BlackRock study finds companies with more women in workforce outperform rivals
Understanding the human capital aspect of corporate assets is increasingly relevant from an investment perspective, according to the report.
Firms with the most diverse workforces beat the return on assets of their country and industry group peers with the least-diverse by 1.6 percentage points, equating to average outperformance of 29% per year.
The research, titled ‘Lifting Global Growth by Investing in Women', looked at data from the past ten years and found greater workforce diversity can boost economic output by tapping into under-used talents and bringing different experiences and perspectives to the table.
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Understanding the human capital aspect of corporate assets is increasingly relevant from an investment perspective, according to the report.
«We expect disclosures to improve as human capital and diversity metrics become more established as drivers of financial performance and investment decisions,» it said.
Companies closest to sex parity across key roles, including revenue-producing, engineering and top-paying roles, have outperformed the companies that are furthest away from an equal balance in these roles in terms of return on assets over recent years, according to the research.
Where middle management best mirrors women's representation in the overall workforce, companies generated 36 basis points higher risk-adjusted monthly returns compared to peers where this diversity metric is poor, between 2016 and 2022.
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Overweighting companies that promote more women into senior roles would have enhanced a portfolio's performance by 72 basis
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