Tag Archives: golden skirts

Women ‘blocked from boardrooms’…………..really?

Kindadukish's Blog - I am not a number, I am a free man (The Prisoner)

Nearly one in five women believe it is almost impossible for a female to reach a senior management role in business, according to a report. In a survey of 2,000 working women by communications giant 02, half replied that all the decision-makers in their company were male.

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A review into diversity has recommended that 25% of company boards should be made up of women, but the report said progress towards meeting the target was not moving fast enough.

More than a quarter of those polled said they dreamed of becoming a chief executive, but a third said they had failed to meet their career expectations, blaming poor quality line management, a lack of training and negative office politics.

Women said good luck often led to success in business, rather than skill, ambition or determination. Ann Pickering, O2’s HR director and board member, said: “As an employer, today’s findings make for uncomfortable reading. We…

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Women in Leadership – too nice? Too bossy?

women_calculator_desk_1600_wht_7996Leaving aside the whole issue of women on FTSE100 boards and the Norwegian Golden Skirts have women finally cracked the glass ceiling?

Well according to Herminia Ibarra and her colleagues, writing in the September 2013 HBR, persistent gender bias disrupts the learning process of becoming a leader.

They are talking about what they call “second generation gender bias”. Not direct discrimination but things like the paucity of role models for women, career paths and jobs that have become entrenched with a gender bias, and women’s lack of access to sponsors and networks.

They also talk about the double binds facing women. In most cultures leadership is associated with masculinity. The ideal leader, like the ideal man, is decisive, assertive, and independent.

Women, on the other hand, are expected to be nice, caretaking, and unselfish.  Research shows that female leaders who excel in traditional male domains are viewed as competent but less likeable than their male counterparts.

Yet research shows that female CEOs are trusted more than male ones and can add real value to teams.

Behaviours that suggest self-confidence or assertiveness in men often appear arrogant or abrasive in women. Female leaders who adopt a feminine approach to their work may be liked but not respected.

They are seen as too emotional to make tough decisions and too soft to be strong leaders.

Yet research carried out by Zenger and Folkman in 2011 on over 7,000 executives using 360 degree feedback, showed that women were rated higher than men at every managerial level.

However the higher in the hierarchy you went the more men there were. So were companies promoting the right people?

They used 16 competencies in their research, which they had identified as being the most important in terms of overall leadership effectiveness.

These were:

  • Takes initiative
  • Practices self-development
  • Drives for results
  • Develops others
  • Inspires and motivates others
  • Builds relationships
  • Collaboration and teamwork
  • Establishes stretch goals
  • Champions change
  • Solves problems and analyses issues
  • Communicates powerfully and prolifically
  • Connects the group to the outside world
  • Innovates
  • Technical or professional expertise
  • Develops strategic perspective

Comparing mean scores for men and women the women scored significantly (statistically) higher than the men on 12 of the 16 traits – and not just the ones that women are known to be better at.

They scored the same as men on connecting to the outside world. innovating, and technical or professional expertise. The only trait where men scored higher was on developing a strategic perspective.

So what’s to be done? Ibarra and her colleagues don’t suggest anything dramatically new or innovative.

Progressing to leadership positions means leaving behind your old professional identity and learning new skills (have a look at Charan’s pipeline model).

women_puzzle_pieces_1600_wht_7872That can be scary so having supportive mechanisms in place such as providing leadership programmes, mentoring and coaching (and I find in my coaching that women are less defensive and often respond better than men), and providing a support group or a safe space – perhaps an action learning group – can make a real difference.

Golden Skirts don’t necessarily add Midas touch

David Cameron has been taking advice about Norway’s 40% quota of women on boards.There is a campaign to get the UK up to 25% by 2015.

Someone has even started a 30% club to improve on that figure.

So the general impression is that this is a good thing. Cameron says there is overwhelming evidence that having women on boards is good for business.

The government has also said that if companies won’t do it voluntarily the government might have to impose a quota.

That’s what happened in Norway after the 2003 legislation failed to achieve its target – moving from 9% to 40% – by 2005. So on January 1st 2006 publicly listed companies were given two years to comply or be dissolved.

So is there “overwhelming evidence” that it’s a good thing? Unfortunately researchers at the Ross School at the University of Michigan found that having the 40% quota negatively affected companies. They also believe the same thing would happen in the USA and the UK as they have similar systems of governance. Amy Dittmar, associate professor of finance, says “boards are chosen in order to increase shareholder wealth. Placing restrictions on the composition of boards will reduce value”.

First the stock price dropped by almost 3% following the introduction of the new law and 5% for those companies with no women on the board at the time. A measure of the firm’s corporate governance used to determine a company’s value, Tobin’s Q ratio, dropped 18% where companies had to increase the number of women by 10% or more.

One of the researchers, assistant professor of finance Kenneth Ahern, said that their findings support the view that board structure affects value. “Firms that were required to make the most drastic changes to their boards also suffered the largest negative returns. …constraining the selection of board members has a large negative impact on value”

Ahern and colleague Amy Dittmar point out that this is not because of the gender of the new board members but because of their lack of experience and young age. The constraint imposed by the 40% quota led firms to recruit women board members that were younger and with different career experiences. Dittmar says “when firms were free to choose directors before the rule they tended to choose women who were similar to men directors”. Recent research suggests women perform less well than men in competitive situations so could that have a bearing on it as well?

With a large demand and a small supply firms were forced to select directors they wouldn’t otherwise have chosen. And one newspaper report said that one women had ended up on 14 different boards.

Perhaps this research should give everyone a pause for thought. What’s good for diversity is not necessarily good for the company’s performance.  I’m sure women want to be in top jobs on merit and with more women than men graduating you might think it’s only a matter of time before we see more of them up there and the number of women on boards has increased lately in the UK.

However the number of women in senior management positions seems to have dropped – to around 20% globally, according to the Grant Thornton International Business Report. And in privately held businesses the number with no women at all in senior management has increased to 38%. Recent UK research shows that women managers are more critical of  organisations so does that influence women in deciding whether or not to go for promotion?

Whatever the reason with fewer women in senior management how will they provide succession at board level?

And should we really be worrying about gender imbalance. Don’t shareholders want the best person for the job irrespective of gender?

FYI the country with the most women in senior management positions is Thailand (which also has most female CEOs with 30%), followed by Georgia, Russia, Hong Kong and the Philippines. Not what you might have expected? But probably no surprise to find India, Japan and the UAE have less than 10% of women in senior management.

Update March 2013

In contrast to the US research a study of the French blue-chip CAC Index found that companies with at least a third of females in management positions had a 30% higher return than others over the last 6 years.

Professor of the management of human resources at Geneva University, Michel Ferrary, found that the CAC 40 had lost 35% of its value between since 2007 but the 10 companies which employed at least 35% of women managers (dubbed the Femina Index)  lost only 5% of their value.

The 10 companies in the Femina Index included Axa, Accor, Danone, and L’Oreal. Ferrary said that these companies were; “less discriminatory, drew their employees from a wider pool, and were more in tune with consumers.”  More diversity seemed to improve decision-making (see also:  Teams & Diversity).

The French government requires companies to have 40% women directors by 2017 but not one of the CAC 40 companies has a female CEO.

 

 

Women now getting on board

FTSE companies have apparently recruited more women onto their boards than ever before since the publication of Lord Davies’s report. 23 this year so far compared with 18 in the whole of 2010.

He wanted companies to double their female contingent within 4 years and they have made a good start with 30% of all appointments being women.

Also the number of blue chip companies without a female board member has dropped from 21 in December to 14. Percentage wise however this is not a big change – from 12.5% in December to 13.9% of all FTSE 100 seats and still only about 9% of FTSE 250 seats.

The UK government is unlikely to impose mandatory quotas unlike Norway which has required companies to have a 40% quota. (See “Getting Women on Board“)

According to a report in The Guardian (02/07/11) this has been a mixed blessing for Norway’s so-called “golden skirts”. It has increased the number of non-executive directors (NEDs) but not the number of female managers. And the situation there seems similar to UK where a handful of women have a handful of NED roles.

And now Helen Morrissey, 45 year-old mother of nine with a house husband, has founded the 30% club aimed at ensuring that all boards have at least 1/3 female members by 2015.

She reportedly manages £50 billion of investments and said; ” The idea that women can have a family and friends and hold down a difficult, high-octane job when both partners work full-time ….. is not impossible but it’s a bit unrealistic”.

Updated 5 September 2011: The government’s deadline for voluntary compliance with a 25% target for female board membership has passed uneventfully. Only 8 companies in the FTSE100 have announced their plans to meet this target over the next few years. These are HSBC, Anglo-American, Centrica,GSK, National Grid, Vodaphone, M&S, and Land Securities, according to research by Pinsent Masons reported in The Times. This figure is disputed by Cranfield School of Management researchers who say there are actually 15 companies which have signed up.

There are 12 companies which already have 25% female board directors – so that makes possibly 27. The number of women on boards has increased to 14% since Lord Davies’s report with 23% of new appointments since then being women. There are still 14 companies with no women at all on their boards.

Women in senior management in big companies according to Deloitte:

  • Norway = 35.6&
  • USA = 15.7%
  • Canada = 12.9%
  • France = 12.7%
  • Australia = 11.2%
  • Spain = 9.2%
  • Netherlands = 9.2%
  • Hong Kong = 8.6%
  • Germany = 8.2%
  • China = 8.1%
  • Belgium = 7.7%
  • Czech Republic = 7.6%
  • Singapore = 6.4%
  • Italy = 6.2%