What is the Key to Having More Women in Leadership: Mentorship, Stretch Assignments, Or Quotas?

Women working toward senior-level positions face various challenges: biases, the gender pay gap, and long-standing corporate cultures that aren’t welcoming to women in the C-suite.  

Although many companies are revising their views on women in leadership, progress is still slow around the globe. A 2020 Mercer review of women in leadership found that only 29% of senior managers were women, with the percentage in executive roles even lower at 23%. 

While other statistics indicate an overall increase in the number of women in senior positions over the past few years, the pandemic negatively affected many who were on the senior track and had to (or chose to) leave their positions to become primary caregivers for home-schooled children and other family members, or as a result of company downsizing or closures.

Many agree that pandemic aside, corporate culture still evolves too slowly to indicate a significant change with regard to diversity. This is not just a “women’s issue,” as the lack of diversity in leadership affects everyone. Not only would women benefit from improvements in mentoring, pay, and opportunity in traditionally male-dominated industries but there would also be a positive financial impact on the companies involved—and, eventually, the nation’s economy.

Gender-Balanced Leadership Increases Profitability

Diversity across all spheres has been consistently shown to improve profitability. Different ideas, mindsets, and leadership styles all contribute to greater team productivity. Women are generally considered strong collaborators, communicators, and mentors, which are all necessary for an organization’s growth and success. According to McKinsey & Company, if the number of women in leadership positions equaled the number of men in leadership positions, global growth could equate to as much as $12 trillion in the next few years. In another finding, McKinsey noted that for every 10% increase we’ve seen in gender diversity, earnings before interest and taxes have risen by 3.5%.

A survey of nearly 22,000 firms from 91 countries echoed similar findings. The Peterson Institute for International Economics found net margins increased when women were at the C-Suite level. Those companies with at least 30% of female leadership could see as much as a 15% boost in profitability.

Organizations Have the Power and Resources to Increase Female Leadership

There are several ways organizations can make significant strides in increasing female leadership positions: offer equal opportunities, provide feedback and support to all, and evolve the corporate culture.

Women are recognized as strong communicators, both as team members and leaders. They are also more adept at recognizing areas where inclusion and greater empathy can add value. Mentoring relationships, both for women and by women, can be quickly formed with little or no additional resources or cost to the organization, and have benefits for both female employees and the company.

Creating a culture in which senior leadership advocates for women is another way to level the playing field. Corporate trainers and thought leaders can introduce ways to update the corporate narrative and help entire teams to see diversity as the progressive path to greater productivity and profitability.

Clear and constructive feedback is vital to growth and success, as we are able to learn from our mistakes. More frequent feedback and support outside of a yearly review will help women succeed. Research has found that, overall, women receive vague feedback more often than men. Clear metrics and expectations for both male and female employees should be a basic tenant of any company culture.  

At the same time, advocates should encourage women to step up for bigger roles and responsibilities. Often, women feel intimidated to advocate for themselves. This is where a strong leader or mentor can make a difference by helping women identify those openings and coaching them to step up and ask for the opportunity.

Corporate culture again thwarts progress by expecting women to be more qualified than men for the same positions. Standardization in hiring and promoting procedures can help rule out this unequal and often unconscious expectation to ensure that women are treated equally. 

Creating “stretch assignments” or “heat experiences” is another way in which companies can provide a challenging assignment, giving women the chance to demonstrate leadership skills and prepare for larger leadership roles. These are high-profile, often higher-risk assignments; typically, men receive more of these assignments than women.

However, setting someone up to intentionally fail is not the answer.

Overcoming the Glass Cliff Women Face

Over the past several years, a new twist has emerged. Labeled “Glass Cliff” by professors at the University of Exeter’s School of Psychology, some leadership opportunities have a high likelihood of failure—essentially, a “can’t win” situation. Research found that women are placed in these positions more often than men. 

Companies in crisis or downturn tend to hire individuals that aren’t traditional, white, male CEOs, who are then forced out when things crash. “Among CEOs leaving office over the past 10 years, a higher share of women have been forced out than men (38% of women vs. 27% of men)” These include former Yahoo CEO Carol Bartz; former head of Merrill Lynch Smith Barney, Sallie Krawcheck; former co-president of Morgan Stanley, Zoe Cruz;  and former Avon CEO, Andrea Jung. 

Women may accept these “can’t win” situations as stepping stones to better positions in the future, but this comes at a cost to their mental and physical health. In a Forbes report, Shraysi Tandon, a New York-based business reporter for CCTV America, observed that women will accept these positions because lucrative opportunities with impressive salaries and titles are more difficult to find, even if the risk of being pushed out is greater. And while there is a risk, she also agrees that women shouldn’t avoid the glass cliff, as long as they are aware that it exists.

Changing the company culture begins with senior management, which can be a double-edged sword. While talking points sound like a step in the right direction, the implementation of those ideals often falters.  

Real Steps to Increasing Women in Senior Leadership

In his remarks for International Women’s Day, UN Secretary General Antonio Guterres said gender quotas would benefit the world as more women take leadership positions. But corporations have to change their own culture and ideals moving forward.

Despite discussions of mentorship and closing the gender pay gap, countries such as Norway have implemented hiring quotas that include an emphasis on women filling senior roles. In many corporate cultures, the idea of a quota is met with pushback, bias, and even hostility. However, quotas are also seen as a positive and necessary step for women’s empowerment. The theory behind the support of quotas involves equity rather than equality. When women have for centuries been denied senior-level positions, supporters argue they must be given reserved seats today to bridge the gap. 

The United States sees any type of quota as a limitation to business growth. This differs from the resistance of European companies who argue that quotas can’t be met because of the difficulty in finding qualified candidates.

But for countries such as Norway, France, Germany, Belgium, and Italy, hiring quotas for underrepresented groups have been highly effective. 

Israel implemented gender quotas for corporate boards as early as 1999 while in 2013, India was the first developing country to require at least one female director on the board of publicly traded companies.  

Changing the conversation around quotas and their effectiveness will likely take time, just like discussions and movements on closing the gender pay gap, involving women in male-dominated fields, and other long-standing implications of the corporate culture. 

Framing the shift as a pro-active, progressive business step that focuses on the benefits women bring to an organization can decrease the bias and pushback against quotas. Improved productivity, leadership, and ultimately, profitability are all positive incentives for any organization.

However, bringing equality to the workplace takes more than a 5% increase in female positions. As shown with female directorship in Norway, reaching a point where women were well established at about 40% of the workforce took time. 

Whether quotas are in force or not, companies can and should take definitive steps to increase senior leadership opportunities for women. Implementing them is not difficult, changing the mindset and culture is. But steps should be taken now. 

Give women equal opportunities for pay, training, and advancement. Recognize their strengths and contribution to the advancement of the organization, and mentor, support, and encourage them to step forward for new or difficult assignments that will help them demonstrate their skills and abilities.

Written by Rachita Sharma.
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