Gender Diversity: Benefits, Challenges & Strategies

When you’re building a company, you want the experience of working there to be positive, supportive, and equitable for all of your employees.

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And in order to do that, you need gender diversity. When it comes to gender, diversity is a large, complex concept—and if you want your team and organization to be successful, you need to both understand and embrace it.

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Let’s take a deep dive into gender diversity—what it is, why it matters in the workplace, and how to create a more gender-diverse work environment within your own organization:

What is Gender Diversity?

First things first—before we jump into the importance of gender diversity in the workplace, let’s quickly cover what, exactly, gender diversity is. 

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Gender diversity is a term that’s used to describe fair, equitable representation for all genders within an organization. This means that men, women, non-binary, and transgender individuals are hired at similar rates, are compensated equitably, hold leadership roles within the company, and have equal opportunities for growth and promotion within the company.

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Gender diversity is also about creating a safe, inclusive culture for all employees—regardless of their gender identity. This includes:

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• Eliminating gender bias and/or unconscious bias in your organization’s systems, processes, practices, and policies (for example, hiring practices and compensation structures)
• Taking a zero-tolerance approach to gender-based harassment, bullying, and/or discrimination
• Including representatives from all genders in the decision-making process when drafting company policies or making decisions that will impact the workforce

Why is Gender Diversity So Important?

Now that you know what gender diversity is, let’s talk about why it’s so important—both for employees and for organizations.

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From the employees’ perspective, when they work in an environment that prioritizes diversity, they know they have equitable opportunities to advance—regardless of their gender. They know that they’re being compensated based on their skills and experience—and don’t have to worry about a gender gap in pay. 

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They see their gender represented across the organization—including in leadership positions. This can help foster a deeper sense of trust and excitement about the job.

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From an organizational perspective, there are some serious benefits of gender diversity in the workplace, including:

Better Company Performance

Gender diversity impacts more than employee experience; it also impacts your organization’s bottom line—and can actually help your company become more profitable. 

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According to research from McKinsey, companies with gender-diverse executive teams had 21 percent higher earnings overall. 

Higher Employee Retention

The Great Resignation saw more employees leaving their positions—and their companies—in record numbers. In response, companies are more concerned with attracting and retaining top talent than ever before.

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And, as it turns out, gender diversity can help you with both.

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Let’s start with attracting talent. According to research from Glassdoor, 76 percent of the job seeker talent pool reported that they consider a diverse workforce an important factor when considering companies and job offers—and 32 percent said they wouldn’t apply to a company if they didn’t see diversity across the organization.

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Gender diversity (and diversity as a whole) is important to attract new talent to your company—but it’s also an important part of keeping your current workforce. According to research from the Corporate Leadership Council, employees that work at a company with a diverse, inclusive workforce are 19 percent more likely to stay in their positions than employees who don’t feel their company reflects diversity and inclusivity. This translates to higher employee retention and a lower turnover rate.

Better Collaboration and Teamwork

Another benefit of creating gender-diverse teams? Those teams become more effective.

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For example, research from Fortinet found that gender-diverse teams made effective decisions 73 percent of the time—compared to just 55 percent of the time for all-male teams. And research from the University of Amsterdam found that gender-diverse teams perform better in sales, profits, and earnings per share than teams that are dominated by a single gender (including female employees or male employees). 

More Diverse Perspectives and POVs

When you hire a diverse team, they bring a diverse set of perspectives and points of view to the table—and when you’re trying to appeal to a diverse customer base, those perspectives and POVs can help you stand out and better connect with your audience.

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For example, if you employ a team of all men, your organization is going to lack the perspective and POV of women, non-binary, and transgender people—and so trying to create a marketing plan or sales pitch that appeals to women, non-binary, or transgender people is going to be a challenge. But if you have those people on your team, they can offer perspectives and POVs that align with the customers you’re targeting—which can increase your chances of success.

Better Organizational Reputation

As a business, you’re only as good as your reputation. If you have a reputation as a work environment that embraces diversity from a gender perspective, that reputation can help you in a variety of ways (for example, attracting top talent and customers—of all genders). On the flip side, if you have a reputation as a work environment that lacks diversity and has gender bias in its DNA, that reputation can shut the door to talent, customers, and opportunities—and your business may suffer as a result.

Challenges for Gender Diversity in the Workplace

Clearly, gender diversity matters—and can deliver some serious benefits to your organization. 

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But unfortunately, a lack of diversity—and employees being treated differently based on their gender—is still a big problem in the workplace. For example:

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• In 2021, median earnings for women were just 83.1 percent of the median earnings for men, according to data from the Bureau of Labor Statistics.
• Forty-two percent of women reported experiencing discrimination in the workplace (compared to just 22 percent of men)—including earning less for doing the same job (25 percent), being treated as if they were incompetent (23 percent), and experiencing repeated slights in the workplace (16 percent) according to research from Pew Research Center.
• For every 100 men promoted to management positions, only 86 women receive similar promotions, according to research from McKinsey.
• Women ask for pay raises just as often as men do—but while men receive those pay increases 20 percent of the time, that figure is only 15 percent for women, according to research outlined in the Harvard Business Review.
• As of March 2022, 74 women were CEOs of Fortune 500 companies, according to the World Economic Forum. That’s a definite improvement (in June 2021, 41 women held CEO positions—and in 2002, that number was just 7), but that’s still only 15 percent of all CEO positions at Fortune 500 companies.

How to Make Your Workplace More Inclusive

So, the question is, as business owners, what can you do to create a more gender-diverse and inclusive work environment within your organization? Here are some tips:

Identify the Areas Where You Need to Improve

You can’t create a more diverse workplace—gender or otherwise–if you don’t know what, exactly, needs to change in order to foster that diversity.

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That’s why, the first step to creating a more gender-diverse workplace? Identifying what areas of your culture need to be improved.

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While every company is different, when it comes to diversity from a gender perspective, there are a few different areas you’ll want to look at—and questions you’ll want to ask yourself—including:

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• Employee demographics: It’s important to define where your company currently stands with diversity from a gender perspective. Are all genders equally represented within your company? And, to take that a step further, are all genders equally represented in different departments, levels and teams (for example, engineering or marketing) within your organization?
• Leadership: This is the strongest step in creating a culture of diversity. Why? Because diverse leaders organically introduce diverse thinking, hiring and training. It’s also an incredibly strong recruitment tool. Candidates from diverse backgrounds are more likely to join your team when they know their growth will be supported regardless of their gender. So, do you have an even balance of genders at the highest levels of your organization?
• Hiring practices: Building a more gender-diverse team starts with who you hire–so it’s important to examine your current hiring practices. Are all genders equally represented at each stage of the hiring process–including sourcing, interviewing, and extending offers?
• Promotion practices: Hiring more diverse candidates is important—but so is ensuring that those candidates have opportunities to grow within the company. Are you promoting employees of all genders at the same rate? 
• Compensation structures: It doesn’t matter if you employ workers of every gender; if you’re not paying them equitably, you’re missing the mark on diversity. What do your current compensation structures look like? Is one gender paid more for similar roles, jobs, or levels of experience than other genders? Or is one gender being granted pay raises with more frequency than other genders?
• Employee experience: Representation is a big part of diversity—but so is experience. Are your employees of all genders having a safe, supportive, and positive experience at work?

Set SMART Goals

Once you know what areas need to be improved, it’s time to start setting goals to help drive those improvements.

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The most effective framework for setting goals—diversity-related or otherwise—is the SMART goal framework. With the SMART goal framework, every goal you set should be:

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• Specific
• Measurable
• Achievable
• Relevant
• Time-Bound

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So, for example, let’s say you realize that you own a painting company and realize your painting workers are almost completely male—and you want to bring on more female staffers.

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A goal of “hiring more female painters” is unlikely to drive results; it’s too vague, it doesn’t define how you’re going to measure success (are you going to hire one female painter or 10?), and it doesn’t give any time-constraints—which means there’s no sense of urgency.

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On the flip side, “hire five female painters in the next 24 months” fits into the SMART framework; it’s specific (it tells you exactly what to do), it’s measurable (you’ll know whether you hire five painters—or you miss the mark), it’s achievable (you’ll need to hire 2 to 3 female painters per year to hit your goal, which is a totally reasonable pace), it’s relevant (as you’re trying to create a more diverse team at your company), and it’s time-bound (you have 24 months to complete the goal). 

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This gives you a clear direction of how to hit your goal—which will increase the chance that you’ll be successful. 

Gather Insights from a Diverse Set of Employees

You may think you know what needs to change to create a more gender-diverse work environment—and how to make those changes.

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But diversity is all about embracing and empowering different voices, opinions, and insights. So, as you’re working to create more gender diversity within your workplace, the best thing you can do? Ask your employees of different genders what diversity means to them—and how they’d like to see the workplace change.

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Connecting with employees of different genders will give you invaluable insights into the current state of your workplace and what needs to change. So get in touch with them! Send out surveys. Hold focus groups. Meet with employees one-on-one. Ask them about their experiences within your organization—and then use their feedback and insights to drive positive change.

What are the Different Types of Diversity—And What Category Does Gender Diversity Fall Under?

Prioritizing gender diversity is a must for organizations that want to create real gender equality within their companies. But it’s not the only type of diversity you need to be thinking about.

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According to research outlined in the Harvard Business Review, diversity can generally be broken down into three categories: 

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• Demographic diversity: Includes identifying characteristics like gender, age, race, ethnicity and sexual orientation
• Experiential diversity: Includes hobbies, preferences, talents and abilities
• Cognitive diversity: Diversity in thinking and problem solving

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If you want to build a truly diverse workforce, you need to be thinking about diversity in all of its contexts—so make sure you’re prioritizing other types of diversity in the workplace in the same way you are prioritizing gender equality and diversity.

Create a More Gender Diverse Workplace–and Watch Your Organization Thrive

Creating a more diverse workplace isn’t something that happens overnight. But creating a safe, supportive, and equitable work experience for employees, regardless of their gender, is a must—not only for your team, but for the health of your organization. 

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So what are you waiting for? Put gender diversity at the top of your priority list—and start taking steps to embrace more diversity in the workplace today.