Gender diversity is a complex, multifaceted, problem that is highly resistant to simple solutions.
Gender diversity is a complex, multifaceted, problem that is highly resistant to simple solutions.

Women and Leadership

Companies with the highest representation of women on their top management teams have better financial performance than companies with the lowest representation.

Stephanie Strickland

Stephanie Strickland

Stephanie Strickland is R&D Manager for the Association of Business Schools and associate adviser for the Foundation’s diversity activity Women in Leasing. Stephanie holds an MSc in Gender and International Development from the London School of Economics and Political Science. She is one of the editors of LSE’s Engenderings, which brings together social and political science, media studies, philosophy, environmental studies and technology to explore gender in culture, politics, business and society.
Stephanie Strickland

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Introduction from Executive Producer JO DAVIS
Although women’s educational attainment and their presence in the workforce have increased, their advancement – and specifically into senior management positions – has stalled. This piece from Stephanie Strickland, Associate Diversity Adviser for the Leasing Foundation, and Professor Peter Thomas, Foundation COO, looks at some of the key issues revealed by research into gender diversity about the barriers to women's progress.

Who should be interested in this?
Diversity professionals, human resources specialists and leaders of organisations committed to action on diversity.


Women and Leadership

A recent Cranfield School of Management study found that, in the first half of the 2012FY, 44% of board appointments at FTSE100 firms went to women, with a figure of 36% for FTSE250 companies. But in the second half of the year progress slowed, to 26% and 29% respectively.

In Europe, 85% of non-executive board members and 91.1% of executive board members are men. The average increase of the number of women on boards  is only 0.6 percentage points per year since 2003. At this rate of progress it would take around 40 years to even get close to gender balance in boardrooms.

In 2001, women held 14.7% of US Fortune 500 company board seats. A decade later in 2011, this figure had increased only to 16.1%. In 2002 women held 15.7% of Fortune 500 corporate officer positions, the same as 2008. 10% of Fortune 500 companies had no women on their boards in 2011[1]. Only 10% of the senior employees in private equity in the US are women.[2]

Globally, the proportion of women in the workforce has grown from just over a third of all workers in 1970 to almost half of the total workforce in 2012. Women are obtaining higher educational degrees, and they now represent 60% of all US bachelor degrees conferred annually, an increase of 20% since 1970.[3] A larger share of women now work in management, professional, and related occupations worldwide.

In terms of pay, women working full-time earned about 77% of their male colleagues, and the pay gap holds across all educational levels[4]. The gap is largest for professional women. Women who raise families also experience a 2.5% earnings penalty for each child, compared to fathers who receive a 2.1% earnings boost for each child.

Yet the business case for women in leadership positions is unarguable.

The inclusion of women in the top ranks of company leadership has a direct and positive impact on financial performance. Companies with the highest representation of women on their top management teams have better financial performance than companies with the lowest representation of women.

Those whose boards included a strong representation of women outperform their sector in terms of return on equity, operating results, and stock price growth.[5] IPOs for companies with women in their top management teams performed better in both the short and long run than those with few or no women[6].

In financial services, emerging fund managers (often women- and minority-owned firms that manage less than US$3 billion in assets) comprise more than 40% of the top quartile of top performing firms in the US, but currently handle just 1% of pension assets.[7] Female financiers also have particular advantages over their male counterparts, including being more risk-averse and better able to avoid volatility. [8]

What are some of the barriers to women’s progress?

Ever since the US Glass Ceiling Commission Report[12] almost 20 years ago, a stream of research has identified barriers to women’s advancement. Based on this body of work the key barriers are, broadly:

  • Recruitment. Businesses that are not actively recruiting women have a smaller pool from which to draw for promotion.
  • Culture. Women are often alienated by elements of corporate culture such as gender communication styles, accepted behaviors, and ways of socializing that favour men.
  • Support. Women, especially those returning from period of maternal leave, may be placed in ‘dead-end’ jobs from which it is hard to progres.  There may be different standards for performance evaluation for women and men, but little or no access to informal networks of communication, including mentoring, that key women into the organisation. All of this means that women stall in the talent pipeline.
  • Flexibility. Women usually assume the role of principal family caregiver and this damages their career advancement prospects in corporate cultures that do not provide support and flexibility before during and after the birth of their children.
  • Aspirations. Research has identified that women and men have different levels of confidence about, and attitudes towards, their careers. Compared to men, women often lack self-confidence and self-belief and this leads to cautious career choices and aspirational horizons that disadvantage them when seeking advancement.
  • Perception. Women are often penalized for displaying too little or too much assertiveness. Womens’ communication style – often inclusive and empathetic compared to men – may create a perception of a lack of ambition; conversely, a woman who is ‘too assertive’ may be seen as lacking in empathy and so failing to confirm to accepted female norms.
  • Monitoring. Despite many and varied diversity initiatives, when there is a lack of vigorous and consistent monitoring of those initiatives it means they become ineffective.

How can we respond?

One response is the 2003 Norwegian government’s mandate that 40% of the boards of all publicly listed company should be women. The EU now has a target of 40% of women non-executive board members for publicly-listed companies by 2020. The UK government has also issued a warning of tougher action – including legislation – if change in the gender diversity of boards is not forthcoming[9].

It might be argued that imposing quotas will not work, but the Norwegian mandate has spawned Female Future, a programme of intensive development, part-funded by the Confederation of Norwegian Enterprise (NHO), that has resulted in 62% of women participants being promoted to board level.[10]

Gender diversity is a complex, multifaceted, problem that is highly resistant to simple solutions. It is rooted in organisational culture and practice, societal perceptions, structural and economic factors and individual beliefs – often amongst women themselves. As the EU notes in its materials on the legislation, “tangible progress is the exception and not the rule.”[11]




[3] US Department of Commerce, Economic and Statistics Administration, and Executive Office of the President, Office of Management and Budget, for the White House Council on Women and Girls. Women in America: Indicators of Social and Economic Well-Being. March 2001. 


[5] The Bottom Line: Connecting Corporate Performance and Gender Diversity. 2004. Available at

[6] Welbourne, Theresa M. “Wall Street Likes Its Women: An Examination of Women in the Top Management Teams of Initial Public Offerings.” Cornell University Center for Advanced Human Resource Studies Working Paper 99-07.

[7] Recent research shows that women are increasingly learning to prefer the opportunities that global companies offer them with the result is that multinational companies end up with better gender balance in new markets such as China. See Winning the War for Talent in Emerging Markets: Why Women Are the Solution (2011) Sylvia Ann Hewlett and Ripa Rashid.






CC BY 4.0 Women and Leadership by Stephanie Strickland is licensed under a Creative Commons Attribution 4.0 International License.