Advancing Women: Where We Stand Today

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Advancing WomenWhere We Stand Today

• Janice Fanning Madden
• Professor, The Wharton School
• University of Pennsylvania

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• Gender Differences
• Glass ceilings, glass walls, pay gap
• Causes of Gender Differences
• Discrimination dislike or stereotypes (implicit
  bias)
• Family-career tradeoffs employees vs. workplace
  design
• Eliminating Gender Differences
• What works in company policies
• What women executives can do

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• Glass Ceilings

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More recent data, Fortune 500?
Includes more than the top 5 executive positions
(prior slide), ranging from 7 to 50 per company,
and fewer firms that are larger.
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More recent data, Fortune 500?
Includes more than the top 5 executive positions
(prior slide), ranging from 7 to 50 per company,
and fewer firms that are larger.
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US Census Data on Percentages of Managers,
Executives, CEOs who are Female
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US Census Data on Female Managers, Executives and
CEOs
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Percentages of BAs, Business BAs, and MBAs
Awarded to Women, 1970-2008
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The Glass Ceiling

• Underrepresentation of women increases going up
  the management hierarchy
• Progress in women attaining senior management
  positions appears to have stalled since about
  2000
• except among Fortune 500 CEOs
• As of 2012, 18 women CEOs, but only 4 in 2004 and
  2 in 2002.

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• Glass Walls

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Glass Walls

• Women executives are more likely to have
  professional or non-line (finance, law) than line
  (president, CEO, COO) executive positions.
• Also, retail trade companies have more women CEOs.

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• The Pay Gap

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Women Earn Less Than Men

• Women in the top 5 executive positions earned 22
  less total compensation (annual salary plus
  incentive pay) than men, although their annual
  salaries were only 11 less than mens.
• Most, but certainly not all, of the gender gap in
  incentive pay arises from women being in smaller
  firms (measured by market evaluation and
  employees) and in different job titles.

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• WHY?

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• Discrimination
• Men dislike women managers
• Stereotypical notions (implicit bias) that women
  lack skills decisiveness, leadership, etc.
• Family and career tradeoffs
• Accommodating family demands
• Workplace design24/7, no time away, the rat
  race

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• Discrimination

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Discrimination, which is it Dislike of working
with women or stereotype that women are less
qualified

• 2003 SEC regulation said that corporate boards,
  not company insiders, set compensation
• If dislike, gender pay gap decreases after 2003
• If stereotype, gap grows after 2003 (because
  boards have no direct ways of discovering
  ability, rely on stereotype)

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Discrimination, which is it Dislike of working
with women or Stereotype that women are less
qualified

• 2003 SEC regulation said that corporate boards,
  not company insiders, set compensation
• If dislike, gender pay gap decreases after 2003
• If stereotype, gap grows after 2003 (because
  boards have no direct ways of discovering
  ability, rely on stereotype)
• Gender pay gap grew 19 on average in companies
  who were affected by regulation, suggesting that
  stereotypes are the problem.

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Discrimination, is it Dislike of working with
women or Stereotype that women less qualified

• Another study found that stocks decreased 3 on
  average with appointment of new female CEO, but
  only 0.5 for new male CEO
• No gender difference in change in stock value
  over time between firms with male or female CEOs
• Women often appointed CEO when firm performance
  is in decline, glass cliff phenomena Patricia
  Woertz at Archer Midland Daniels, Susan Ivey at
  Reynolds American, Brenda Barnes at Sara Lee,
  Anne Mulcahy at Xerox, Mary Sammons at Rite Aid

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Discrimination, is it Dislike of working with
women or Stereotype that women less qualified

• Research supports implicit bias as the
  discrimination source of gender disparities in
  labor market outcomes.
• Implicit bias occurs when learned stereotypes
  operate automatically or subconsciously in
  decision making our brains automatically map
  people into categories. This behavior is strong
  and pervasive gender categorization occurs for
  men and for women taking the test.
• See https//implicit.harvard.edu/implicit/demo/

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Discrimination

• Discrimination appears more likely to be based on
  stereotypical thinking, or implicit bias, then on
  dislike of women in management.
• Stereotypes are better than dislike as a cause of
  discriminatory behaviors, because it is easier to
  correct misunderstandings and reduce implicit
  bias through education and increasing awareness
  than it is to eliminate hatred.

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• Family/Career Tradeoffs

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Family/career tradeoffs

• Women provide more house and family care than
  men.
• Often, there is hostility at the workplace toward
  time off for parental responsibilities, as well
  as for flexible time schedules.
• Media has reported extensively, and inaccurately,
  on increasing tendencies for educated women to
  opt out of demanding jobs for more family time.

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Family/career tradeoffs

• Women are more likely to take time off.
• Women MBAs work
• fewer hours per week (goes from an average
  deficit of 1.8 to 6.5 hours as experience goes
  from entry to greater than 10 years)
• more likely to have taken some time out since
  graduation (less than a years gender difference
  over a career)
• Lead to large earnings penalties for men and
  women.

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Design of Workplace

• How should less hours or time off affect
  career?
• Would workplace norms be different if womens
  lifecycle needs were the basis of the companys
  norms for promotion?
• Obviously earn less if work less, other things
  being the same.
• But should fewer hours or time off when one has
  young children mean derailment of career, as
  opposed to delay?

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• What Companies Can Do

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What matters in increasing women in management

• AA Plan
• Diversity Committee
• Diversity Staff/ in-house attorney
• Networking Programs
• Family accommodations
• Having been sued for discrimination or have a
  compliance review from US Dept of Labor
• Having women in top management
• (Kalev, Kelly, Dobbin, ASR 2006)

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What does not matter in increasing women in
management

• Diversity training
• Mentoring programs

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• What Women Executives
• Can Do

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Women CEOs Matter

• In companies with a woman CEO, 11 of top
  executives (excluding CEO position) are women
  for the other firms, only 5 are women.

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Women CEOs Matter

• In companies with a woman CEO, 11 of top
  executives (excluding CEO position) are women
  for the other firms, only 5 are women.
• Women CEOs double the representation of women in
  top executive positions!
• And, these women earn more when there is a woman
  CEO.

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Women CEOs Matter Why?

• Sponsorship/mentoring
• Women-friendly policies at firms
• Selection higher achieving women select firms
  with women CEOs, or women have an advantage in
  some industrial sectors.

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Women CEOs Matter Why?

• Sponsorship/mentoring
• Women-friendly policies at firms
• Selection higher achieving women select firms
  with women CEOs, or women have an advantage in
  some industrial sectors.

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• Women slightly more likely to be mentored (83 v
  76)
• Women get less benefit
• 72 of men, but only 65 of women with active
  mentor relationships in 2008 were promoted by
  2010.
• Women need sponsors, not mentors

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Sponsors

• Senior managers with influence
• Give protégés exposure to other execs who will
  help careers
• Make sure protégés get challenging opportunities
  and assignments
• Protect protégés from damaging contacts with
  publicity or senior execs
• Fight to get protégés promoted.

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• Recent study shows that the number of currently
  influential people an executive has previously
  encountered in career increases mens, but not
  womens, compensation.

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Conclusions

• Women face a glass ceiling and glass walls in
  highest level management.
• Women in highest level jobs earn less due to jobs
  and to the types of organizations they manage.
• These outcomes are due both to discrimination
  and family demands.
• Discriminatory behavior based on implicit bias,
  which can be managed and alleviated.
• Career effects of family demands probably greater
  than they need be if organizations reconsider how
  norms and talent identification programs are
  designed.

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Conclusions What Companies Can Do

• AA Plan
• Diversity Committee
• Diversity staff/ in-house attorney
• Networking programs
• Family accommodations
• Rethink norms and benchmarks for promotions
• Women in top management

Deals with implicit bias
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Conclusions What Women Can Do

• Senior executives
• Give protégés exposure to other execs to help
  careers
• Make sure protégés get challenging assignments
• Protect protégés from damaging contacts
• Fight to get protégés promoted.
• Aspiring to move up the executive hierarchy
• Find a sponsor who does the above for you