October 14, 2009
"The Women Who Mean Business"
Posted by Lisa Fairfax

The Financial Times recently published what it called its “definitive ranking of the world’s 50 most powerful and successful female chief executives.” The list, created in collaboration with recruitment group Egon Zehnder Indernational, profiles executives managing the controlling company in a group—as opposed to those that oversee units, even if such units are sometimes larger than some individual companies. Since the list is global, but limited to CEOs, the list is distinct from Fortune's annual ranking of the 50 most powerful women in the U.S. However, there is some overlap. For example, PepsiCo’s Indra Nooyi held the top spot on both lists, while Avon’s Andrea Jung and Kraft Food’s Irene Rosenfeld were in the top 10 of both lists.

The Financial Times’ list highlights some interesting statistics about women in business. Hence, the article notes that just 3% of Fortune 500 chief executives are women, while across Europe only 10% of board directors of the biggest companies are female. According to Catalyst, women hold about 15% of Fortune 500 board seats, while one Wall Street Journal article notes that 12% of companies have no women directors at all. Indeed, while women have made progress in these areas, such progress has been relatively slow. Thus, in the last decade, the percentage of women Fortune 500 CEOs has gone from .4% to 3%, while the percentage of women on Fortune 500 boards has gone from 11.1% to 15.2%.

To be sure, there are lots of interesting studies and theories not just about the relative pace of that progress, but also about why it matters, from a business perspective. Indeed, the Financial Times article begins by asking a question that always appears to crop up during a financial or governance crisis: “would we be better off if more women were in charge?” On this question, the article responds in at least two ways. First, it notes evidence from studies such as those by Catalyst and McKinsey suggesting that “a better gender balance has a positive impact on performance.” Second, it notes studies indicating that boards with a better gender balance “were more assiduous at monitoring,” suggesting that diversity may help prevent “groupthink” and thereby improve corporate governance. Of course, these studies are not without their critics and skeptics.

Interestingly, the article concludes with the following: “The financial crisis has, at least, made the business and moral case for change more apparent than ever.” However, similar statements were made during the 2002 accounting and governance scandals. And yet, the percentage of women board members and CEOs has been relatively unchanged since that time.

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"Recently in the FT (HT: Lisa Fairfax), Alison Maitland and Sarah Halls rank the top 50 women in worl ..." [more] (Tracked on October 15, 2009 @ 9:36)
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