Today out of the largest 3,000 publicly traded companies in the United States, only 140 (4.6%) are led by a female Chief Executive Officer. Times are changing though with new research highlighting that women are now being selected for CEO roles at a near historic pace.
Traditionally, company board of directors only considered candidates for CEO positions that had CEO experience. Harvard researchers uncovered a compelling new trend, a 40% increase of freshman female board members last year. Data shows that 24% of director roles are now staffed by female team members. Not only are females making their way to top leadership roles at companies, they are doing it at a younger age with 17% of female board members 50 years or younger.
How does this transition to an increase in female CEO? Board rooms across the country are realizing that women who have meaningful board experience (but no CEO experience) are terrific CEO candidates. The logic makes sense, given that CEOs report to boards… leading to the conclusion that female board members hold unique career experience that can be very effective in other top leadership roles like in the C suite.
Harvard’s research issues a data driven challenge to the modern day executive team to consider a border profile for potential CEO candidates. Individuals with leadership experiences as EVP or president roles and also board experience should be equated in combination in terms of equivalent CEO experience. Analysing the data, Harvard researchers point out that board executive search committees should evolve the outdated criteria and embrace efficient new age thinking, by simply looking around the boardroom table and selecting a fellow board member for the CEO job.
This approach can be powerful given that many boards know the problems and the company’s priority growth avenues for priority focus at an intimate level. Bringing in a new CEO from outside the company (man or woman) naturally discombobulates corporate culture as the CEO navigates the sometimes turbulent learning curve of being a new boss.
To further increase candidate pools of high potential women for executive roles, new programs are also being launched to mentor and groom female candidates for CEO leadership roles. Traditionally programs like this were dominated by men under the now rather uncouth Boys Club mentality yesteryear. Harvard outlines this study of female CEOs and their career track from boards to C-Suite is a first of its kind. With men dominating 95% of CEO roles, Harvard’s study on female CEOs’ path from the boardroom to chief executive is a success trend which women can learn about and put into action for their individual corporate leadership journey.
We at Treehill observe a large benefit to corporate stakeholders being opened up at client companies where gender diversity is progressed forcefully and with a broad horizon of identifying those individuals who are truly fit for the roles, tasks and challenges at hand.
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Read more about Harvard’s study on female CEO trends: https://hbr.org/2019/07/research-board-experience-is-helping-more-women-get-ceo-jobs