The best performing ASX300 companies have a lot in common when it comes to their behaviour and board composition, according to a new KPMG report.
Mid-market businesses with diversity in the boardroom, a long serving chair and a shareholder with a stake of 50 per cent or more are outperforming their peers, the KPMG ASX300+ Report found.
Businesses with women on the board achieved higher revenue growth, profitability and shareholder returns in 2016 than companies which didn’t, KPMG said, and businesses led by a female chief executive delivered a 9 per cent increase in revenue, compared with the cohort’s average of 0.5 per cent growth.
“The mid-market sector represents over 65 per cent of the Australian economy and is Australia’s engine room,” said KPMG Enterprise national managing partner Rob Bazzani.
“While companies in this group do not have the same degree of diversity at board and senior level, those that do showed better results last year than their competitors.”
The research also found a faster rate of revenue growth in companies that invested in “intangible assets” like technology than companies that didn’t, and an 11 per cent increase in overall revenue for the year in companies that had completed an acquisition.
“Although there are worrying levels of financial distress among the companies we surveyed, those investing and making acquisitions did notably better than their peers,” Mr Bazzani said.
“There is a direct correlation between acquisition and profitability, therefore we would encourage businesses to remain positive and seize any opportunities available.”