The impact of women executives on companies’ financial performance: A study of south Africa’s state-owned companies

South Africa’s former apartheid government deeply entrenched racial and gender inequalities amongst South Africans and excluded both blacks and women from participating in the economy and the workplace. Since the advent of democracy in the country in 1994, regulations such as the Employment Equity Act of 1998 were introduced to include both women and blacks in the working environment. The purpose of this study is to empirically examine the impact of gender diversity on 21 State-Owned Companies (SOCs), from 2010 to 2014. Correlation and regression analysis were used to investigate the relationship between women who are executive managers and the companies’ financial performance (i.e. profit margin, return on assets and fruitless and wasteful expenditure as a percentage of revenue). The results indicate that there has been slow progress made by the South African government in recruiting women at the executive management level in SOCs. Furthermore, an insignificant relationship was found between women in executive positions and the financial performance of those SOCs. These findings are useful for South African regulators and policymakers as they justify efforts to employ women in the executive management teams in SOCs. The study adds to existing research in the private sector, demonstrating the financial benefits of gender diversity