A Personal Letter from Molly D. Shepard

I recently had the opportunity to read an article in the May 26th issue of Barron’s entitled, “Breaking the Glass” and another article in June’s Harvard Business Review summarizing a research study undertaken by Catalyst. I found both pieces, each from a different – and contradictory -- perspective, quite interesting.
The premise of the Barron’s article is that women have indeed made progress in setting the pace as governors, senators, university presidents and corporate executives. Barron’s reports that there are six female governors out of 50, six female presidents at the 40 colleges and universities with the highest endowments in the country, and seven female CEOs at the top 500 revenue-earning companies. The article states that last year women accounted for one out of 13 “clout” positions—executive vice president or higher—in the 500 largest U.S. companies, up from one in 40 in 1995. Unfortunately, as the Catalyst study points out, these positions were actually clustered around the lower end closer to the executive vice president level than CEO.

The Catalyst study “What’s Holding Women Back” clearly takes a more pessimistic view of women’s progress than does Barron’s. Their study attempted to determine the barriers to advancement by asking both senior level women and CEOs what they believed were the relevant factors that held women back. Seventy nine percent of women and 90% of CEOs agree that lack of general management or line experience is a primary obstacle. The research shows that in 2002, only 9.9% of corporate officer line positions in Fortune 500 companies were held by women.

While both the women and the CEOs agreed on the importance of line experience, a majority of the female executives cite other factors as relevant barriers. These factors mirror the results found in a recent Leader’s Edge Research study. They include exclusion from informal networks, stereotyping, lack of mentoring, shortage of role models, commitment to personal or family responsibilities, lack of accountability on the part of senior leadership and limited opportunities for visibility.
The CEOs also acknowledged these as obstacles, but were less convinced of their significance. CEOs put more weight on women’s “ineffective leadership styles and lack of skills”. This perception gap is all the more relevant because, according to Catalyst, three quarters of the women surveyed were within two reporting levels of the CEO, and yet their “bosses” were seeing stereotypical “skills” problems instead of the gender-related factors the women saw as important.

This difference in perception is also crucial because, as a general rule, companies that stand out in their commitment to developing female business leaders all share at least one thing in common: a commitment from the very top. If the key to women’s advancement rests with the CEO -- and yet many CEOs don’t see the issues that women executives do -- how can these companies effectively further the progress of women?

The CEO must have a strategic vision and build a business case for gender diversity in order for women to move ahead and succeed. As Professor Belle Rose Ragins, University of Wisconsin, School of Business Administration states, “As Corporate America rises to this challenge and welcomes still more women into the upper reaches of management, the payoffs for business could be considerable. Companies will start running on two cylinders instead of one.”

The Leader’s Edge™ continues to be fascinated with the statistics and perspectives on women’s progress in the workforce. Indeed, there is certainly an “interpretation factor” depending on the individual’s viewpoint. If, as the Catalyst study reports, CEOs are viewing women as lacking in specific business skills required to advance, women will have to do even more to make their skills and experience known. This is one of the areas we work on in our Leader’s Edge programs.
As always, I welcome your thoughts!

Molly D. Shepard
Founder and CEO
The Leader's Edge™

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