Governance and Leadership
In recent years, there has been a notable increase in the participation of women in leadership positions across various sectors of the business world. The Best Corporate Governance Practices Code in Mexico recommends the inclusion of women on boards of directors because they can bring unique perspectives and ideas to business matters.
According to Deloitte (2022), out of the 130 companies on the Mexican Stock Exchange, 8.7% have female participation on their boards of directors.
In the specific context of family businesses in Mexico, 20% of these are led by women, a higher figure than other regions such as Asia-Pacific, the Middle East-Africa, and even Europe (KPMG, 2022). Although significant progress has been made, there is still much to be done in this area; therefore, this article seeks to highlight the importance of female leadership in ESG strategies. Below are some ways in which women contribute to the growth and sustainability of family businesses.
Change Management and Adaptability
In an ever-evolving business environment, the ability to adapt and manage change has become crucial for the long-term success of companies. The presence of women in leadership positions enriches the business landscape and provides an opportunity to address challenges from different angles to understand the changing market needs.
Resilience and continuous learning are other contributions of women in businesses. Their ability to handle pressure and move forward in the face of adversity is fundamental to the organization's success. Additionally, women leaders are willing to acquire new knowledge and skills to adapt to the environment. This openness to change allows them to stay abreast of the latest trends, providing them with a competitive advantage to drive innovation and organizational growth. Their willingness to step out of their comfort zone and explore new opportunities helps drive transformation and evolution of the organization in a dynamic business environment.
Building Strong Relationships
Female leadership stands out for its innate ability to build strong relationships and foster unity and collaboration among family business members. Women have exceptional interpersonal skills, enabling them to establish effective communication and build the trust necessary to work as a team. Their ability to inspire and motivate work teams is essential to ensure successful implementation of new strategies.
Additionally, managing family relationships typically falls on women due to their ability to listen and understand, mediate in delicate situations, as well as maintain harmony and family cohesion, avoiding conflicts that could affect performance and strategic direction of the family business. Relationship management is not only internal but also addressing the needs of others allows them to establish a positive reputation for the family business.
ESG and Female Leadership
Female leadership and their concern for the well-being of others recognize the importance of corporate social responsibility and sustainability. This is reflected in the implementation of ethical business policies and practices, promotion of diversity and inclusion in the workplace, adoption of sustainable practices, and participation in social and community initiatives.
In the environmental aspect, female leadership plays a crucial role in promoting sustainable practices and policies that reduce ecological footprint. The presence of women in leadership positions fosters innovation especially in favor of clean technologies, energy efficiency, and responsible management of natural resources, contributing to mitigating environmental risks and promoting a culture of respect for the Earth.
On the social pillar, women leaders not only inspire and motivate work teams but also promote diversity and gender equality in the workplace. Their attention to the needs of others allows them to build strategic alliances and strong relationships with external stakeholders, such as customers, suppliers, and the community at large.
Finally, in terms of governance, female leadership stands out for its commitment to business ethics and transparency. Women leaders promote strong corporate governance practices, including accountability, independence of boards of directors, and responsible risk management. By integrating these values into the corporate culture, they generate a sense of purpose and contribution among family business members.
The participation of women on boards of directors in family businesses becomes a driver of change for ESG strategy. Gender diversity is not just a practice but an opportunity to have an innovative vision and adaptability because women are capable of building strong relationship networks and cultivating a corporate culture rooted in long-term social responsibility and sustainability.
Originally published in the LEGADO Magazine, December 2023 edition.
ABOUT THE AUTHOR
Eva Guerra is Associate Academic Dean at EGADE Business School.
References
Deloitte (2022). Progress at a snail’s pace Women in the boardroom: A global perspective. Deloitte Global Boardroom Program.
KPMG (2022). The regenerative power of family businesses: Transgenerational entrepreneurship: Mexico benchmarking report data. STEP Project Global Consortium and KPMG.
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