Women now lead 167 of the country’s top 3,000 companies, according to the Wall Street Journal. That number has doubled from a decade ago, but it is still under 6%. The issue lies within the pipeline that leads to the top. Though women receive promotions and fill executive seats, they’re cut off from the positions that are traditionally stepping-stones to CEO, according to the WSJ report.
The WSJ’s study found that men on the way up end up in management jobs that hinge on a company’s profits and losses. These positions that impact a company’s bottom line are typically rungs on the ladder toward CEO.
Even when women do make it to CEO, they are more likely to step down. The report said that of the 307 companies in the Russell 3000 that appointed new CEOs last year, 26 were women — and 17 of those women stepped down or were ousted.
A 2018 Network of Executive Women analysis looked at data for 400,000 employees at eight major companies. Senior women left their jobs at nearly four times the rate of men (27% vs. 7%). Women’s attrition is often directly related to the fact that they are treated differently — and face more obstacles — than men.
Oftentimes social constraints are to blame. According to interviews with two dozen company leaders the WSJ conducted, a lot of these obstacles come early on in a woman’s career. Women are at a disadvantage from the beginnings of their careers because of obstacles like work-life constraints and stereotypes concerning powerful women and traits that make a leader.
Often, companies throw women on to leadership teams erratically, more for the sake of achieving women’s representation on boards than for advancing these women’s careers. There lacks a consistent pipeline for women to become CEO, the report says.
The Hershey Company (No. 25 on Fair360, formerly DiversityInc’s 2017 Top 50 Companies for Diversity) is one of the few Fortune 500 companies with a woman CEO: Michele Buck. Under the previous male CEO, J.P. Bilbrey, Hershey began building a more deliberate pipeline for women to the C-suite. Buck began as Hershey’s marketing chief in 2005, moving on to become the chief growth officer. She subsequently took on other profits and losses roles as the head of Hershey’s North American business and then becoming the COO. She landed her CEO position in 2017.
She told the WSJ that she and her executive team reviews the company’s top 70 roles five times a year. They strategically assign important assignments to men and women in those positions and the high potentials below them. Buck is Hershey’s first female CEO, but she told the WSJ that she could easily see more in the company’s future because of the talent it is building up.
Women are typically also more likely to develop expertise in one area and move up toward leadership roles based on certain skill sets. Usually women are relegated to roles that deal with people, while men are promoted to roles that deal with the company’s bottom line, according to the report.
The climb is even more daunting for women of color. Women of color are even less likely than white women to say their bosses gave them opportunities to manage people and projects and less likely to receive guidance from higher-ups on how to navigate the corporate landscape. In a 2019 McKinsey & Company and Leanin.org study, women of color made up a sliver of C-suite roles at 4%.
A 2010 study by Amanda Sesko and Monica Biernat found Black women’s words are less likely to be remembered in meetings.
The issue is not that women inherently have different skills or less ambition. The WSJ report cited a University of Chicago and Copenhagen Business School study that found women and men were equally likely to possess the traits and skills necessary for the C-suite. Yet, women CEO candidates were nearly 30% less likely to become CEOs than their male competitors.
There’s also bias about a women’s ambition. Men are perceived to constantly striving to advance, whereas women are perceived as being content where they are. Stereotypes about women’s personal and family lives lead to biases that make people believe women lower their career aspirations when they begin families or grow older.
But in reality, according to a Boston Consulting Group study of more than 200,000 employees, 85% of mid-career women in companies that strive for diversity reported they sought a higher position — nearly equal to the 87% of men who said the same. Company culture plays a role. At companies that scored poorly on gender diversity, only 66% of women said they strove to advance their careers.