Scholars and practitioners have long argued that females exhibit a distinctive and particularly effective managerial style. Yet, less than a third of the largest U.S. corporations have a single female senior executive, raising the question of whether women are in fact effective as senior managers, and, if so, under what circumstances.
In the past few decades, women have made great strides in their involvement in economic activity, moving ever closer to what one might call “gender equality.” Women’s college participation and graduation rates exceed those of men, and more and more women are pursuing “traditionally male” college majors, particularly in professional fields such as law and medicine. However, discrepancies persist in the field of business administration, and this state of affairs is mirrored in the workforce: the proportion of women in managerial occupations is only about 35%.
This research shows that the number of women on a company’s board of directors impacts the future of women in its senior leadership. This is significant because earlier Catalyst findings show that Fortune 500 companies with the highest representation of women board directors and women corporate officers, on average, achieve higher financial performance than those with the lowest. The numbers tell the story—a gender-diverse board promotes continued success for women and for business.
Evidence of a link between the bottom line and women at the top is growing, with McKinsey research showing better-than-average financial performance by European companies with the highest performance of women in influential leadership roles. The report, launched at the Women’s Forum for the Economy & Society in Deauville, France, finds these companies do better than their sector in terms of return on equity, operating result, and shared price growth.
Reducing gender inequality could play a key role in addressing the twin problems of population ageing and pension sustainability. In countries where it is relatively easy for women to work and have children, female employment and fertility both tend to be higher.
The Michigan Women’s Leadership Index (WLI) is a data-based instrument used to measure the presence of women executives in the highest leadership positions of the top 100 publicly-held companies headquartered in Michigan (Index 100). Research shows that women directors’ and women executives’ presence and advancement are independent of one another, and that there is more hope for increasing the number of women executives than increasing the number of women board members.
Recent events capture not only the impact of prejudice, but also the need to look closely at what is going on in the labor force and talent pool, where lack of opportunity is felt by non-whites and women from the very bottom on up to the very top rungs of power: white men are 95 percent of the CEOs of Fortune 500 Companies, 92 percent of the top earners. In 2006, only one Fortune 500 CEO is a minority woman.
The increased representation by women among corporate boards continues a trend that has been present for several years; however, women still lag far behind their male counterparts. Both established women directors and those seeking board seats for the first time revealed in the survey that they still find themselves fighting an uphill battle for equal representation.
Does it matter to corporate governance whether women serve on a board? If so, does it make a difference how many women serve? Is there a critical mass that can bring significant change to the boardroom and improve corporate governance?
Starting, funding, and growing a new venture are significant challenges for every entrepreneur. For women, the hurdles are even higher, due to widely held perceptions about them, their capabilities, and their businesses. Now, five leading experts on women dedicated to achieving success and claiming the rewards.