Women in leadership in the sporting goods industry

Jump to a topic or read the full article:

• Board structure and gender in the sporting goods world
• The gender breakdown of executive teams in the sporting goods world
• How does female leadership in the sporting goods industry compare with the rest of the business world?
• Why board gender diversity matters. How diversity improves business performance
• Why three is the magic number for women on boards
• Sporting goods industry and the “tipping point” of female directors
• The benefits of diversity beyond business performance
• What’s next for gender equality?
• How did we get these numbers?

Board structure and gender in the sporting goods world

•  Out of 81 companies, 10 have females leading the board (12.3 percent)
• 4 companies from the 77 for whom the information was available have no women on the board (5.2 percent)
• Almost half the companies examined have 25 percent women or less on the board of directors (34 out of 77, or 44.2 percent)
• Only 5 of 77 companies have 50 percent or more women on the board (6.5 percent)
• The highest ratio of women on the board of directors is found at Nautilis Group, with an 80 percent female board
• Of a total number of 683 board positions across 77 companies, just over a quarter  are filled by women (28.3 percent, or 193 out of 683)
• The average percentage of females on a board of directors is 27.9 percent

The gender breakdown of executive teams in the sporting goods world

The figures for executive teams and the overall percentage of women therein is somewhat similar to those for boards of directors, but in terms of female representation on executive teams, the situation is less positive.

There is a much higher number of companies with all-male executive teams, and, unlike for boards of directors, the majority of companies have less than a quarter of executive positions filled by women.

• From 86 companies, 7 have female CEOs (8.1 percent). Of these companies, 5 are publicly traded
• Of the 65 companies who make the information available, almost a quarter have no women on their executive team (16, or 24.6 percent)
• Almost a third have 10 percent or fewer women on their executive team (21 of 65, or 32.3 percent)
• The majority of companies have 25 percent or less women on their executive team (40 out of 65, or 61.5 percent)
• Only 5 of 65 companies have 50 percent or more women on their executive teams (7.7 percent)
• No brand has more than 63 percent of women on their executive team, a ratio achieved by Lululemon
• Of a total number of 561 executive team positions across 65 companies, less than a quarter are filled by women (134, or 23.9 percent)
• The average percentage of females on executive teams is 21.3 percent

Of our eight companies with female chairs of the board, three of these companies (Lululemon, Puma, and Peloton) also topped the group of companies with 50 percent or more women on the executive team.

How does female leadership in the sporting goods industry compare with the rest of the business world?

A 2023 report from Altrata¹ based on a dataset of more than 1,712 companies and approximately 29,468 individuals from 20 of the world’s major economies (the Global 20) shows that

• 30 percent representation of women on boards (+/- 0 percent change from 2022)
• 9.5 percent of board chairs are women (+0.6 percent growth from 2022)
• 6.4 percent of CEOs are women (+1.4 percent growth from 2022)

These figures represent a positive trend, with numbers showing an increase from 2022 to 2023, according to the Altrata report. It’s important to note that while the representation of women in management positions in the sporting goods industry aligns closely with or is slightly better than these averages, our analysis is derived from a considerably smaller dataset, and our data collection occurred in 2022.

Given the overall upward trajectory in women’s leadership representation across all sectors as indicated by the Altrata report, it is reasonable to infer that the sporting goods industry may have also experienced similar growth in 2023.

But does it really matter how many women are on a board or in an executive team? The answer, for business performance, is yes.

Board diversity improves business performance

There is an overwhelming amount of research that now suggests a link between gender diversity in senior management and improved business performance. Credit Suisse Research Institute²went so far as to declare this a “clear link”. In its 2016 report, Credit Suisse concluded: “Where women account for the majority in the top management, the businesses show superior sales growth, high cash flow returns on investments and lower leverage.”

They looked specifically at cash flow returns on investments and found: “The higher the percentage of women in top management, the greater the excess returns for shareholders.” This was particularly true for companies with more than 33 percent females in senior management.

While not arguing causality, for Credit Suisse Research Institute, there is a consistency in its findings: “Companies with a higher proportion of women in decision-making roles continue to generate higher returns on equity, while running more conservative balance sheets.”

As we will show, this trend is reflected in the performance of sporting goods industry companies.

For women on boards, three is the magic number

Independent research providers MSCI³ also found a link between more women in management roles and increased performance, but they point to another interesting trend: that three women (or more) on the board is the magic number. By examining U.S. companies over a five-year period (2011-2016) they found that companies with at least three women on the board – a number they refer to as the “tipping point” – experienced median gains in return on equity (ROE) of 10 percentage points and earnings per share (EPS) of 37 percent.

“In contrast, companies that began the period with no female directors experienced median changes of -1 percentage point in ROE and -8% in EPS over the study period.” They conclude: “The presence of at least three women directors may be seen as a doubly positive indicator: of a better-performing company and of a more functional organization overall.  In short, having more women directors may lead to a virtuous cycle.”

For the 30 Percent Club – a voluntary organization of senior professionals committed to increasing female representation on boards and executive leadership teams – 30 percent is the critical mass at which minority voices become heard. 

So is this trend repeated in the companies we examined? When looking at the board composition in the sporting goods industry, there does seem to be some overlap between the tipping point figure of 3 women on the board and the success of a company.

Sporting goods industry and the tipping point of female directors

Using our most recent Global Industry Stock Market Performers, the majority of the top 25 percent highest ranking companies had 3 or more women on the board  (66.7 percent). When increasing this scope to cover the top half of performers, more than half had three or more women on the board (54.1 percent).

Moving down to the lower half of our performer rankings, just over a third - a much lower 36.8 percent - have three or more women on their board. Zooming in on the bottom quarter, just 31.6 percent have 3 or more women. When we compare the top quarter (66.7 percent) with the bottom quarter of the rankings (31.6 percent), the results do seem to mirror MCSI’s findings that 3 or more women typically leads to a better performing company.

Why is this? Whilst there is no hard and fast reason, the academic research indicates that more diverse groups make better decisions and more effectively utilize the available talent pools. And the benefits may extend beyond financial performance.

The benefits of diversity go beyond business performance

Diverse management teams may also be more innovative. A study from Boston Consulting Group in 2017 found that companies with higher levels of diversity get more revenue from new products and services. When there is a non-trivial percentage (i.e. more than 20 percent) of women in management positions, there is a high statistically significant relationship with innovation.

Recruiting and retaining talent may benefit from having more women in top management positions too, as women are more likely to express an interest in such organizations, and desire to stay at a company is linked to feelings of inclusion.

And after looking at research from around the world, non-profit Catalyst⁵gathered together an extensive list of benefits. These include: additional boosts to reputation and responsibility that come from mixed-gender boards; effective risk-management practices; fewer financial reporting mistakes; fewer controversial business practices such as fraud; and better ESG performance. All of which improve a company’s reputation to both potential employees and consumer confidence.

This is not the end of the story

Many countries now have legislation mandating minimum requirements of gender diversity on boards, but these are a somewhat blunt tool. Ultimately, the process should not simply be about tokenism and box checking.

“Diverse” then doesn’t just mean gender diversity. It means diversity in race, ethnicity, education level, industry background, physical disabilities, marital and family status, and sexual orientation.

Improving the numbers is not so simple as putting an extra woman on the board. Companies need to identify the “missing rung” that is limiting women’s access to management, and specifically, management roles that lead to board-level or executive team positions.

Women are often concentrated in management functions that act as a “glass wall” away from top executive positions, according to the International Labour Organization. They found that women are over-represented in support management functions, such as human resources, finance and administration. Whereas men are over-represented in operations, R&D, and profit and loss management functions. These are considered to be more strategic for enterprises and are often a springboard to CEO or board-level positions.

However, as Polygiene CEO Ulrika Björk said in an interview with us last year: “A good start is to appoint more women to the boards of directors. That is the first step to break the norms to get credibility and walk the talk.”

The authors of The Mix That Matters confirm that these high level findings – that diverse management improves performance – could also be the most important. Because realizing this “allows the discussion to move from ‘whether’ to ‘what now?’ And that’s when progress begins.”

How did we get these numbers?

We examined 88 publicly traded companies listed in our Global Industry Stock Market Performers as well as a privately owned company featured in our top sports apparel brands list, which has a board of directors, in Feb. 2023. Of these 89 companies, 77 provide a full breakdown of their board structure. 81 of the 89 provide information on the chairperson of the board.

When it comes to executive management teams, we again looked at the 88 publicly traded companies listed in our global industry stock market performers as well as 11 of the biggest privately owned companies that feature in our top sports apparel brands list. From the 99 companies examined, we were able to find information on the CEO position for 86 companies. 65 of our 99 companies provided information on their executive team structure.

Board and executive team composition came from publicly available information on brands’ own websites. For the purpose of this article, ‘women’ is defined by a person using she/her pronouns. ‘Man’ is defined by a person using he/him pronouns. There were no non-binary individuals found.

¹  Global Gender Diversity 2023, Altrata (2023). https://info.altrata.com/global-gender-diversity-2023-pdf

²  The CS gender 300: The reward for change, Credit Suisse (2016). https://static1.squarespace.com/static/5d4dc6663c80a1000100b072/t/5e97b501bc1186542410bfe9/1587000597468/CS+Gender+3000+2016.pdf

³  The tipping point: Women on boards and financial performance, MSCI ESG Research LLC (2016), https://www.msci.com/documents/10199/fd1f8228-cc07-4789-acee-3f9ed97ee8bb

⁴  The Mix That Matters. Innovation Through Diversity, Boston Consulting Group (2017): https://www.bcg.com/publications/2017/people-organization-leadership-talent-innovation-through-diversity-mix-that-matters

5 Why Diversity and Inclusion Matter (Quick Take), Catalyst (2020), https://www.catalyst.org/research/why-diversity-and-inclusion-matter/

⁶  Women in business and management: The business case for change, International Labour Organization (2019) https://www.ilo.org/wcmsp5/groups/public/—dgreports/—dcomm/—publ/documents/publication/wcms_700953.pdf#

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