Men re­plac­ing women as CEOs marks step back­ward

A com­pany’s di­rec­tion on di­ver­sity comes from a mostly white board

The Hamilton Spectator - - BUSINESS - JEFF GREEN AND JORDYN HOL­MAN Bloomberg

When Mon­delez In­ter­na­tional said Wed­nes­day that CEO Irene Rosen­feld was re­tir­ing, it was no sur­prise that the food com­pany also an­nounced that she would be suc­ceeded by a man.

Since 2009, 19 fe­male CEOs of Stan­dard & Poor’s 500 com­pa­nies have stepped down. In only three of those cases was she re­placed by an­other woman, ac­cord­ing to data com­piled by Bloomberg. Rosen­feld, 64, will re­tire in Novem­ber and will be suc­ceeded by Dirk Van de Put, who cur­rently leads McCain Foods.

“It un­der­scores just how truly ex­cep­tional it is for a woman CEO to be suc­ceeded by an­other woman,” said Brande Stellings, se­nior vice-pres­i­dent of ad­vi­sory ser­vices at Cat­a­lyst, which tracks di­ver­sity in com­pa­nies.

“Since we had the first woman CEO in the For­tune 500 in 1972, there’s only been 62 women CEOs in to­tal, which is pretty stag­ger­ing.”

McKin­sey & Co. and other con­sul­tants are pro­vid­ing a grow­ing body of re­search that in­di­cates that com­pa­nies that shift away from a mono­lithic white male lead­er­ship out­per­form those that haven’t changed their com­plex­ion. Still, most mea­sures of di­ver­sity have been largely un­changed for a decade.

The di­rec­tion a com­pany takes on di­ver­sity comes from its board room, where white men have dom­i­nated since the past cen­tury. When choos­ing a new CEO, board mem­bers tend to rely more of­ten on peo­ple they know than on ex­ec­u­tives se­lected by re­cruiters who screen can­di­dates from a wider field, said Trina Gor­don, CEO of ex­ec­u­tive search firm Boy­den. About 80 per cent of S&P 500 di­rec­tors are men.

“Boards are still not very di­verse, and if you don’t have di­ver­sity at the gov­er­nance level, there’s not a lot of changes that are go­ing to hap­pen,” Gor­don said.

Women, who make up about half of the U.S. work­force, aren’t fore­cast to gain par­ity in the board room un­til 2032, ac­cord­ing to a June es­ti­mate from ex­ec­u­tive re­cruiter Hei­drick & Strug­gles.

De­bra Crew’s pro­mo­tion to suc­ceed Su­san Cameron as CEO at Reynolds Amer­i­can ear­lier this year was the first fe­male-to-fe­male han­dover in the S&P 500 in five years, ac­cord­ing to data from re­cruiter Spencer Stu­art. The dis­tinc­tion was short-lived be­cause even be­fore she took the job, Bri­tish Amer­i­can To­bacco said it would buy Reynolds. Now Crew re­ports to BAT CEO Ni­can­dro Du­rante.

Prior to that tran­si­tion, the last time a fe­male CEO was re­placed by an­other woman was in 2012, when Sheri McCoy suc­ceeded An­drea Jung at Avon Prod­ucts. McCoy an­nounced her res­ig­na­tion Thurs­day from Avon, which is no longer in the S&P 500. A suc­ces­sor hasn’t been named.

Fe­male CEOs are judged dif­fer­ently than men, an­other hur­dle women face on the path to the C-suite, said Bar­bara An­nis, found­ing part­ner of Gen­der In­tel­li­gence. Re­search shows that women are judged on per­for­mance, while men are given op­por­tu­ni­ties based on their po­ten­tial, she said.

BLOOMBERG FILE PHOTO

Mon­delez In­ter­na­tional CEO Irene Rosen­feld will be suc­ceeded by a man when she re­tires in Novem­ber.

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