The Leadership Gap: Why More Women Are Not CEOs

Despite remarkable progress over the last two decades, women face significant obstacles in advancing and remaining in executive positions in Corporate America. Women can now dream of a life beyond housekeeping and child-rearing, besides working their way to the top of career success. But a significant factor hindering their path is not being taken seriously. Equal representation or equal treatment still seems to be a far cry for women.  

Women comprise about 47% of the US workforce, yet they make up barely a quarter of all senior executives at large public companies. Despite the pandemic, 2022 is seeing a new record of female CEOs at Fortune 500 companies. In 2020, the year COVID-19 hit, there were 37 female Fortune chiefs, around 7.4%. In the following year, this number rose to 41 and stood at 8.1%. As of March 2022, there were 74 female CEOs employed at America's 500 highest-grossing companies, up from 41 in June of 2021. Yet, the new high still only translates to around 15 percent female representation at the top of the country's biggest corporates.   

Karen Lynch taking over the lead at CVS Health in February of 2021 made the company the biggest in Fortune 500 history to ever be led by a woman. The company's 2021 revenues rank the pharmacy and healthcare chain as the fourth biggest public business in the US, bringing in $268.7 billion. In 2019, the highest-grossing company with a female CEO was General Motors, then in rank 13. The carmaker, with CEO Mary Barra at the helm, is now the third-biggest Fortune 500 company led by a woman and the 22nd biggest overall. Jane Fraser, who took over at Citi in March of 2021, was the first female CEO of a major US bank. Other notable Fortune 500 companies that were female-led in early 2022 are UPS, Best Buy, Progressive, Oracle, and Northrop Grumman.  

Unfortunately, many discriminatory factors come into play when hiring women at the top echelons of any organization. To start with, women are subject to gender stereotypes. Qualities such as aggression, ambition, and dominance tend to overlap with the stereotypical qualities of men more than women. Hence, men are considered natural leaders. Secondly, women are major victims of in-group favoritism. Nearly 80% of board members in large US public companies are men. They are ultimately the ones who take calls with regard to hiring and paying CEOs, so this becomes a deterrent for women. Another sad reality is women who become CEOs are often appointed to companies that are in crisis or are performing poorly. Although female CEOs attended more elite schools than their male counterparts, they were less likely to head their companies' boards, had shorter tenures as CEOs, and were paid less than their male counterparts. The companies they led were also relatively new, smaller, and less prestigious. Another problem is that men occupy most boardrooms and leadership positions, making women less likely to have strong professional and mentorship networks, social ties, or insider information.   

Few remedial measures could be adopted to counter the situation. One such option is giving women the same opportunities and facilities to develop as men. Workplaces that invest in mentoring female leaders and provide a better work-life balance, like paid family leave, are more likely to attract and retain women in managerial roles. Companies could also focus more on preventing biases, such as stereotypes and favoritism, from discouraging the selection and retention of women in higher positions. Precisely put, society needs to ensure women are given more opportunities to develop leadership skills.