- Insolvency rates are 70% higher in male run companies
- Only 12 out of 347 companies that went into administrations in the 12 months up to June 2018 were female run.
Gender variances: Administration vs LiquidationThe research found a disparity between male and female led companies when it came to choosing the method of insolvency. Male led businesses were more likely to pursue administration. But this is down to existing gender representation norms in the workplace rather than preference. For example, administration is a costlier process and tends to be used by bigger businesses that happen to be male dominated.
? Insolvency rates are higher in male run businesses, but this may be due to a number of factors including that the industry or recent economic events are coincidently run by men.??Robert Moore,?Marketing Manager, KSA Group
Less data for women leaders means less risky behaviourThe difference in size of each data set is substantial. This is because only 1 in 8 SME businesses covered in the survey were run by 75% women. There is more data available on insolvent male run businesses because there are more men working at high levels of business than women.
?There is little difference in the industry sectors of companies run by men or run by women that went bust.?
Lack of representation8 times as many companies are run by men than by women.?This should dispel gender myths such as the finance sector is more male dominated because men are ?better? at making risky decisions than women. If the male dominated insolvency correlation is the case across all business sectors, it must be down to other factors? namely lack of female representation on the boards of SMEs.
Insolvency risks have no genderThe variations in insolvency rates between male and female led SMEs are not down to gender characteristics.?What the results do confirm however, is that women continue to be underrepresented as leaders on the boards of SMEs, and all businesses generally. Without the equal representation of women at board level, we cannot explain why male led businesses are more likely to experience financial issues, other than there are more men in senior business roles. We cannot prove that male SME leaders face more insolvency risks solely because of their gender. The upside to this evaluation is that no candidate can be barred from entering any business sector due to their gender. Additionally, it brings home the point that board members should be appointed for their individual capabilities to manage funds and navigate economic uncertainties, abilities that are of course? gender neutral.
Share this story