The trend of women taking over leadership positions is on the rise, according to the latest numbers from the US Census Bureau. While women-owned firms constitute only 19.9 percent of all firms that employed people in the US in 2018, these numbers reflect a 0.6 percent growth from the year prior. Over 1.1 million businesses are led by women, contributing $1.8 trillion to the economy and employing over 10.1 million workers.
Although the fight against gender disparity rages on, it’s important for us to celebrate progress where we can, especially as female leaders bring something new to the table. Whether they’re small business owners, startup founders, or corporate heads, women in decision-making roles don’t stick to the status quo.
Here are three ways women-led businesses make an impact:
Stronger emphasis on ethical branding
Female business owners aim to solve real-world problems with their brands. They tend to approach their business with purpose, transparency, authenticity, and sustainability in mind. Many women-founded brands try to shake up their respective sectors with fair trade practices, sustainable materials, and uncompromising quality. Habit Cosmetics, for example, is a company that produces eco-friendly nail polish and make-up. Launched in 2013 by Aja Frierson, Habit Cosmetics is committed to using non-toxic, vegan, and cruelty-free formulas, while producing sustainable packaging made of bamboo. Their brand is known for affordability and inclusivity as well.
Women-led businesses focus on longevity through steady, profitable growth, and avoid risky situations by putting a premium on ethics. This fits the picture painted by the University of Virginia’s study on gender and leadership, where researchers found that consumers are less likely to trust an organization after an ethical failure if the business is led by a woman. It’s clear that an ethical brand plays a key role in legitimizing female leadership.
People-oriented workplace dynamics
Respect is what matters most to employees, according to an article from the MIT Sloan Management Review. When measured against over 150 other dimensions of employee experience, respect comes out on top. This is why Maryville University’s management and leadership curriculum notes, some of the most in-demand leadership skills focus on building interpersonal dynamics like team-building and problem-solving. The basis of effective leadership is how you work with people.
Women are socially conditioned towards higher levels of emotional intelligence, effective communication, empathy, and self-awareness. When they are at the helm, female leaders use their people-oriented skills to form strong bonds, create a positive environment, and maintain a comfortable place of work — much like what the staff at social networking platform Nextdoor enjoys. Headed by Sarah Friar, Nextdoor maintains high marks for leadership, compensation, and quality of colleagues, which contribute to overall employee satisfaction and lower turnover rates.
More diverse and innovative products
The sad reality is that the power of female consumers is often overlooked. Because businesses mostly have male leaders in charge, the needs of women aren’t met and many women feel underserved by the market. On the other hand, more diversity in leadership — whether it’s gender, culture, age, and race — can drive further creativity and innovation.
A female business leader will naturally be informed by her experiences, and that of other women. This is how Bumble’s CEO Whitney Wolfe Herd, for instance, reshaped how dating apps work. Bumble famously only lets women initiate conversations in heterosexual matches, allowing women to avoid being bombarded with unwanted messages from men. They’ve also introduced technology that removes lewd photos from the app before users can see them. Although it’s a simple idea, it clearly makes a difference for their 40 million users.
Empowering women in businesses can lead to exciting developments and changes in our world. For more stories on female success, check out our other articles on Women for the Culture.
Exclusively submitted by Tiana Taylor for womenfortheculture.com.