Female leaders during Covid-19: do women lead differently?

Percentages of women in leadership positions

In 2020, only 5% of FTSE 100 chief executive officers (CEOs) are women.¹ The FTSE 250 is even further behind, with just 2% of companies being led by females, including IG Group which is led by June Felix.

Globally, we see a similar story. A recent survey revealed that just 5% of over 3000 companies across 56 countries had female CEOs in 2019.² And only 4.7% of companies that make up the S&P 500 have female CEOs in 2020.

Despite this underrepresentation, the share price returns of female-led companies outperformed their male counterparts in four out of nine sectors during the coronavirus pandemic.³ While men have seen stronger returns in the other five sectors, when you consider the skew toward male companies, this is hardly a surprise. For example, the energy sector has 25 male-led companies for data points compared to just one female.

On top of that, hedge funds that are run by women were outperforming those run by men.⁴ Hedge Fund Research's (HFR’s) Women Access index lost just 3.5% in the first four months of 2020, while the HFRI Fund Weighted index – which includes male and female-led funds – fell by 5.5%.

So why is it that some firms have chosen to forego female leadership during the current crisis?

Leadership styles – what are the differences?

Typically, many characteristics that are sought after in leaders tend to be seen as ‘masculine’ – such as over-confidence and aggression. But behavioural analysis suggests that, while women are very capable of exhibiting these traits too, doing so is unhelpful in times of financial and social crisis.⁵

The key takeaway here is not that only women can cope during times of crisis, but that without the inclusion of women across the board, there is less likely to be success.²

One of the main differences cited by studies is that female leaders, on average, are more democratic and participative than their male counterparts.⁶ While men are more likely to make decisions on their own and have confidence in their own abilities, female leaders tend to surround themselves with advisers – seeking input from others and listening to a wider pool of experts.⁷ These processes are not only more likely to encourage participation from all levels of a company, but also boost morale.

Some female leaders are known for making unpopular decisions. This can be caused by what is known as the ‘glass cliff’ – the idea that some women are put into positions of leadership during crises, which increase the likelihood of failure or low approval rates from employees.⁸ But that just gives women the space and freedom to make the right decisions, regardless of whether they are popular or not.

Studies have found that a lot of male leaders actually increase risk-taking under stress, while female leaders tend to be more risk-averse.⁸ On top of this, research by the International Finance Corporation found that companies with female-dominant staff established safer working conditions – with female leaders curating a culture of safety first among their employees.⁹

Although some women struggle more than their male counterparts to discuss issues such as their own salaries and career advancement, they’re excellent at negotiating welfare and development for others.⁵ The C3000 study showed that mental health was more likely to be a focus for female-owned family businesses² – and in lockdown and self-isolation, the mental health of employees is definitely a priority.

Female leadership in politics

The difference between male and female leadership isn’t only shown in boardrooms across the world, but in governments.

Women make up just 7% of leaders worldwide.¹⁰ But looking at the number of coronavirus cases per capita, we can see that the countries with female leaders have fewer cases than the majority of male leaders’. That’s not to say that some male-led countries haven’t also implemented successful lockdown measures, but that few countries with female leaders have done badly.

Having fewer coronavirus cases can directly be linked to how fast countries executed social distance plans. Countries like Germany and New Zealand fall into this category. Although at the time, the decisions to shut down society as we know it proved unpopular, they have dramatically reduced the number of cases in these countries.

C200 and IG: insights from five female leaders on the Covid-19 pandemic

We’ve partnered with C200 to see how five female leaders are faring during the coronavirus crisis. With businesses spanning industries, take a look at these inspiring stories of how the pandemic has impacted their business and how they’re helping their staff.

Merrilee Kick

Merrilee Kick is the CEO of BuzzBallz and Southern Champion – the only female-owned winery in the US. Listen to her story of switching production to hand sanitiser and how she’s ensuring her employees feel valued.

Savannah Maziya

Savannah Maziya is the founder and executive chairperson of Bunengi Holdings Group, one of Africa’s most prominent black female-owned investment groups. Watch the video below to hear her talk about why women are succeeding throughout Covid-19 and the lessons we can learn from the pandemic.

Hannah Kain

Hannah Kain is the president and CEO of supply chain management firm ALOM Technology. Hear her discuss her coronavirus task team and how her experience is a vital resource for the company.

Alison Gutterman

Alison Gutterman is the CEO and president of Jelmar, a cleaning product manufacturer that supplies retail stores across the US. Find out how she’s trying to reduce the stress on her team as the pandemic increases demand for her firm’s products.

Rani Yadav-Ranjan

Rani Yadav-Ranjan is the global head of AI technology and innovation at Ericsson. Listen to her thoughts on why employee talent matters more than anything else and why technology is at the core of the ‘new normal’.

Footnotes

1 Research conducted on ‘Top female CEOs in the UK in 2020’ by IG
² Credit Suisse, 2019
³ Data taken from 19 February – the start of the coronavirus crash – to 31 May 2020
4 Financial Times, 2020
5 Hannah Riley Bowles, Bobbi Thomason and Julia Bear, 2018
6 Michelle K. Ryan and S. Alexander Haslam, 2007
7 Nichole R. Lighthall ,Mara Mather,Marissa A. Gorlick, 2009
⁸ Harvard Business School, 2013
⁹ International Finance Corporation, 2016
¹⁰ Inter-Parliamentary Union, 2019 ​