Women represent only a small percentage of leadership positions in large companies worldwide. In Portugal, only one PSI20 company has a woman as executive director; in the UK, only eight of the top 100 companies are led by women; In the US, only 32 of the top 500 companies have women as CEOs.
These numbers would not be worrisome if this extreme discrepancy were explained by women finding top positions less attractive or more difficult to reconcile with other areas of their interest when compared to men. However, even though women can voluntarily exclude themselves from top management because, for example, they are, on average, more risk-averse or less fond of competition than men, I believe that, if we only focus on these types of arguments, we forget an essential part of the causes of this massive difference at the top of large companies.
Part of why women rarely make it to CEOs is that they are generally treated unfairly in their careers. Several studies find that women are less likely to be promoted than men with similar qualifications and performance. A meta-analysis based on more than 140 studies concludes that women have been able to close the performance gap, but this did not translate into closing the rewards gap: the sex differences in rewards, such as promotions, were 14 times larger than sex differences in performance evaluations. The fact that this discrimination occurs from the lowest to the highest career levels means that, when choosing the new executive director, significantly fewer women are available and able to be selected for the position.
Furthermore, the work distribution among men and women may have direct implications for the progression of women within organizations. A study that looked at differences between men and women in the work they were assigned found that women are significantly more likely to be responsible for domestic office work (for instance, taking notes during a meeting or organizing a company event). Conversely, men are more likely to get glamorous work (for example, developing a project for an important client or being responsible for building a new team). The latter is more easily noticed and contributes more actively to progression. The authors argue that this difference in work allocation is not explained by women’s preferences: when the authors asked the same workers if they were satisfied with the amount of glamorous work they had, women were more dissatisfied than men. More generally, there is evidence that women are more likely to take responsibility for those tasks that everyone prefers to be done by someone else, such as drafting a report or serving on a committee. This study finds evidence that men are less likely to volunteer, to be asked to volunteer, and to accept requests to volunteer for tasks associated with low promotability.
Finally, hiring also seems to be part of the problem. There is substantive evidence that women are disfavored in accessing more prestigious male-dominated jobs. A recent study found that female candidates are less likely to be contacted and interviewed for top management positions by executive search firms. Furthermore, there is evidence suggesting that recruiters are more skeptical about women’s leadership ability. They require women to show more robust human capital (e.g., more knowledge or skills that can contribute to organizational success) even to be considered for a senior role. In general, women find it more challenging to be hired, which may make them exit talent pipelines at higher rates than men and not apply for high-ranked positions. This study shows that when women are more discriminated against and rejected when they apply for a lower position in an organization, that subsequently diminishes their willingness to apply for higher positions in that same organization.
Legislative measures that force a certain percentage of women into top management positions in large companies, such as the one recently approved by the European Parliament, can significantly reduce this problem in the medium and long term. However, even though evidence shows that having women in senior positions reduces gender stereotypes inside organizations, there is also evidence for what is commonly called negative gender spillovers. The existence of one woman in the top management team may substantially reduce the likelihood of other women occupying a similar professional position just because the firm signals “enough” commitment by having one woman in those positions.
In the short term, we must all (individually and collectively) take an active role in ensuring that the organizations we interact with promote fairly, allocate work correctly, and do not discriminate when hiring. Only in this way can we ensure that women reach the top of large companies.
Have a great and impactful week!
João Cotter Salvado
Assistant Professor of Strategy and Entrepreneurship
Católica Lisbon School of Business & Economics
This article builds on an article published by the author in Observador.
This article refers to edition #169 of the "Have a Great and Impactful Week" Newsletter and covers SDG 5 and 20.
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