women fortune 500 ceos - amanet.org · female ceo to break into the fortune 500 list in 1972. ......
TRANSCRIPT
© 2015 American Management Association All rights reserved.
This publication may not be reproduced, stored in a retrieval system, or transmitted in whole or in part, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the American Management Association, 1601 Broadway, New York, NY 10019.
The scanning, uploading, or distribution of this book via the Internet or any other means without the express permission of the publisher is illegal and punishable by law. Please purchase only authorized electronic editions of this work and do not participate in or encourage piracy of copyrighted materials, electronically or otherwise. Your support of the author’s rights is appreciated.
About AMA
American Management Association (www.amanet.org) is a world leader in talent development, advancing the skills of individuals to drive business success. Our mission is to support the goals of individuals and organizations through a complete range of products and services, including classroom and virtual seminars, webcasts, webinars, podcasts, conferences, corporate and government solutions, business books, and research. AMA’s approach to improving performance combines experiential learning—learning through doing—with opportunities for ongoing professional growth at every step of one’s career journey.
This publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is sold with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional service. If legal advice or other expert assistance is required, the services of a competent professional person should be sought.
American Management Association • www.amanet.org
WOMEN FORTUNE 500 CEOS HELD TO HIGHER STANDARDS
Katherine Graham of the Washington Post Company became the first
female CEO to break into the Fortune 500 list in 1972. Ever since, women’s
advocacy groups have been monitoring the progression of women into the
highest ranks of business. When Fortune released the 2014 Fortune 500
list of America’s biggest companies, the magazine’s editors cited the good
news and what they called the “meh” news. The good news is that the
number of women Fortune 500 CEOs reached an all-time high of 4.8%,
up from 0.2% in 1998 and 4.2% in 2013. 1
Source: United States Census Bureau, “Census Bureau Releases Equal Employment Opportunity Tabulation That Provides a Profile of America’s Workforce” (2012).
2 Women Fortune 500 CEOs Held to Higher Standards
American Management Association • www.amanet.org
The “meh” news, of course, is that 4.8% is paltry relative to women representing 47.5% of the labor force (according to the most recent statistics from the U.S. Census Bureau). 2 The Census confirmed other
.ecrofkrow eht ni ecaf nemow seitilauqeni ,gnikcohs llits tey ,nwonk ylediw
The American Management Association, a not-profit organization dedicated to transforming talent in the workplace, dug deeper into the backgrounds of Fortune 500 CEOs and discovered that, in this small but crucial population, women appear to be systematically more qualified than their male counterparts.
First, women Fortune 500 CEOs have more rigorous academic degrees, as evidenced by the following:
36% of female versus 28% of male Fortune 500 CEOs hold undergraduate degrees in science, technology, engineering, or mathematics (STEM).
Bureau of Labor Statistics and United States Census Bureau, “Current Population Survey: Table PINC-11. Income Distribution to $250,000 or More for Males and Females: 2013.
Women Fortune 500 CEOs Held to Higher Standards 3
American Management Association • www.amanet.org
�� The average undergraduate school ranking is 163.5 for female
versus 167.2 for male Fortune 500 CEOs (based on 2014 Forbes
rankings).
�� The average graduate school ranking is 18.1 for female versus 20.7
for male Fortune 500 CEOs (based on 2014 US News & World
Report rankings).
These statistics indicate that women are held to different standards.
Other research supports this observation and indicates that women at all
levels are held to a higher standard. For example, despite the fact that more
women than men graduated from US colleges with bachelor’s degrees
in every year since 1982, only 1.1% of women earn $150,000 or more
compared to 4% of men. 3
Source: American Management Association Special Report, Women Fortune 500 CEOs Held to Higher Standards, Jeremey Donovan (2014).
4 Women Fortune 500 CEOs Held to Higher Standards
American Management Association • www.amanet.org
Second, women Fortune 500 CEOs typically have more work and life experience when initially appointed. Specifically, the average age at appointment for females is 52.8 years old versus 50.2 for males.
Source: American Management Association Special Report, Women Fortune 500 CEOs Held to Higher Standards , Jeremey Donovan (2014).
Source: American Management Association Special Report, Women Fortune 500 CEOs Held to Higher Standards , Jeremey Donovan (2014).
Women Fortune 500 CEOs Held to Higher Standards 5
American Management Association • www.amanet.org
Third, women Fortune 500 CEOs work their way up the corporate
ladder internally. We found that only 20% of females versus 26% of males
were appointed from the outside.
Nearly equal percentages of female (60%) and male (61%) CEOs show
either no political affiliation or equal political affiliation. Being “a-political”
or “bi-political” is less polarizing. Among those demonstrating a political
affiliation, women Fortune 500 CEOs are twice as likely to be Democrats
as compared to their male counterparts.
In 2013, Steven Davidoff Solomon, a professor of law at the University
of California, Berkeley, examined4 possible root causes for such
inequalities despite compelling evidence that companies run by women5
or with female board-of-director members6 perform better. Professor
Solomon suggested explanations, including: Sex discrimination, male-
driven workplace cultures that do not allow women to succeed, childcare
responsibilities, and demographic changes.
As Fortune highlighted, the rising number of women Fortune 500 CEOs
is a sign of progress. However, the American Management Association’s
analysis of CEO education indicates that the largest companies in America
still have a long way to go. Based on AMA’s 90+ years’ experience developing
leaders, we offer 10 suggestions for leveling the playing field.
10 Things Organizations Can Do to Develop Women Leaders
1. Evaluate. Start with a comprehensive audit of your compensation
policies and practices to ensure that discrimination—either overt
or unintentional—isn’t occurring. Make sure to:
• Establish written compensation guidelines, including commissions and bonuses
• Review hiring practices, especially starting salaries
6 Women Fortune 500 CEOs Held to Higher Standards
American Management Association • www.amanet.org
2. Educate organizational leaders about gender pay gaps and
encourage them to support female career development.
3. Expand women’s networking opportunities through internal
affinity groups, lunch and learns, and company events.
4. Create an individualized leadership development plan with every
employee.
5. Assign a mentor. As this study shows, women who make it to the
top often rise up through the ranks of their companies (versus
men who are more likely to be hired from the outside). Internal
relationships help women navigate the politics of an organization
and expose them to new opportunities.
6. Provide private coaching. While mentoring from managers is
fairly common, professional coaching is offered by just 15% of
employers, according to a study by the American Management
Association.7 Employees often benefit from outside advice and
counsel.
7. Invest in training that emphasizes experiential learning,
especially for the “soft” skills. It’s often said that women and men
communicate differently, and these subtle differences are often
touted as reasons why women are not chosen for leadership roles.
8. Establish stretch projects and guidelines to ensure that projects
designed to groom future leaders are assigned fairly. Women
need experience with high-profile and complex projects to build
confidence, credibility, and gain visibility within the organization.
9. Offer flexible work arrangements. Acknowledge that people
have a life outside of work and sometimes are in situations
where work/life balance becomes more challenging. This is a
particular issue for women who are often put in the caregiver
role for their children or an elderly parent, though increasingly
Women Fortune 500 CEOs Held to Higher Standards 7
American Management Association • www.amanet.org
this role is shared by men. Flex time, job sharing, telecommuting,
and compressed schedules are examples of flexible work
arrangements that can really make a difference to working
caregivers. Progressive companies even offer women a slightly
different leadership track, allowing them to take a less demanding
job during childrearing years with the option to revert to a more
demanding role later.
10. Focus on global skills. Leaders today must deal with
multinational teams on a regular basis and need global skills,
including knowledge of local practices, cultural sensitivity, and
sophisticated communication techniques. According to the
American Management Association,8 only 19% of companies feel
they are adequately training their employees to handle this global
shift.
About the Author
Jeremey Donovan is chief marketing officer of American Management
Association International. AMA is the world’s leading nonprofit,
membership-based management development, research, and publishing
organization. Prior to joining AMA, Jeremey served as group vice president
of marketing at Gartner Inc., the world’s leading information technology
research and advisory company.
References
1. Caroline Fairchild, “Number of Fortune 500 Women CEOs
Reaches Historic High” Fortune (June 3, 2014). http://fortune.
com/2014/06/03/number-of-fortune-500-women-ceos-reaches-
historic-high/
8 Women Fortune 500 CEOs Held to Higher Standards
American Management Association • www.amanet.org
2. United States Census Bureau, “Census Bureau Releases Equal
Employment Opportunity Tabulation That Provides a Profile of
America’s Workforce” (2012). http://www.census.gov/newsroom/
releases/archives/employment_occupations/cb12-225.html
3. Bureau of Labor Statistics and United States Census Bureau,
“Current Population Survey: Table PINC-11. Income Distribution
to $250,000 or More for Males and Females: 2013” (2013). https://
www.census.gov/hhes/www/cpstables/032014/perinc/pinc11_000.
htm
4. Steven Davidoff Solomon, “Why So Few Women Reach the
Executive Rank,” New York Times (April 2, 2013). http://
dealbook.nytimes.com/2013/04/02/why-so-few-women-reach-
the-executive-rank/?_php=true&_type=blogs&_php=true&_
type=blogs&_r=1
5. Christian L. Dezso and David Gaddis Ross, “Does Female
Representation in Top Management Improve Firm Performance?
A Panel Data Investigation,” Social Science Research Network
(March 9, 2011). http://papers.ssrn.com/sol3/papers.cfm?abstract_
id=1088182
6. Anne Sweigart, “Women on Board for Change: The Norway
Model of Boardroom Quotas as a Tool for Progress in
the United States and Canada,” Northwestern Journal of
International Law & Business, vol. 32, issue 4 (2012). http://
scholarlycommons.law.northwestern.edu/cgi/viewcontent.
cgi?article=1007&context=njilb
7. American Management Association, “Individual Contributors Get
Mentoring, Little Coaching, AMA Survey Shows” (2014). http://
www.amanet.org/news/10244.aspx