ysc insights women at the top a look back and a look to the future

Women at the top - a look back and a look to the future

YSC InsightsOriginal thought leadership from YSC

November 2010

Research

At YSC our mission is to release the power of people. We do this by combining industry leading psychological insight with a thorough understanding of our clients’ business needs. We work with clients across their entire talent lifecycles including: recruitment, induction, development, the identification of potential, internal selection, role change, measurement and departure. Our key client offerings include 1:1 and team assessment, executive coaching and organisational consulting.

Why do so few women reach the top? Rachel Short, Director in YSC’s London office, reflects on the role of women in senior leadership roles whilst also providing tips on how to make it to the top.

It’s easy to look back over the previous 20 years and note the lack of women’s progress:

· Equal pay hasn’t happened. · Representation in the boardroom remains minimal.

· Professional elites remain male-dominated.· The case for gender diversity is still hotly debated and therefore only partially accepted and acted upon.

Women start out with the same level of educational attainment[1], ambition, and commitment as men, yet comparatively few reach the top. Yet much applied research has been conducted and much has improved. We now have a better understanding of the real root causes of the gender gap at the top:

· Women opt out of routes to corporate leadership more often than men[2].

– They lose appetite for the politics at the top of large corporates[3]. Satisfaction with their positions is significantly lower than that of men[4]. Their personal values become decoupled from those of their employer and they seek meaning elsewhere.

– Work-life balance for women is a chimera – globally women leave the office to start a shift of focussed family and home management[5] before logging on as a remote, virtual worker in an effort to keep abreast of their male peers. The dual burden of management at home and at work saps energy[6].

– Notions of male-centric leadership abound[7]. A successful male leader is likely to be decisive, assertive, go-getting, ambitious, and visionary. Identical behaviours in a woman are likely to give rise to pejorative attributions, eg ‘ball-buster’, ‘queen bee’, or ‘bitch’. Women are expected to be socially and emotionally attuned, caring and concerned with others’

wellbeing. These attributes can conflict with the more overtly thrusting, competitive and individualistic leadership characteristics.

– Structural hurdles remain intact. The glass ceiling[8], glass escalator[9], and more recently the glass cliff[10], are real phenomena. Appointing women into high profile leadership roles is the exception to the norm and therefore viewed as a risk. Women are promoted to CEO often when there is little left to lose, ie in highly precarious circumstances.

– Exclusion from professional networks. An aspiring female leader will have to manage more complex interpersonal dynamics to navigate acceptance by a senior, often older and mainly male network. Frequently, its easier to stick with what feels familiar. However, all women networks are no panacea - typically women find that their female colleagues are not as influential as male equivalents.

– Less success in leveraging networks. Men tend to build broader, shallower networks that give them a wider range of resources for gaining knowledge and provide access to more professional opportunities[11].

– Out of sight and out of mind – women fail to promote their own interests and don’t speak out. Whether the result of early social conditioning[12] or a belief that deep competence is required to add value, women tend to minimise their own contribution to success[13], hold back from putting themselves forward for promotion, and even feel constrained in contributing to board discussions.

– The price of success is high – on average, the higher women climb up the corporate ladder, the fewer children they are likely to have, whereas the reverse is true for men[14].

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YSC Insights: Women at the top – a look back and a look to the future

Women have to make a conscious choice to prioritise their career over their family. The same choice does not have the same consequences for men.

Macro socio-economic changes mean we are also clearer as to why the gap matters:

– The war for talent continues – Europe can expect to see a shortfall of 24 million people in the active workforce by 2040. Businesses need to draw on the widest possible talent pool.

– Fostering a better understanding of customers – women represent an increasingly large part of the consumer market with a major influence on purchasing decisions[15].

– Promoting collective learning. There is some evidence of group-think on homogeneous boards comprised of those individuals who share the same background and experience. Recent very public corporate mishaps, eg RBS’ take-over of ABN Amro, could arguably have benefitted from traditionally viewed female insistence on ‘celebrating mistakes’ and less tolerance for empire-building behaviours.

– Better corporate governance is strongly linked with the presence of women on the board[16]. Men learn to communicate using direct, confrontational speech. Women learn to maximize intimacy and minimize conflict. A blend of both is necessary for effective problem-solving[17].

– Organisational competitiveness[18].

– In 2009 market capitalisation for those FTSE 100 companies with women on the board was significantly higher, they did not have significantly larger workforces[19].

– In Europe, companies with more women on management and supervisory boards produced an ROE of 11.4%, against 10.3% for a comparator group. Where women were well represented on boards, profits grew 11.1%, against 5.8% for the comparator group[20].

– Succeeding in turbulent markets. ‘Think crisis – think female’[21] has become more commonplace in the recent global financial crisis. Women leaders appear to be more risk-averse and to focus more on a long-term perspective[22]. Certainly there has long been evidence that they engage more in ‘emotional labour’, which a crisis entails.

Thus, although “this is a man’s world”, the view for women in the next 20 years is more hopeful:

1. The law of supply and demand will kick in. The world will have an increasingly urgent need for female leaders. In some emerging countries the gender imbalance will put a premium on females per se, both as potential wives and mothers, but also as champions of female-friendly products, services and organisational cultures. In the developed world, societal shifts and legislative pressures mean organisations will be forced to address their recruitment biases for senior level positions. Nominations committees will be fishing in a small and increasingly competitive pool of candidates unless they start to develop their own emerging female talent for boardroom responsibility.

2. The ‘female’ model of leadership will pre- dominate. The need for connectivity, meaning and emotional intelligence in our corporate leaders will begin to outstrip the need for authoritative, directional and macho leadership. As the globalised and IT-mediated world of business becomes increasingly difficult to navigate, the boundaries between supplier and consumer more fluid, the supply chain more complex, sources of competitive advantage harder to maintain, and organisations more networked –women’s traditionally perceived areas of strength – enrolment of others, engagement, communication, and common sense - will come to the fore as critical leadership capabilities.

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3. Social equity will become a key driver of legislation. Almost all European countries now have some form of affirmative policy enshrined in their legislation. The EU is considering hardening its approach to gender diversity for member states. Spain and Norway have already taken the initiative in setting quotas for women at the top.

4. A critical mass of senior female leaders will level the playing field and may also change the game. Equity in status through more equal representation at senior levels will lead to greater levels of trust and improved social relations [23].The notion of leadership as ‘male gendered’[24] will fade from consciousness. Generations of children will grow up in households with a woman as the primary breadwinner. Social expectations and norms will shift. Women will continue to take time out of the workplace to perpetuate the species. However, the career ‘penalties’ they have historically paid will slowly but surely cease to exist.

Key research findings from YSC’s external benchmark database:

– Women are seen as more driven and better at influencing than men but they are rated lower on judgment.

– Women’s ratings vary considerably with age, with those in the 40-49 age bracket getting the highest ratings far in excess of their male peers.

– Men score higher on Functional Strength and Breadth of Experience then women. Men are also more likely to have had international experience.

– Women are seen as more promotable and having higher overall potential.

YSC’s top tips for women to beat the system

• Broaden your horizons – see the world. Early on in your career, make sure you have an international posting under your belt before family commitments anchor your career to

one place for a number of years. A number of the 13 new FTSE100 first time female Directors in 2009 were overseas nationals. All had international management experience.

• Get up and go before you feel ready. Don’t expect your results to speak for themselves. Don’t only put your hat in the ring for promotion once you are sure you can succeed at the next level. Men will put themselves forward with only a 50% assessment of their skills for success whereas women tend to wait until they have at least 80% of the requisite skillset for the role.

• Once you are over 40, start planning your exit. Your chances of promotion are likely to be increased as an external candidate. Women CEOs were nearly twice as likely as men to have been appointed to the job from outside the company.

• Watch your figure(s). Get a good grounding in Finance. Three of the thirteen new FTSE100 first time female Directors in 2009 were appointed as Finance Directors. Women are consistently rated lower on commercial judgement in YSC’s database. They tend not to use hard commercial data to demonstrate their achievements.

• Get out more. You need to be serious about networking to stay abreast of your male counterparts. YSC’s psychometric research suggests that networking should be an area of strength for women. Source yourself a senior mentor and use him/her to introduce you to other senior leaders. This is not about self-promotion it is essential groundwork for learning the rules at the top.

• Manage your profile – Female leaders in all walks of life are judged on their appearance more than their male counterparts. Don’t allow your wardrobe or personal grooming to do all your talking for you. Think Angela Merkel or (French Finance Minister) not Carla Bruni. When male CEOs outline their strategy, generally no one’s critiquing their choice of tie.

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YSC’s Top tips for organisations to hothouse senior female leaders

We have a growing evidence base about the success of various interventions to promote women’s chances of making it to the top:

· Provide mentoring for your junior female talent from senior leaders[25].

. Make sure your junior female talent gets a succession of great female line managers early in their career. Role-modelling is incredibly important for engagement and aspiration.

· Really engage your senior female talent in roles and projects that feel meaningful for them – or they will walk. This will create a depleted talent pool just below main board level. Hiring in female talent at main Board level will further deter your remaining female talent from staying around for promotion.

· Enable flexible working – women want to work on their own terms and in an environment that allows them to complete tasks alongside other conflicting priorities. Measure their levels of engagement regularly and listen to their ideas for improvement.

· Encourage mobility (functional and geographic) in early career. YSC’s research confirms that both international experience and P&L responsibility are key building blocks to success in later career. Make it easy for your female leaders to explore options without losing their way.

· Put your money where your mouth is. Don’t make pious statements in the Annual Report and Accounts about the organisation’s commitment to diversity if the reality doesn’t marry up. Don’t massage the statistics. If they don’t look good, start doing something different.

Footnotes

[1] Women account for 55% of university graduates in Europe1, they are a smaller part of the labour market: their employment rate is 21% lower than that of men2. – Women matter, McKinsey, Women’s Forum for the Economy & Society. 2008

[2] “The Hidden Brain Drain - Off Ramps and On Ramps in Women’s Career”, Sylvia Ann Hewlett, Carolyn Buck Luce, Peggy Schiller, HBR Research Report, Harvard Business Review 83 (March 2005): 31-57

[3] Women in the Boardroom: A Birds Eye View. A Change Agenda. CIPD.

[4] Lyness, K.S. and Thompson, D.E. (1997) Above the glass ceiling? A comparison of matched samples of female and male executives. Journal of Applied Psychology. Vol 82, No 3, June. pp359–375.

[5] “92 % of executives still manage all household tasks, such as meal preparation and child care” McKinsey Centred Leadership Article, 2008

[6] McKinsey Report – Centred leadership: How Talented Women Thrive. SEPTEMBER 2008 • Joanna Barsh, Susie Cranston, and Rebecca A. Craske

[7] A number of studies have shown that women who promote their own interests vigorously are seen as aggressive, uncooperative, and selfish. Eagly et al, Sylvester

[8] The Wall Street Journal coined the phrase ‘the glass ceiling’ in its 1986 special report on the corporate woman,

[9] Williams, C.L. (1992) The glass escalator: hidden advantages for men in the ‘female’ professions. Social Problems. Vol 39, No 3, August. pp253–267.

[10] CIPD reference

[11] McKinsey Report – Centred leadership: How Talented Women Thrive. September 2008 • Joanna Barsh, Susie Cranston, and Rebecca A. Craske

[12] Developmental psychological research on the degree of social interaction for baby boys vs baby girls.

ROBERT, L.E. and TINGLEY, J.C. (1999) Gendersell: how to sell to the opposite sex. London: Simon & Schuster Ltd.

TINGLEY, J.C. (1994) Genderflex: men and women speaking each other’s language at work. AMACOM.

[13] Koscwara & Sylvester research.

[14] In the 41–55 age range, for example, 49% of the “best paid” women (over $100,000 a year) are childless (compared to 19% of men), while the figure for “well paid” women ($55,000 to 65,000 depending on age) is 33% (compared to 25% for men). “Executive Women and the Myth of Having It All”, Sylvia Ann Hewlett, Harvard Business Review 80 (April 2002):, 66-73

[15] 83% of consumer goods purchases in the US are made by women.Think tank: marketing to women”, by Peter Crush

[16] The 2004 Female FTSE Report, Cranfield School of Management

[17] CAMERON, D. (1992) Feminism and linguistic theory. 2nd ed. Basingstoke: Macmillan

[18] Groundbreakers: Using the strength of women to rebuild the world economy, Ernst & Young report to Davos in January 2009., “There may be no quick fix to the current financial crisis, but a sure-fire, long-term resolution is to advance more women into leadership positions and provide the right environment for new perspectives to be heard. The evidence is clear that doing this improves corporate performance – and the numbers prove it.”

[19] The Female FTSE Board Report 2009, Dr. Ruth Sealy, Professor Susan Vinnicombe OBE and Elena Doldor, International Centre for

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Women Leaders, Cranfield School of Management

[20] Women Matter: Gender diversity a corporate performance driver (2007)

[21] Ryan, M. K., Haslam, S. A., Hersby, M.D., & Bongiorno, R. (in prep). Think crisis–think female: Using the Glass Cliff to reconsider the think manager – think male stereotype. Manuscript in preparation: University of Exeter.

[22] Michel Ferrary, Ceram Business School, France, 2009

[23] The Spirit Level – Why equality is better for everyone, Richard Wilkinson and Kate Pickett – Penguin, London 2010

[24] Eagly & Karau, 2002;

[25] McKinsey Article, 2010

[26] Global Employment Trends for Women 2004, International Labour Office.

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is a series of thought leadership pieces that include points of view, case studies, client interviews, original research and commentary. The series is produced in-house by YSC’s Business Psychologists and Research Consultants. For further details please contact [email protected] and for questions concerning syndication/reproduction of content please contact [email protected].

YSC Insights

Rachel Short is a Director based in YSC’s London Office. For further details please contact us on Tel: +44 (0)20 7520 5555 / Email: [email protected]

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