May 28, 2012
Boards of directors remain male-dominated
Why aren’t there more women at the very top of the corporate ladder?
Nationally, just 16.1 percent of the directors of Fortune 500 companies last year were women, according to a study by Catalyst, a New York City-based nonprofit that advocates for better opportunities for women in business. That statistic is slowly creeping up, but women who were fighting for equal rights and equal representation decades ago thought there would be more gender parity by 2011.
“I don’t think anybody’s happy with that,” says Rebecca Harris, director of the Center for Women’s Entrepreneurship at Chatham University.
Catalyst also looked at the profitability of businesses and found that those with three or more women on the boards of directors did better in terms of return on sales, return on invested capital and return on equity than companies without women on their boards.
“The data show that companies that have women on their boards and women executives do better,” Harris says. “This isn’t just an exercise in diversity, this is an exercise in doing better business.”
Sandi DiMola, an attorney and the director of the Center for the Study of Conflict at Chatham University, says that having a token woman on the board of directors is not enough.
“It presupposes that when you get that one woman in she’s going to bring other women in, and maybe you can’t presuppose that,” she said.
What the past has shown is that many women who achieve board of directors status do not pull other women up behind them, but when there are three women on the board they are more comfortable bringing the issues that affect women, who are often the company’s customers, to the fore.
Candice Morgan, the director of advisory services for Catalyst, says that there are a number of reasons women do not rise in business, the first of which is that they lack role models or other women above them who have done it before.
Another reason is they lack the access to the unspoken network that many men have, such as similar interests in sports or activities that can build camaraderie between a boss and subordinates. Often women don’t relate to those interests so they may not have as much in common with the boss.
And a third issue, Morgan said, is women are still stifled by gender-based stereotyping that may label them as either too tough or aggressive. Conversely, if they are nice, they may be perceived as incompetent.
Harris says that women are doing better in some places, such as in newer industries in the northern California technology hub. She pointed to Hewlett-Packard, where Meg Whitman is now the CEO, and Facebook, where Sheryl Sandberg is the COO. Both women are in Silicon Valley in technology industries rather than the traditional Rust Belt industries of chemicals, steel and coal.
Heather Arnet, CEO of the Pittsburgh-based Women and Girls Foundation, says that a promising trend is investor advocacy, such as Pennsylvania state Treasurer Rob McCord’s move to use Pennsylvania’s proxy votes to vote against boards of directors that do not contain women.
She notes that while just six years ago, 26 Pittsburgh companies didn’t have any women on their boards of directors, last year it was down to 12.
Despite the generally dismal numbers of corporate female leadership, DiMola says that many younger women in her classes think the fight for women’s rights has been resolved.
“When you teach young women, they think the women’s revolution is over,” she says.
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