Even though C-suite diversity as a topic has received much attention in recent years, it is no secret that the number of women in leadership roles continues to be abysmally low. According to a recent study by YesStyle, while women have increased their presence in higher-paying jobs traditionally dominated by men, there’s still a wide gender disparity in most workplaces, particularly among C-suite positions (CEO, CFO, COO, CIO etc).
The sectors with the most gender diversity are typically healthcare and finance related, with technology close behind, shows the study. A shocking finding shows that even retail that has historically been a female-dominated industry, doesn’t show among C-suite positions.
The study shows, 18 of 100 companies have zero female staff members in C-suite positions. Out of these companies, five belong to the energy sector and five belong to the industrial sector, both of which have been and continue to be male-dominated industries.
The tech industry woes
In the technology sector, while IBM scored high in C-suite diversity (at the time the study was done), the sustainability in the coming months is doubtful, especially with the exit of Virginia Rometty, who had been IBM’s Chairman, President and CEO. This now leaves just 34 female CEOs among Fortune 500 companies, many of whom underperform on the gender-balance front, as per a CNBC report. Take Apple, for instance, where just 33% of the staff is female. When it comes to leadership positions, this figure drops to a mere 29% at the Cupertino-based phone maker.
Facebook, which has often made chief operating officer Sheryl Sandberg the face of its brand, realigned its executive teams in May 2018 now comprise mostly white males in roles overseeing products and engineering. Google fares a little better. Although the internet giant’s workforce is 70% male, its management team, with 46% women, is among the most gender-equal, according to a report.
Only 28% of Silicon Valley startups have female founders, which again shows that the lack of women in senior roles stems from their dearth among entrepreneurs, experts say.
The real challenge
Despite women earning the majority of college degrees and making up roughly half the workforce, the question that comes to mind is, why so few occupy the chief executive job? An article from the Wall Street Journal explains that the barrier isn’t only a glass ceiling at the very top, but also an invisible wall that sidelines them from the kinds of roles that have been traditional stepping stones to the CEO position. For example, female leaders continue to face societal and self imposed biases which can cause them to further avoid stepping up the career ladder.
This explains why men on the way up overwhelmingly get the management jobs in which a company’s profits and losses hang in the balance. Responsibilities, such as heading a division, unit or brand, are what set executives on the CEO track. Women promoted into C-suites on the other hand, often fill roles such as head of human resources, administration or legal. Though important functions, the jobs don’t have profit-generating responsibility, and are rarely a path to running a company.
The irony is that studies have also confirmed that companies with female leaders often perform better on the stock market than those led by men. A report published by S&P Global said for every female CEO in the US there were 19 male chief executives, and the two years following a new CEO appointment, the stock price for companies that appointed female chief executives outperformed those that appointed men by an average of 20%.
Another report from Credit Suisse that analyzed data from 3,000 firms around the world also showed that companies with more female management had higher levels of profitability and performed better on the stock market.
The need of the hour
Ensuring that women get a fair voice in the C-suite is indeed a complex process. But following best practices such as building sponsorship networks for women, giving them the right exposure and skills to climb higher up and including more men into these conversations can help in welcoming more women in the C-suite.
One success story we can learn from Michele Buck, the first female CEO of Hershey is that throughout her career at Hershey, she was entrusted with a series of critical assignments. Michele emphasizes on systematically building a female talent pipeline to the C-suite. According to a Wall Street Journal article, under her male predecessor, J.P. Bilbrey, Buck and her executive team reviewed the top 70 roles in the company. They discuss what career-critical assignments the men and women in those positions should take on next to move higher, including by getting P&L experience.
Finally, organizations supporting women in their roles as sponsors and mentors have indeed done better from time to time. As Sandy Carter, Vice President at Amazon Web Services said, “When you advance, reach behind you and take another woman’s hand. Bring her with you.” After all, when women advance, everyone benefits.