IWD 2024: Embracing empathetic leadership as key to greater gender diversity

131 years. That is how long the World Economic Forum estimates it will take to achieve global gender pay parity if we continue the current rate of progress. This is a sobering number that truly underscores the state of the gender disparity.

For the insurance sector, this problem is especially significant at the senior level, where there is only 23% of female representation at C-Suite roles, 10% for CEOs and 8% for board chairs globally in 2019. Despite some progress in recent years, there is still a large gap to close and a need to foster a more inclusive culture.

Digging deeper, a large part of the issue lies in the perception of "female" traits, which are perceived as less desirable in leadership roles. However, traits like empathy, risk aversion and agreeableness have been shown to impact a business' bottom line positively. 

So, how can organisations tackle today's imbalances and promote more inclusivity and diversity?

The business case for empathetic leadership and other "female" traits

Numerous studies have examined the psychological and personality differences between women and men, and there are three key personality traits that are often associated more with women. In addition, studies have shown that these traits are often overlooked or seen as less desirable in organisations, especially in leadership positions.

However, these traits can lead to more effective leaders and, if used correctly, have the potential to create a more diverse and impactful culture.

Empathy

Empathy, despite being a soft skill, is a crucial quality that has an elevated importance post-pandemic. The shift to working in remote and hybrid settings magnified the need for empathy to communicate, understand and support individuals within the workplace.

Empathetic leaders are effective in promoting diversity and belonging within their organisations. This is because they recognise the unique strengths and perspectives that individuals from diverse backgrounds bring to the table and create opportunities for everyone to contribute and succeed.  

Leading by empathy yields positive effects on decision-making and enhanced conflict resolution by managing the diverse range of stressors in the modern workplace and navigating conflicts and disagreements in ways that are most constructive for the team.

In a recent study of nearly 900 employees in the U.S by Catalyst revealed that in cases where senior leaders demonstrate a high level of empathy, 61% of individuals frequently or consistently express innovative behaviour in their workplace. 

A significant 50% of individuals who have highly empathic senior leaders experience inclusion at work, while 76% frequently or consistently exhibit high levels of engagement. In the same study, 57% of white women expressed that they were hesitant to consider leaving their organisations if they felt their life circumstances were respected and valued by their companies. Similarly, among women of colour, this percentage was slightly higher at 62%. 

Risk Aversion

The cautious and risk-averse nature often associated with women has also proven to be an important trait that will yield positive outcomes in areas such as financial decision-making and investment management.

Striking the balance between taking risks to innovate and grow while also mitigating potential negative outcomes constitutes prudent decision-making that allows for a balanced and cautious approach to risk. This is a valuable trait for leaders that is needed to navigate uncertain environments more effectively, safeguard resources, and enhance their resilience in the face of challenges. 

Agreeableness

This is an attribute that makes leaders easy to work with, fostering cooperation, teamwork, and positive relationships. It is reflected in an individual's willingness to dedicate effort to tasks, demonstrate high-quality work and respond positively to the work environment.

Leaders who practice agreeableness create a culture of openness, respect, and mutual understanding on the foundation of collaboration. The team can navigate challenges more effectively and contribute to a workplace culture that values effective communication, teamwork, and equitable treatment.

Celebrating the unique value women bring for a more inclusive corporate landscape

Instead of framing challenges in gender disparity as unfairness, women can leverage their unique skills, such as empathy and collaboration, to excel in male-dominated environments. 

At the same time, empowering women to lead authentically can drive transformative impacts, benefiting organisations with diversified perspectives. 

Organisations can take actions such as recognising unseen barriers, shifting to competency-based promotion systems, and implementing systematic talent development to foster gender equality. 

Ultimately, achieving diversity in leadership involves recognising and celebrating the unique value women bring, paving the way for a more inclusive corporate landscape.