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Yes, Global 500 Women CEO Numbers Are Lackluster—But Other Hopeful Signs Point to a Brighter Future
Part One of a Six-Part Series
We know companies thrive under women leaders. Research shows organizations with women represented at the top are 50 percent more likely to outperform their peers, and gender-balanced teams create better client retention, growth and profit. So why is it taking so long for the world to take action?
Fortune recently released its Global 500 list, which ranks the largest companies by revenue worldwide. It turns out that of the 500 companies on the list, women CEOs lead only 24 of them. That’s up from last year’s grand total of 23, and up from 17 in 2015 when Fortune began tracking these metrics.
Things look a little better in the US version of this roundup, but don’t get too excited: Here, women lead 44 companies on the Fortune 500 list, up from 41 last year.
There’s no denying these are disappointing numbers. The painfully slow progress reminds me of the World Economic Forum’s prediction that at the current pace, it will take 132 years to reach full gender parity, up from 100 years estimated before the global COVID-19 pandemic.
Despite the bleak reality, I do believe we’re on the cusp of a dramatic acceleration in these numbers—not just in CEO roles but at all levels of leadership.
What I’m seeing has inspired me to do a blog series on some new trends that will give women a much-needed burst of momentum toward achieving gender equity in leadership. In this six-part series, I’ll detail these trends and give some practical insights on what organizations and individuals can do to expedite the real progress taking place right now. And, at the Women in Leadership Institute™ this fall, I will take to the mainstage to bring these insights to life for the thousands of women leaders in attendance.
The first trend is the rapid rise of women in the boardroom, which is great news, as needed change is usually driven by what is modeled at the top.
According to Women Business Collaborative’s (WBC) April 2022 Special Report, “Women held 27 percent of all board seats in 2021, up from 24 percent in 2020—the largest year-over-year increase among the Russell 3000 and far above the Russell 3000’s average annual increase of 2.14 percent for women on boards.” While the numbers have regressed a bit in recent months, they came roaring back in July: WBC reports that women comprised 40.4 percent of new appointments to public boards, an 8 percent jump since June.
It’s tough to argue with the benefits of bringing more women into the boardroom. Research shows that companies that do so enjoy better year-over-year revenue than those whose boards are less gender diverse. There are likely several reasons why. Women understand what drives customers, since they make most purchasing decisions. Women tend to have natural strength in qualities like empathy, authenticity and inclusiveness, much needed in an age where leaders are expected to inspire, engage and transform rather than rule by authority. And women’s reasoning methods lead to fair decisions when competing interests are at stake.
Best Buy exemplifies what can happen when you have strong leadership at the top, from the boardroom to the CEO and executive suite. It has an incredibly diverse board, balanced across gender and race, and is run by a female CEO. It has been a wild turnaround success story since Hubert Joly took the helm as CEO (2012–2019) and then developed and supported successor Corie Barry, who is focused first on employee and customer relationships. As the company website puts it: “Under Corie’s leadership, Best Buy is driving toward being one of the best places to work in America, doubling our significant customer relationship events to 50 million and growing annual revenue to $50 billion by fiscal 2025.”
While decisionmakers obviously like the financial piece, the truth is that board actions and attitudes set the tone for the rest of the company. Once it’s the norm to have women well represented at the board level, I am optimistic that other areas, like the CEO and executive team, will soon follow. From there, as a new paper by Ana Catalano Weeks of the University of Bath and Audrey Latura of Harvard University suggests, we might expect to see other “downstream effects” that benefit women at all levels of the organization.
Admittedly, the paper I just mentioned hinges on mandated quotas, which exist in Europe but have not been widely embraced in the US, where a “carrot” versus a “stick” approach is more palatable. For example, Goldman Sachs proclaimed a few years ago they would take companies public only if they had gender and racial diversity at the board level. Regardless of the approach, I believe we can seize the momentum generated from the steady increase in women board members and leverage it to bring similar results to all levels of our organizations.
I’d like to close with a challenge: Don’t let the progress stall. If you are on a board that is not gender diverse, expand the circle or ensure a woman gets the next available seat. If you are on a gender-diverse board, prioritize your efforts to make executive teams, leadership teams and talent pipelines equally diverse. In partnership with the CEO, wield your influence toward advancing the cause of women leaders at all echelons of business.
The World Economic Forum’s projections don’t have to become reality. When we all work together, we can close the gender equity gap not in centuries, but in decades—or sooner.
Jennifer McCollum will host Linkage’s Women in Leadership Institute this November 1–4 in Orlando, Florida, and virtually. Join thousands of women leaders for four days of transformational development and supercharge your leadership journey.
Women in Leadership Institute™
NOV. 13–16, 2023 | Orlando, Florida, or Virtual
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