Men replacing women as CEOs marks step backward
A company’s direction on diversity comes from a mostly white board
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.