The Decline of Women in CEO Positions Within Fortune 500 Companies

The introduction

It was in May 2018 that many mainstream journals began to point light on the topic of the decrease in the number of women in Chief Executive positions within fortune 500 companies. The number of women within CEO positions has been slowly increasing in the years prior. While equal rights and pay gap have been a major issue in which women have been fighting for some time now. The decline of women in C-suite positions in Fortune 500 Companies has been developed and researched to analyze the overall causes leading women to resign so suddenly.

When given the task to begin researching topics or questions within my field, I first began with the relation of women’s cultural backgrounds effect on management. While conducting research relative to my question, I then had to ask myself the derivative of my question in which I was initially curious about the women in higher level positions downfall. Furthermore, I wanted to understand what factors were playing into the downfall of women in top management positions. Therefore, this led me to my final question in which I will be reporting the decrease of women in chief executive positions within Fortune 500 companies.

The History of Women in CEO roles

In the year of 1972, Katherine Graham was the first woman in America to become a CEO at the Washington post company. Shortly following Graham’s major stepping stone for women, Maron D. Sandler became CEO at the Golden West Financial. These two bright women created an opportunity in which no woman thought of accomplishing based on gender. To this day there has been only 60 women to hold CEO positions with Fortune 500 Companies. It was never the issue of intelligence but rather the opportunity had never presented been presented to women. Thus fort, women like Sandler and Graham have become major pioneers within the management industry.

The Factors

There are many factors in which can lead to women to gaining CEO positions but, do these factors also relate to their downfall as well? Typically, companies will look towards education levels, age, race, social class and martial/ parental status before hiring. In a study titled “the presence of women in Top executive Positions in Non-Profit and 500 companies”, the author states “…age, gender, and ethnicity are the most salient, visible and impermeable demographics that impact categorization and social identity” (Chou 2011 et al. 16)

According to a study conducted in 2014 titled, the top four percent: an exploratory study of women leading fortune 1000 firms, the authors analyze the concept in which women have more education that men within the same positions and yet are still less likely to become a CEO. According to the data collected, at least 97.5% of women in fortune 1000 companies have earned their Undergraduate and 51% has earned their graduate degree. This information is compared to all CEO’s within fortune 500 companies in which 96% has received their Undergraduate degree and 60% has completed their graduate. There also is the aspect in which the racial composition of Fortune 500 companies is Caucasian/White. There are about five women in which make up the diversity in which includes Asian, Latina and African American. (Karsten. Brooke. Marr., 59) Furthermore, according to a yearly study conducted by Mckinsley & Company about women in the workplace, only about 1 in 5 C-suite leaders is a woman, and only 1 in 25 is a woman of color. (6)

The socioeconomic class of family of origin begins with “….70% of white executive women came from upper middle- or upper-class families (the top 15% of the class Structure). (Karsten Brooke. Marr., 61) For the other 30%, which makes up women such as Ursula Burns CEO and Chairman of Xerox was raised within a single parent home. Furthermore, there is Virginia Rometry whom was raised by a single mother outside of Chicago. Then there are the first-generation college students in such Debra Cafaro, Patricia Kampling, and Constance Lau.

When it comes to measuring one’s potential, companies have always used these stereotypes to not only hold women back but men as well. However, when discussing the advancement of women to CEO positions in charge of Fortune 500 companies many times women younger than 40 do not receive the position. To avoid sounding like a discrimination case rather than an analysis, the average age for women within CEO positions is 54.5 while the average for men was 54. Moreover, recently there has been a few younger top executives such as Marissa Mayer of Yahoo! at age 37 in which she along with Laura Alber and Heather Bresch are the youngest women to become CEOs under the age of 45.

Moving along to the Marital and parental status in which 90% of women within CEO positions have shared their marital status while it’s been quite a task to find the exact percentage among men. Martial status would be considered a factor due to the stereotype in which when women began to form families they are unable to complete task as a CEO. Angela Brady, a former CEO for Well Point Inc. stated that it’s the biggest myth is that there must be a tradeoff when women are in c-suite positions and have families. Brady goes on to state that there is a sacrifice and major decisions must be made however, once a woman has chosen family or job she must stick to her decision and never second guess themselves. (Karsten et al.2014)

What is causing the decline?

When trying to work towards a position within the top management there is this invisible ceiling in which holds only women back from gaining such opportunities. This concept is considered the glass ceiling and according to Judith Oakley’s Gender Based Barrier to Senior Management Positions… “…the glass ceiling is not the one ceiling or in one sport but rather many varied and pervasive forms of gender bias that occur frequently in both overt and covert ways”.(Oakley, 321) The term is used to discuss gender bias in which prevents women from reaching their maximum potential with companies.

The purpose of mentioning the several factors and demographics above was to have a basis in which many corporations use to determine whether a woman is qualified for the C-suite position. Although women have made their way up the ladder to top management, I cannot help but believe based on research that women are put into glass cliff positions in which they are hired or promoted on the basis to recover a failing company. Research in 2013, conducted By Sabharwal, found that senior executive women in distributive and constituent policy agencies are more likely to face glass cliff. Furthermore, a study conducted on law students, found that women are more likely to be appointed higher risk cases while men receive lower risk. (Ellsaid & Ursel. 158)

When discussing exactly what causes women to resign from CEO positions there is no direct answer that pops up on google. Instead many results began with stereotypes and never discuss what exactly is leading to the downfall. To gain a better understanding, we will now analyze two articles written in 2000 and 2018 about the scarcity of women within CEO positions and compare the results from each study. From these studies, we will be able to comprehend the exact area in which both studies overlap and determine in the 18-year gap whether this is the issue causing the matter.

In 2000, Judith Oakley conducted a study titled Gender-based Barriers to Senior Management Positions: Understanding the Scarcity of Female CEOs. Oakley uses this source to analyze demographics, linguistic socialization etc. She focuses within the glass ceiling concept in which she can use to come to multiple conclusions. Oakley states that many of the issues in which thrive with women not being able to reach the top have dwelled on the whole process of selection, recruitment and promotion in large corporations in which need major reconstruction. Furthermore, Oakley dwells within socialization in which she challenges companies’ dynamics and uses a feministic approach to break down the exact reasoning causing men to have higher consideration for CEO positions. When conducting a study Oakley asked women what the barriers to women’s further advancement were between 49 and 52 percent of women cast blame towards male stereotyping and exclusion from informal communication networks. (332)

In 2018, two authors wrote an article titled Re-examining the Glass Cliff Hypothesis using Survival Analysis: The Case of Female CEO Tenure. Within this article, Elsaid and Ursel analyze the the evidence on which women CEOs receive lower turnover due to a company not wanting negative publicity and the greater the education the more job security a CEO will have. The study focuses on discussing the analysis on the glass cliff approach, determining if the concept is present in the corporate world and analyzing why women are involved within the glass cliff approach. In the conclusion of this analysis, in which the authors discuss their hypothesis in which was the downfall of women is due their tenure. However, according to the authors’ results women have greater tenure then men in which leads companies to want to avoid laying women CEOs off to avoid negative publicity. From this analysis, they determine that there must be an internal issue in which is causing the decline.

Conclusion

While comparing the two articles in which both conducted hard studies into the topic, I still believed this issue went further than the decision-making process of what is good for the business. Instead, from the research and vast amount of information received there was been a common concept in which author have discussed. Fortune 500 Companies are simply just not understanding what women within c-suite positions means to the company internally and externally. Each study above dwells within the overall corporation having to realize that stereotypes are hindering the overall development of management and employment productivity mentally rather physically. It was within one of the earlier documents before coming to question of why women CEO was declining that I learned due there not being anyone before to teach women how to socially be respected within the organization that leads pressures in which go unseen by the public. Instead the public eye only knows that corporate women leaders are resigning left and right on the basis in which they are being pushed. The social and physiological dynamic in which goes into understanding women’s struggle within CEO positions has yet to laid out in a flat-out article but rather picked apart aspect by aspect and dissected by business professionals and media outlets. It then leads to the conclusion whether women are truly believing the stereotypes about women’s leadership skills and giving up or choosing a better fight.

References

1. https://kdmengineering.com/female-ceos-fortune-500-companies/

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