Adding Value Through Diversity in Business and the Boardroom
By J.J. McCoy, Senior Managing Editor for New Frontier Data
March is Women’s History Month, and while that is the kind of thing that mainstream venues tirelessly use as a hook for articles looking backward, New Frontier Data is naturally more inclined to gauge how women are leaning toward progress forward, and where we see things proceeding by using the past as prologue.
For instance, New Frontier Data is interested in recent findings that companies with women in their highest corporate offices correlate with greater profitability, according to Washington, D.C. based think tank Peterson Institute for International Economics and audit firm Ernst & Young. Their 2016 study of nearly 22,000 publicly traded companies in 91 countries found that an increase in the share of women in leadership positions (from between zero to 30%) was associated with a 15% increase in profitability.
That is news one can use, and (with full disclosure) has keen relevance at New Frontier Data: As profiled in a new book by co-authors Ashley Picillo and Lauren Devine, “Breaking the Grass Ceiling: Women, Weed & Business” (2017), New Frontier Data’s own founder and CEO Giadha Aguirre de Carcer has first-hand experience in fulfilling her own initiative, having worked in investment banking with JP Morgan Chase before launching two other companies prior to founding New Frontier Data in August 2014.
“I would say that the experience has been much better in cannabis than anywhere else,” De Carcer explains. Born in Italy to Cuban-Italian parents, and raised in France, Spain, and Miami before earning degrees from the University of Pennsylvania and Georgetown, she understands the value in diversity when looking around a conference table. “When I was working in the government and technology space, as a comparison, there seemed to be a pre-existing boys club with a profile requirement to enter: white, male, older. This industry was born from a movement, a very diverse movement without pre-existing anything, and I think that made a difference.”
De Carcer is slated among the presenting speakers at “Cultural Diversity in the Cannabis Industry,” the next installment of the Viridian Cannabis Investment Series on March 31 in New York City. Check the link for details.
“Knowledge and perspective comes through diversity,” said De Carcer. “It is not just about adding women, but through a diversity of perspectives, experience and skill sets. Especially as a data company, we understand, respect, and appreciate the value in how the aggregate informs the outcome for the answers we are looking for.”
“Harnessing the power of diversity expands your talent pool and increases creativity,” according to Laila Makled, the Washington, D.C., chair leader for Women Grow, a women’s business cannabis networking organization. She pointed out that Fortune 500 companies with the highest representation of women board directors outperformed those with the lowest representation by 53%, and that companies in the top quartile for racial and ethnic diversity are 35% more likely to have financial returns above their respective industry median.
In New Frontier Data’s own research for an upcoming study of female participation in the cannabis industry, it is proving to be well represented: Women are a growing and increasingly influential demographic. Industry players like Women Grow are expanding rapidly, enabling women to not only build strong professional networks within the industry, but also providing a forum to explore ways to harness the significant power of women in health care and household spending decisions. New Frontier Data’s report for release later this spring will highlight the growing importance of women in the cannabis industry, discussing their expanded role as consumers, patients, company founders, industry executives and caregivers. Visit this link for updates.
Approaching a fifth of the way into the new millennium, women represent half of the U.S. labor force, yet in 2015 earned less on average (79 cents on the dollar) compared to men in nearly every single occupation for which there was reliable data, according to the Institute for Women’s Policy Research.
Nevertheless, as reported this month, the new Forbes 2017 list of the world’s billionaires includes the most women ever in history, with 56 (and 15 in the past year alone) cracking the 10-digit barrier. Using 2016 numbers, women now own an estimated 11.3 million U.S. businesses, employing nearly 9 million people and clearing more than $1.6 trillion (with a ‘TR’) in revenue.
In fact, according to a study commissioned by American Express OPEN, "Business revenues among women-owned firms have increased by 35% since 2007, compared to 27% among all U.S. firms — thus at a rate that is 30% higher than the national average." And yet, as reported by Grasshopper.com, while 38% of new businesses are started by women, only between 2-6% of them receive any funding from venture capital.
That speaks well for the cannabis industry, in which Forbes reported that women make up 36% of the corporate leaders and 63% of management positions, versus 5% of CEOs and 25% of top management in business across the spectrum, according to the Pew Research Center.
Useful news about women making history, indeed.
J.J. McCoy is Senior Managing Editor for New Frontier Data. A former staff writer for The Washington Post, he is a career journalist having covered emerging technologies among industries including aviation, satellites, transportation, law enforcement, the Smart Grid and professional sports. He has reported from the White House, the U.S. Senate, three continents and counting.