JUNE 30, 2017, No. CCXLXIV
THIS ISSUE’S HIGHLIGHTS:
I. WOMEN CEOs IN U.S. AT ALL-TIME HIGH
II. WHY MORE WOMEN DON’T START BUSINESSES
III. AUSTRALIA’S WORKPLACE GENDER QUOTAS
IV. RECORD NUMBER OF WOMEN ELECTED IN UK, FRANCE
I. WOMEN CEOs IN U.S. AT ALL-TIME HIGH
Fortune Magazine released its 2017 Fortune 500 list, which ranks major U.S. companies by revenue, and 32 of the companies, or 6.4%, are run by a woman CEO. While far from impressive, this is the highest number of women CEOs ever in the listing. Last year, only 21 women CEOs made the list, so clearly, women are moving up the ranks of corporate leadership.
Mary Barra of General Motors, Ginny Rometty of IBM, and Indra Nooyi of PepsiCo are just 3 of the 32 women running U.S. Fortune 500 companies
In addition to well-known women CEOs such as Mary Barra of General Motors, Ginny Rometty of IBM, and Indra Nooyi of PepsiCo, some of the companies which now have women in charge within the past year include Occidental Petroleum, toy maker Mattel, candy manufacturer Hershey, and office supply company Staples. (“The Number of Women CEOs in the Fortune 500 is at an All-time High,” Washington Post, June 7, 2017).
Compared to peer companies in Western European countries, the U.S. fares well in having more women at the helm of major corporations. In Western Europe’s largest companies, only three women are CEOs of companies in blue-chip indices. The three are Ana Botin of Banco Santander in Spain, Isabelle Kocher of Engie in France, and Nancy McKinstry of Wolters Kluwer in the Netherlands. To see all of the women running U.S. Fortune 500 companies, click here.
What difference does it make then to have more women leading companies? A 2011 Corporate Women Directors International Report (CWDI) found that women CEOs were more likely to have a higher number of women directors and senior executives than in peer companies. The study found the same result in 39 countries among 112 women-led companies. Whether based on their own experience as they rose to the top or a simple blindness to gender in their search for talent, women CEOs tended to appoint more women to leadership roles. To see more findings from the report, click here.
II. WHY MORE WOMEN DON’T START BUSINESSES
Despite comprising about half of the labor force in the U.S., women own only 36% of small and medium enterprises (SMEs). The percentage of women entrepreneurs is even lower in the tech industry where women own only 10% of start-ups. Women’s businesses tend to be small with themselves as the only employee. They also generate less revenues than SMEs owned by men, according to U.S census data. So, why don’t more women start businesses?
New research conducted by Third Way’s NEXT initiative provides reasons why more women are not turning to entrepreneurship. Basically, they found that people with experience mentor and give money to people like themselves, while people starting out do what they see people like themselves doing. So male entrepreneurs tend to support other men. “Women are just outside of those established networks, and, if you are outside of the networks, you don’t get the knowledge, opportunities, contacts, or funding,” said Susan Coleman, co-author the report.
Being outside of the predominantly-male networks doesn’t only affect funding opportunities, it also leads to women investing more of their own money instead of outside capital in their businesses. When they do seek investors, they ask for less.
Networks are also important for emotional support. “Launching an entrepreneurial venture is a lonely and sometimes scary undertaking,” Coleman said. “You need to have people to talk to.” Unfortunately, the researcher found that people live in their own bubbles, and they tend to connect with those who are just like them. (“Why Don’t More Women Start Businesses,” New York Times, June 11, 2017)
III. AUSTRALIA’S WORKPLACE GENDER QUOTAS
The Australian Human Rights Commission has raised the bar on workplace gender quotas with a recommendation that companies with government contracts must employ at least 40% women. This new quota, put forward by Sex Discrimination Commissioner Kate Jenkins, aims to tackle the gender pay gap which in Australia comes to women earning 16% less than men.
Companies bidding for government contracts would now need to demonstrate efforts to improve gender balance with the goal of reaching a 40:40:20 ratio in line with the Workplace Gender Equality Agency recommendations. Currently, male-dominated industries, such as construction and electricity are made up of at least 80% men.
Commissioner Jenkins has said that many benefits would come from improving the gender balance in both male and female-dominated workforces. “By improving women’s participation in male-dominated industries, we can broaden the talent pool within these industries, address skills shortages and improve the performance of organizations,” she said. (“Australian employers could soon be forced to employ more women,” Daily Telegraph, April 30, 2017)
IV. RECORD NUMBER OF WOMEN ELECTED IN UK, FRANCE
Women were the big winners in Parliamentary elections in the UK and France earlier this month. In France, a record 224 women were elected, smashing the former high-mark of 155 from 2012. Prime Minister Macron’s emphasis on equal gender selection resulted in a Cabinet that is 50% female and 47% of newly elected legislators from his Republic on the Move party being women. (“More Women, Far Younger; France’s New MPs,” AFP, June 19, 2017)
In the UK, 208 women were elected to the House of Commons — the first time over 200 women were elected in a single election year. The overall percentage of women MPs now stands at 32% for the first time. (“Record Number of Female MPs Win Seats in 2017 General Election,” The Guardian, June 9, 2017) In both countries, the new crop of women parliamentarians is more diverse in ethnicity and professional backgrounds.
These increases in women MPs in France and the UK will help push the needle on women in Parliaments globally. As of January 1, 2017, the percentage of women in Parliaments worldwide was 23.4%, with Rwanda leading the way with 61% of its legislators being women, according to the Inter-Parliamentary Union.
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