A Woman’s Place is in the Corner Office

In honor of Women’s History month, I decided to take a look at the state of women in business. At a quick glance, it would appear we have much to celebrate. Women have made great strides since the days of our parents and grandparents. Women make up half the U.S. labor force. And the future looks bright.Women outnumber men 56 percent to 44 percent on college campuses. 40 percent of businesses in the U.S. are women owned. More than 50 percent of all management and professional positions are held by women, and many of the companies being run by women are out-performing those without women heads. Look at Meg Whitman at eBay or Maxine Clarke at Build-A-Bear, and you’ll find well-compensated women running high-growth companies with great success.

But if you look more closely at the CEO’s office and compensation – especially in traditionally male-dominated sectors -- the facts reveal a more disheartening picture. Despite the number of women in management positions, we constitute fewer than 2 percent of the Fortune 500 and Fortune 1000 CEOs. Women’s presence in technology companies is particularly weak. Only 9.3 percent of the board seats in technology companies are held by women, whereas they make up 12.4 percent among Fortune 500 companies. Only 11 percent of women are corporate officers in tech firms versus 15.7 percent in Fortune 500 firms. The pay gap between men and women has narrowed, but on average women still earn less than men. A recent study coming out of the Olin School of Business at Washington University found that when participants were given resumes identical except for the names and gender of the CEO, people would pay a female CEO only 86 percent of the amount they would pay a male.

But why? We’ve seen high powered women executives run top companies successfully. Avon’s Andrea Jung, eBay’s Meg Whitman and Xerox’s Anne Mulroney are all current examples. Though it is hard to quantify, studies indicate that women-led corporations tend to be more successful than men-led corporations. So why aren’t there more females running Fortune 500 companies? The answer is threefold:

Gender bias. It exists, and it is the most powerful force against women in business. The Olin School of Business study found that people overwhelmingly believe that women CEO’s are less able to handle a crisis, less competent, and less favorable public faces. Investors more readily back male-run firms over female-run firms, despite statistics showing that companies led by women CEO’s have high levels of success. The study also found that stereotypes about women CEOs created obstacles to going public. This is a very serious problem because companies need to be able to tap into the equity market to grow. A company’s board members may support a male candidate over a female for CEO subconsciously because they inherently know what the research has found: Investors favor companies with a man at the helm. Participants in the Olin study indicated they'd invest 300 percent more in a firm run by a male than in a firm run by a female.

Family needs. Women start their ascent to the top, but usually must put their goals on hold if they also wish to have children. When they take the time off to start a family, they often find that corporations make it difficult for them to resume where they left off, or to return at all. I have a close friend who was treated with disrespect when she returned to her high-powered law firm after having a child. She said it was like a nightmare. When she checked with her other friends, they all concurred. This “happens to the best of us,” she told me. Our careers are “over once we have that baby.” Often, a woman’s desire to pursue family and career is perceived by the corporate world as a lack of commitment. Sometimes it stirs resentment from other women who aren’t taking the path of motherhood and in those cases, our own sisters are cutting us off from the support we need in the office.

Lack of networks and support structures. Despite the negative statistics, companies have a long way to go in improving corporate attitudes towards women. Little attention is paid to the issue of gender bias and little is done to recognize the very educated and valuable women in the workforce. Mentors are not readily available. I have my own theory that American business is built by hard working and determined men and women. Then, all too often, when women reach about 30 to 33 years old, they invariably drop out of the work force at just the time that their career would take-off and bring them the fruits of their labor. Men are no longer competing against women and find themselves floating up the chain of command.

Despite the obstacles facing women, there is cause for hope. As a woman in business today, what can you do to help fight the gender bias and succeed? See my Nine Key Steps.

As more and more women-led companies succeed, we can expect that the money they are making for their shareholders will erode built-in bias. Money talks, right? Successful corporations are starting to recognize that women’s talents are underutilized, and are creating programs to help females within their ranks. With the flexibility gained by advancements in telecommunications, women may be able to spend more time at home with their children while still being a presence back on the job. High profile female executives are creating new role models. Their resilience in an adversarial climate and their creative leadership strategies are paving the way for the next generation of women leaders. It isn’t easy, but it is possible.

Hilary Kramer is a Financial Editor for AOL and top authority on investing and personal finance. She has appeared regularly on Fox News and CNBC, writes for the New York Post and served on the Wall Street Journal Women in Business Board. Hilary was an investment banker at Lehman Brothers and Morgan Stanley, and Senior Managing Director of the Cisneros Group. She is president of A&G Capital and appears daily on the national radio show Doug Stephan's Good Day. Visit her at hilarykramer.com.