Higher numbers of C-suite women can reshape attitudes about careers and have an impact on women and men throughout the organization
Companies run differently when more women hold power.
In the management suites of Adobe Systems Inc., ADBE -0.07% Best Buy Co. , Target Corp. TGT -0.20% , Gap Inc. GPS -0.51% andKimberly-Clark Corp. KMB -0.56% , women occupy as many as five of eight spots on the male chief executive’s leadership team. These female executives often serve as role models for other women in the company. They push for better diversity practices and help men overcome hidden biases.
They also are reshaping attitudes about how women’s careers progress, and championing nontraditional ways to get ahead.
Change is coming slowly, but corner offices are looking a bit less like exclusive boys’ clubs lately. At S&P 500 companies with men in command, 11.9% of the four other highest-paid officers are women, up about four percentage points from a decade earlier, according to an analysis for The Wall Street Journal by researchers Equilar Inc. Overall, 19% of C-suite executives are female—a slight increase from 17% in 2015, according to an analysis by McKinsey & Co. and LeanIn.Org.
The increased ranks of executive-suite women could portend further gains for their female associates. “The more women who are in positions of power visibly, the better it is for women lower in the organization,’’ says Robin Ely, a Harvard Business School professor and gender researcher.
Companies with more women in senior management tend to pay more attention to their viewpoints and advancement needs. “When it’s only one or two women, our voices can get lost,” says Liz Gottung, who heads human resources at Kimberly-Clark. At the consumer-products maker, five of CEO Tom Falk’s eight direct reports are women.
Five of 10 executives reporting to Best Buy CEO Hubert Joly are female. They include Corie Barry, promoted to chief financial officer in June. The electronics retailer chose her mainly because her predecessor, Sharon McCollam, actively sponsored her. Both genders consider high-level sponsorship essential to their corporate success, the Lean In/McKinsey analysis showed.
Ms. McCollam started grooming Ms. Barry, a divisional finance vice president, soon after joining Best Buy as its first female finance chief in late 2012. The following spring, Ms. Barry advanced to senior vice president of domestic finance, a powerful new position.
“I do not believe I would have ever gotten that role without Sharon’s advocacy,’’ Ms. Barry says. A woman positioned high up “can help bring other women to her level.’’
As Ms. Barry’s new superior, Ms. McCollam surprised her in August 2013 by saying she could be the next CFO if she polished certain skills. The finance chief urged Ms. Barry to have the courage to take contradictory points of view during crucial conversations and to deepen her involvement in investor relations and other key areas.
Ms. Barry performed well. In late 2014, she says, Ms. McCollam declared, “You are the front-runner to be my replacement.”
Ms. Barry became chief strategic growth officer and Mr. Joly’s fourth female lieutenant last October. She says Ms. McCollam continued coaching her, even critiquing her inadequate pushback five minutes after a meeting ended. Ms. Barry “will be an incredible CFO,’’ Ms. McCollam said in Best Buy’s announcement about their transition. She declined to comment further.
At Adobe, CEO Shantanu Narayen commands a management team of three women and six men. The software maker’s highest female executives frequently swap tips about balancing work and home demands, such as fast weeknight dinner menus. Gloria Chen says she approached Donna Morris, a fellow working mother, before requesting Mr. Narayen’s approval to leave at 5 p.m. once her son began middle school Aug. 23.
“Donna was very supportive’’ and asked whether that departure would give her enough time at home, recalls Ms. Chen, a vice president with a four-day schedule since 2010. Mr. Narayen approved.
Ms. Morris, an executive vice president in charge of human resources, wrote an Adobe blog post about her early departure for Thursday “date nights” with her son when he entered high school several years ago. Their dates forced her to reschedule 8:30 p.m. Thursday calls with India colleagues. Many employees praised her for carving out family time, she says.
The Adobe executive believes that informing the entire company about her weekly early exits strongly signaled how lower-level women can succeed. “You have to integrate your work with the life you have,” she says.
Similarly, Ms. Morris persuaded Mr. Narayen to sweeten paid parental leave for U.S. staffers last year. The improvement typified how “Adobe’s top executive women make sure that diversity and inclusion are a core part of our corporate mission,’’ she says.
Women and profits
Companies with higher proportions of women in upper management achieve higher profits, according to a recent study of 21,980 firms in 91 countries by the Peterson Institute for International Economics. Profitable firms where women represent 30% of leaders saw a 15% increase in one measure of gross profit, researchers estimated.
There may be less stereotypical thinking, too. At Kimberly-Clark, for example, Ms. Gottung says that after more women were in executive positions, a noticeable change took place in some high-level discussions about whether to offer transfers to certain women managers.
Some of the women had been asked before but resisted, because their husbands owned local businesses, for instance. This, Ms. Gottung recalls, led some of the male executives to ask why those women would be willing to leave now. To which the women in the room responded: “Ask again. Maybe we are stereotyping this person.’’
More than half of the individuals whom the company assumed were reluctant to move actually did relocate. “We have found ourselves amazed,’’ Ms. Gottung reports.
In hindsight, she adds, Kimberly-Clark executives realized that “women are better at saying, ‘Maybe we are wrong.’ ’’