Someone once told me that politics and business don’t mix.
I agree. Hence, I am going to be as objective as possible in this post.
I read the November 2016 edition of HBR with interest and have to admit that it took about 10 minutes for me to clock that the faces on pages 46 and 47 in “The best performing CEO’s” list were overwhelmingly, predominantly male.
Debra Calfaro tops number 43 and Marillyn Hewson number 51. Don’t get me wrong, there are plenty of other groups missing too. Alaypal Banga is at number 64. A lone ranger by the looks of it.
So the world’s top companies are mainly run by White Men over the age of 45. I guess there are no surprises there. But the question I am really interested in, is why.. when women make up around 50% of the world’s potential workforce are they only making up 2% of the top CEO list?
One potential answer might be that there just aren’t as many women at work.
But that just isn’t true!
If we look at the worldwide female workforce there has been a decline since 2005. But it was already pretty high. Women’s worldwide participation went from 52% in 2005 to 50.2% in 2012.http://bit.ly/2i1eptj
So why has it declined so dramatically?
The US has an interesting history on this..
“Women’s labor force participation was driving the overall upward trend in labor force participation through 2000, so the plateau and then decline in women’s participation in the ensuring years is an important factor for explaining the national trend. ..In 1990, the United States had the sixth-highest female labor force participation rate amongst 22 high-income OECD countries. By 2010, its rank had fallen to 17th. Why have other high-income countries continued their climb while the United States has stalled? Research by economists Francine Blau and Lawrence Kahn suggests that the absence of family-friendly policies such as paid parental leave in the United States is responsible for nearly a third of the U.S. decline relative to other OECD economies. As other developed countries have enacted and expanded family-friendly policies, the United States remains the lone developed nation with no paid parental leave.” http://bit.ly/2gDjCKi
43% of CEO’s on the list are from the United States. So, there are 43 slots available to women there. But guess what? Women take up 2 of them.
The only two female slots for top HBR CEOs are occupied by women from the USA.
The USA. Where they also suffer a larger than average struggle to juggle family and career.
So the plot thickens.
I am no statistician and the sample is small, so I will not try to deduce anything from these numbers. All I can give is my thoughts on the matter.
Maybe we can find the answer by looking at the lives of these two women.. http://nyti.ms/2gNlAUY. Debra Calfaro was not born with a silver spoon in her mouth. Her father was an entrepreneur out of necessity. She has taken a company on the edge of bankruptcy from $217 million in equity and $1.1 billion in debt in 2000 to $5.9 billion in equity and $3.5 billion in debt today. No mean feat.
I bet you are thinking she has no kids.
She has two.
Marillyn Hewson has much in common with Debra Calfaro. http://bit.ly/2hTQAri
Although born to a middle class family, her father died when she was young, “She was born in the middle-class family as the eldest of three daughters and two sons. Her father’s death at her early age burdened the little girl with the responsibility to take care of her younger sisters and assist her single mother in every possible way.”
She has two children.
These women haven’t sacrificed their roles as mothers to get where they are. However, another thing they have in common, is gumption. Both women have been used to fighting adversity from an early age and they aren’t scared of hard work either.
Don’t get me wrong. I’m not saying the men on the list didn’t work hard. They had competition too. I’m sure when they had kids they had sleepless nights and a tough time.
But the numbers are intriguing don’t you think?
So what IS the reason for this statistical anomaly? Why did the only women that made it into the top 100, make it, despite the unsupportive family policies of their environment?
There are no obvious answers but it could be one of the following:
- Although the USA has unsupportive public family policy, it also harbours a culture of inclusion and ambition. Hence, there is always a place for one or two heroes (or heroines) to make it. Note that Alaypal Banga (no. 64) is based in the US too although he was born in India.
- The unsupportive policies of the US mean that women cannot afford to throw themselves whole-heartedly into stay at home motherhood as they do in Europe (having 1yr off on maternity leave for example). They also don’t get a chance to get a taste for it. Perversely, I would argue that the unsupportive family policies of the USA actually put women on a par with men rather than work against them simply because they have less choices than their counterparts in Europe. In for a nickel in for a dollar.
These are just theories I have. I am happy to hear arguments against them.
Interestingly, another HBR article has found that women CEO’s tend to be insiders more often than their male counterparts. (i.e. Working their way up rather than across)..
“The consistent theme in the data is that steady focus wins the day. The median long stint for these women CEOs is 23 years spent at a single company in one stretch before becoming the CEO. To understand whether this was the norm, we pulled a random sample of their male Fortune 500 CEO counterparts. For the men in the sample, the median long stint is 15 years. This means that for women, the long climb is over 50% longer than for their male peers. Moreover, 71% of the female CEOs were promoted as long-term insiders versus only 48% of the male CEOs. This doesn’t leave a lot of time for hopscotch early in women’s careers.” http://bit.ly/1smI4dD
This still leaves us with the question at the start of this article..
“Why are there only 2 women listed in HBR’s top 100 CEOs this month?”
A summary of the facts so far..
- Only 2% of the top CEO’s as chosen by the Harvard Business Review are female.
- Neither made the top 40.
- The ones that did make it into the top 60 both had children. Perhaps disproving the motherhood theories?
- Both women live, work and were born in the United States. Perhaps suggesting a unique environment in the USA.
- Both women faced early life challenges which one could argue single them out as ‘survivors’ in tough circumstances.
- There are no women represented from any other country despite the highly supportive family policies of places such as Europe.
- Female CEOs have to stay at a company 50% longer than their male counterparts to end up as CEO.
Potential reasons for the 2% outcome..
- HBR are sexist in their selection? (note they have been specific about the criteria so I doubt this)
- Are women just simply bad at being CEOs?
- Is the CEO role better suited to the male psyche?
- Are women too busy having children to work up to the level of CEO?
- Do women neglect to apply for the role of CEO for some reason?
- Is the CEO role too tough for women?
- Are women treated unfairly when applying for the CEO position?
- Do women generally shun the CEO role due to personal preference?
- Is the CEO role incompatible with family commitments?
- Do pro-family policies contribute to a lower participation of females at top levels of business?
- A bit of everything above?
Answers on a post card please..
About the author
Steph is CEO and Founder of www.magicmilestones.com. She is interested in the economics of female participation in the workplace. Steph has had a positive experience throughout her career but believes that women face unique challenges in their careers. This is not necessarily a problem to be solved but a problem to be understood.