns sometimes more than double that of less diverse companies, the latest update to a key Credit Suisse report confirmed.
"We find clear evidence that companies with a higher participation of women in decision-making roles continue to generate higher returns on equity, while running more conservative balance sheets," Credit Suisse's chairman Urs Rohner, and Iris Bohnet, a public policy professor at Harvard University and Credit Suisse board member, said in the report.
"In fact, where women account for the majority in the top management, the businesses show superior sales growth, high cash flow returns on investments and lower leverage."
The report, which surveyed almost 3,400 companies across all industries and regions, was an update on a study the Swiss bank conducted in 2014.
The authors found that the market put a 19 percent premium on the price-to-book multiple of companies with a female CEO, with those companies' return on equity averaging about 19 percent higher and dividend payouts about 9 percent higher than companies with a male CEO.
And the more senior management roles filled by women, the higher the stock price returns, the report said.
Shares of companies where women make up 25 percent of senior managers had annualized average stock returns of 22.8 percent over five years, while those with women in more than 33 percent of senior management roles had a 25.6 percent average annualized return, the study found.
Companies where more than half of senior managers were women posted an average annualized return of 28.7 percent, the report found.
That compared with an 11.7 percent return on the MSCI All Country World Index over the same period, the report said.
The study created equal-weighted indexes over the 2013-16 period, comprising 1,116 companies with more than 15 percent female top management, 631 with more than 25 percent, 317 with more than 33 percent and 61 with more than 50 percent.
Based on that index, the study found that from the end of 2013 to mid-2016, companies with women in 25 percent of senior management roles outperformed by 2.8 percent on a compound annual growth rate (CAGR) basis, compared with companies that had fewer than 15 percent female participation or all-male teams.