by André Schnabl
November 17, 2011
This evening I would like to revisit the theme I laid out last year. We should celebrate our many successes in moving more women into leadership roles. We need to also recognize that there is still work to be done. Finally, I would like to suggest a call to action.
I have said from the beginning of this annual award, 12 years ago, that the vitality, of WIT is an inspiration to anyone that understands that the advancement of women into leadership positions is important to our businesses and our communities. It is not only the right thing to do, but it is a business imperative. As a nation we will be at a competitive disadvantage, if we do not have more women and diversity “leading.”
Tonight is recognition of the continued progress that our community is making in what has become a business priority. We need more women in our boardrooms and in the “C” Suite. We no longer have to convince anyone that gender diversity in senior management and the boardroom produces superior financial performance. The research is not being disputed.
Put another way, gender diverse teams simply outperform their homogeneous counterparts. So this is clearly not a women’s issue, this is a business issue. Addressing this problem should be important to both genders. Although women have made impressive gains at the entry level and middle management, we have not made the same progress at the highest executive level.
Notwithstanding the recent promotion of Virginia Rometty, to the CEO position at IBM, two weeks ago, only 18 CEO’s of the Fortune 500 are women. That means that 3.5% of our largest US companies are led by women. I recognize that we are not all part of the Fortune 500 but the trends are very similar within smaller companies.
As McKinsey research suggests, we have a “leaky” talent pipeline. At each transition up the management ranks, more women are left behind. Women represent more than 50% of entry level hires, but that percentage diminishes to less than 40% of middle management positions, less than 30% of senior-management, and the number continues to diminish as women enter the C-suite and boardroom. The point here is that, gender parity in education and entry level hiring does NOT produce women leaders, and it does NOT produce women CEOs in adequate numbers. If we can raise the number of middle management women who make it to the next level, the shape of the talent pipeline would change and more women who make it to senior management would share an inspiration to lead.
This evening, we are celebrating 30 nominees and finalists who have demonstrated a passion to succeed against some of the odds we have talked about. I see these achievements everyday including at my own firm, through our initiative known as Women at Grant Thornton. We have made much of our progress to date through creative programs that many of your businesses also offer: flexible work arrangements, mentoring programs, off-ramping and on-ramping, and ways that allow family and career to co-exist.
The programs that have led to the great successes within middle management to this point will not change the status quo at the executive level. If we want to have significantly more women at the executive level and in the boardroom, there will be the need for cultural transformation. A part of the cultural problem [according to McKinsey] is that “too many women are evaluated for promotions primarily on demonstrated performance while men are evaluated on potential… an implicit corporate mindset barrier to advancing women.”
Cultural transformation comes from the top of an organization, and will not occur unless it becomes a strategic priority. Our CEOs need help and support from you, the advocates of women in leadership positions in affecting cultural change. A part of the honor of being a nominee this evening is that you have already won respect within the companies you represent. You have the right to engage with your CEO on these issues. I also know that your friends at WIT would love to help you in that discourse.
So here is my challenge to you:
On Monday, visit the WIT website and pull down these remarks together with some of the research produced by Catalyst and others and have a conversation with your CEO about these issues and how they should impact your company’s strategy.
Who knows, if enough of you get an engaged response, perhaps WIT would be prepared to facilitate a CEO round table focused on “Women in the C-suite and boardroom.” Such a discussion would have a real impact.
Thank you for supporting this challenge and to all of you nominees, we celebrate your success – congratulations! And to all the finalists, good luck this evening!
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Barsh, Joanna. Yee, Lareina. “Changing companies’ minds about women.” McKinsey Quarterly. September 2011. Web 11/1/2011.
Carter, Nancy M. Silva, Christine. “Women in management: delusions of Progress” Harvard Business Review. March 2010. Web 11/1/2011.
Foust-Cummings. Heather. Dinolfo, Sarah. Kohler, Jennifer. “Sponsoring women to success.”Catalyst.August 2011. Web 11/1/2011.
Kohler, Jennifer. Dinolfo, Sarah. Foust-Cummings, Heather. “Fostering sponsorship success among high performers and leaders.” Catalyst. August 2011. Web 11/1/2011.
Woolley, Anita. Malone, Thomas. “What makes a team smarter? More women.” Harvard Business Review. June 2011. Web 11/1/2011.
Wolfe, Lahle. “A Decade of Women CEOs at FORTUNE 500 Companies.” About.com Guide. Sourced November 7, 2011. Web 11/1/2011.