Labour MEP: more women on boards would benefit the economy

Photo: Jack Howson
Photo: Jack Howson

ARLENE McCarthy, Labour MEP for the North West region has stated that the further introduction of women into the boardroom would have a beneficial impact upon the economy.

Speaking to students of the University of Salford at the European Parliament in Brussels, she said: “We’ve already seen from research that if you have a woman on your board, your company is less likely to go bust.”

“It’s good for the economy to have women on boards, and it’s good for growth.”

A study performed by McKinsey & Company found that companies with gender balanced executive committees outperformed their all-male equivalents with a 56% higher operating profit.

Mrs. McCarthy states that this is because women are more “risk averse”. She argues: “They make more sensible decisions on financial areas.”

“We should have had more women on board in the big banks because we wouldn’t have had all the problems that we had in the financial crisis.”

Photo: Jack Howson
Photo: Jack Howson

Last year, the Labour MEP supported a proposal by the European Parliament to introduce a 40 per cent target for women in boardrooms.

Despite this, she is careful to state: “Quotas are not the silver bullet. They won’t solve the issue.” Instead, she proposes that more businesses invest in training women to board level.

She argues: “What we’ve got to do first of all is to put in place a support network. If you don’t have women who are on board level you haven’t got women to put on boards.”

This support network, she believes, should provide the necessary training to female workers, as well as facilities for those with children hoping to get back into work.

She also mentioned another alternative method of promoting businesses to invest in female workers. This was the use of media campaigns.

She noted: “In Finland they have a media campaign showing that where you have women on boards the company does better and does more business, and where you have only men you get more closures and more bankruptcies.”

This campaign has been successful so far in influencing companies to invest in women. Finland has the most women in boardrooms of largest listed companies in the European Union.

By Jack Yarwood

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