Appearances That Deceive

Appearances That Deceive

Does the way you look matter when it comes to leadership? David Bolchover argues that similar looking CEOs reflects sameness in thinking.

The proportion of women chief executives (CEOs) among the largest companies is very similar in the United Kingdom and the United States. Just five percent of CEOs at FTSE 100 companies, and 6.4 percent at Fortune 500 companies, are female. But it’s not just women who are disadvantaged. Ethnic minorities also suffer similarly low representation in the corridors of corporate power, as do short, ugly men with high-pitched voices.

In research for his 2005 book, “Blink”, Malcolm Gladwell found that 30% of CEOs of Fortune 500 companies were 6 feet 2 inches or taller, though they comprised less than 4% of the American male population. Daniel Hamermesh, a professor of Economics at the University of London, found that attractive people will on average earn 3-4% more than their less-blessed colleagues. And a 2013 study by Duke University and the University of California at San Diego showed that the deeper the voices of the 792 male CEOs surveyed, the more they earned. Presumably, the male falsettos among the workforce are failing to make the boardroom at all.

There are two ways to spin these statistics. Many economists claim that there are rational market-based explanations for such discrepancies. Others argue that this is the inevitable result of a modern-day knowledge economy in which objective measurement of individual performance is almost impossible. Either way, presenting the right image is the essential prerequisite for career success.

According to the market-based rationale, women are at a disadvantage in the workplace because they take crucial years out of their careers to raise children. When they return to work, and with young offspring still at home, they might not want to put in the necessary time to reach the top.

Voices of authority

Those who believe that the corporate world, especially at senior levels, works according to strictly meritocratic principles might also add that tall, attractive or perhaps deep-voiced men are more likely to make better executives. Supposedly, employees and investors are more inclined to take notice when a tall male speaks—especially in a deep voice.

Although difficult to dismiss out of hand, these arguments contain significant weaknesses. The notion that women in their 30s and 40s are all running around after children is at the very least outdated. According to the Office for National Statistics, one in five women in the United Kingdom remains childless, with no need for a career break, while almost half of families (47 percent) have only one child. In her book “Lean In”, Sheryl Sandberg quotes a survey stating that “43% of highly qualified women (in the United States) with children are leaving careers or off-ramping for a period of time.” Which means that 57% don’t. In other words, when it comes to female under- representation in the boardroom, the ‘career break’ argument is somewhat unconvincing.

‘Diversity in the boardroom is a strong indication to investors and potential employees that the company is a cut above the rest.’

Are tall men with deep voices really going to make better decisions, or devise superior strategies? That they predominate in senior roles suggests that talent is not the major determinant of career success in many large corporates. More likely, they are promoted because it is extremely difficult to distinguish among the many people who could do the job perfectly well. Unconsciously perhaps, the recruiting committee selects the person with who looks most like a leader, along with the essential mannerisms and tone of voice.

The selected leaders in large companies reflect the sameness of their employers. On the other hand, if a company really has something different to shout about, then surely you are more likely to appoint the leader who can articulate this with the greatest enthusiasm and precision. That’s when women, short men and ethnic minorities get a fairer crack of the whip.

Mark Zuckerberg, Sergey Brin and Jeff Bezos are around 5 foot 8 inches tall. Indeed, the great entrepreneurs come in all shapes, sizes and creeds. Diversity in the boardroom should not just be celebrated for its own sake, or as is often suggested, because a diverse customer base might be better served. It’s also a strong indication to investors and potential employees that the company is a cut above the rest.

David Bolchover is an award-winning business journalist and author of three books on management and the workplace.

This article was written for Headspring Executive Development, formerly known as Financial Times | IE Business school Corporate Learning Alliance.

The Gender Tension Gap: addressing motivational barriers

The Gender Tension Gap: addressing motivational barriers

Women at work must identify and address inherited motivational barriers that prevent them from realising their true leadership potential, argues Dr Celia de Anca.

One might wonder why the UK’s 20% gender pay gap among senior executives has not narrowed after two decades. While ‘external’ barriers, such as the lack of childcare support, social pressures and restrictive laws explain much of the difference, there is also a wide range of ‘internal’ barriers such as lack of self-confidence, passive expectations of pay and promotion, and guilt over time spent away from children to consider.

These deeply embedded motivational barriers, many of which have been passed down for generations, are at odds with the modern aspirations of women. The resulting internal tensions they create prevent women from realising their true leadership potential.

This can be better understood as part of a gender tension gap (GTG) model, which measures five dimensions of professional women’s lives: success, career journey, leadership, competencies, and reputation and identity. Three key observations emerge:

– that the gap between traditional and emerging gender expectations may be easy to identify but

– tensions created between present and aspirational gender expectations are not easily recognised; and

– that there is a wide diversity of those aspirational models.

The GTG is not correlated with economic development, but historically and culturally rooted. The early division of gender roles dates back to the agricultural revolution and evolved into enlightenment concepts of citizenship based around a male centred household. These norms were only seriously challenged in the 20th century. ‘How unpleasant it is to be locked out’ reflected writer Virginia Woolf on male-dominated institutions, before adding that ‘it is worse perhaps to be locked in.’

The failure to recognise the tensions arising from these incongruous traditional and future expectations have always carried consequences—whether it’s the disappearance of women in music after composition became more ‘mathematical’ (or masculine) in the 18th century, or more recently the loss of women in the video games industry. But how does this happen?

Consider, for example, the female response to work-place stress such as having a difficult boss. Most men would soldier on or seek another job. But many women seriously consider leaving work altogether to focus on home life. This is not to suggest that men (especially those from poorer or minority backgrounds) do not struggle with inherited cultural norms of their own, particularly to be the family breadwinner. Yet when it comes to career, they tend to retain a ‘linear’ perception of success (e.g. to be manager by age 30, director at 40 etc.) while women tend to be linear in their view of domestic success (i.e. first child by 30, family complete by 36 etc.). The question is whether this attitude represents an authentic choice or a cultural holdover?

Equality through authenticity

Women’s career challenge therefore lies in Kafka’s reference to ‘living in the present’ which requires women come to terms with the past while simultaneously preparing to fight for the future. Women may have inherited a normative model from their parents and grandparents. But in challenging these expectations they can establish a multiplicity of future models, including those that place individuality above gender. Moreover, typical internal barriers may change over time as women adopt less conventional family lifestyles or perhaps choose not to have children. It may even be that rebellious daughters reject their mothers’ quest for workplace equality, and decide to work part time or be stay-at-home mothers.

The path to equality may not run smooth. But determining authentic motivations (in men as well as women) through the gender tension gap model will help women better define what they are struggling against.

Celia De Anca is Professor of Global Diversity at Spain’s IE Business School. A version of this article first appeared in Financial Times | IE Business School Corporate Learning Alliance.

Challenging Talent Myths and Realities

Challenging Talent Myths and Realities

We often hear about the war for talent, but are companies looking in the wrong places for the best recruits?

By Paul Lewis

For years, companies have been falling over themselves to attract and retain millennials (i.e. those in their 20s and early 30s) who we are told will skip jobs at the slightest hint of corporate conventionality. Yet the evidence suggests otherwise: a recent Manpower survey in 25 countries, for example, shows that for the vast majority of millennials job security is paramount. Similarly, companies too often pay top dollar for a CEO, despite little measurable proof of performance, fearing that he (it’s seldom she) might leave if not remunerated in the top quartile of his peers.

While companies mistakenly indulge some favoured groups – who probably won’t leave anyway – some firms are starting to acknowledge the existence of other, untapped talent pools that with some flexibility might solve these talent challenges. One obvious example is women who have left work to bring up a family and find themselves permanently shut out of their chosen profession. Many retain useful knowledge from previous jobs, and have picked up additional organisational and academic skills during their time out, to say nothing of a highly developed emotional intelligence. Their abilities far outstretch those of inexperienced graduates or school leavers who they are now expected to compete against.

According to the Financial Times, some companies are now starting to experiment with so-called ‘returnships’ in an effort to access unused talent pool estimated to be worth some £50bn a year in the UK. Returnships were pioneered in 2008 by the late Brenda Barnes, a former chief executive at food company Sara Lee, who believed that middle-aged women returning to work would bring a fresh perspective and reflect more diverse clients and customers. There is a ‘massive pool of highly skilled people who want to return to work,’ says Julie Thornton, head of human resources at Tideway, an engineering company that is targeting gender parity by 2023. KPMG estimates that there are 96 million skilled women aged 30-54 worldwide on career breaks, over half of whom have management experience. Vodafone is launching its ReConnect programme in 26 countries. Telecoms group O2 runs an 11-week ‘Career Returners’ programme which partners returnees with a young recruit to help acquaint them with new technology. Lloyds Bank’s 10-week programme provides returnees with personal coaching, mentoring and bespoke training to help them re-acclimatise to roles and boost confidence. Many participants are then able to return to similar jobs held in their early careers (though often at a lower pay rate).

As well as gender, another overlooked source of talent relates to social class. Another FT article, How social class can affect your pay, suggests the existence in the UK of a ‘class ceiling’ in elite professions. Despite efforts of some firms to recruit from a broader range of social backgrounds, research from the London School of Economics reveals widening pay disparities between social classes as careers progress. It reports that upper-middle class professionals end up earning one fifth more than working class professional peers.

There may be practical reasons for the disparities. Those from elite schools and an upper-middle class upbringing may bring social connections that help win business. But snobbery or a preference for what’s familiar also plays a big part in recruitment decisions – an advantage that, relatively speaking, also benefits women from such privileged backgrounds. Indeed, according to the LSE research the class divide is worse among women.

There may be psychological factors at play. Many executives from working class backgrounds are anxious to fit in, and –especially in the case of women – may feel less entitled to ask for pay rises or promotions. The problem becomes worse when minority ethnic backgrounds are thrown into the mix. As a result, it is the exceptions who prove the rule: socially under-privileged women who do reach senior positions tend to perform better than their peers, but largely because they have had to be better and work harder than their peers.

Employers, especially those who complain about the war for talent, would do well to recognise and then make way for alternative talent pools. Levelling the playing field need not be about concepts of social justice – which many executives may feel unqualified to debate – but rather about spotting untapped value which after all is the very purpose of business.

There is an understandable temptation to use social and educational cues, as much rely on outdated assumptions about gender, as a shortcut during what is often a superficial recruitment process. The problem is that employees come to rely on these signals that may prove to have limited value in practice. Even where ‘social capital’ does provide an initial advantage, this usually diminishes rapidly especially given that most executive jobs do not require heightened social or intellectual qualities. It does not require a huge leap of imagination to see that how taking a broader view on gender, class and ethnicity widens the benefits to business too.

Read more from FT | IE Corporate Learning Alliance at www.ftiecla.com

Paying Attention to the Gender Pay Gap

Paying Attention to the Gender Pay Gap

The gender pay gap is a symptom of deeper corporate failings around careers.

By Paul Lewis

Gender pay disparities in the UK have become a controversial topic, fuelled recently by revelations that the BBC’s female reporters and presenters were being paid significantly less than their male counterparts. The highest paid presenters were all men, despite no measurable superiority in performance, though some accepted a pay cut to help stem the outrage. Large public companies are now required to publish gender pay differentials. In 2018, it reported that more than three-quarters are paying women less than men on average. Many have found convenient explanations for the difference.

Perhaps one way to understand why this should be is to consider a popular mantra of bankers during bonus season: ‘If they don’t pay you what you want, will you leave; and if you leave do they care? Nothing else matters.’ For employers, achieving pay equality is not the central issue. Their main concern is to determine how much the employee is really willing to work for, irrespective of whether it is lower or higher than the norm.

When top salaries are negotiable (as opposed to lower-paid jobs with fixed rates and hours) the insistence on pay equality distorts expectations. Few of us would embrace the principle of equality if that meant taking a pay cut. And we don’t mind varying pay rates to, say, our gardeners, babysitters or even freelance journalists, according to what they will accept.

In permanent jobs too, many factors that are not rooted in corporate bias contribute to pay disparities: from the eager job candidate who suddenly toughens up when salary is broached, to the long-serving staff member who has profited from compounding annual pay rises.

Just walk away

But a more important factor determining pay premiums or discounts is the employee’s ‘walkaway’ price—i.e. the point where a job applicant will genuinely turn down a desirable position over salary. Your current or future employer will probably not try to second guess the many personal reasons why you set the limit where you do; only whether it is genuine or a bluff. For example, the company would never suggest you get less money because you have a well-off spouse, even if this is indeed the reason you end up accepting a less generous deal. It’s for you, not the company, to make that decision.

You may, for example, accept a pay discount in order to work for a prestigious brand. However, its social value is highly subjective—not everyone will value so highly as you. Alternatively, you might place a premium on family time and will only forgo this for much more money. Others want to work with clever or pleasant colleagues. Research suggests that a congenial working environment may be equivalent, in happiness terms, to a 40% pay rise. But some would prefer the extra money to the extra happiness.

‘A large factor determining pay differences is your ‘walkaway’ price—i.e. the point where you genuinely turn down a desirable job offer over salary.’

Another major issue to consider, and which is often used to explain part of the gender pay gap, is the ‘breadwinner’ factor. A journalist friend, who had always disliked public relations, recently asked me to write him a reference for a job in PR. I congratulated him heartily: I deduced, correctly, that his wife must be pregnant. Having calculated that he wouldn’t be able to buy a family home on a journalist salary he had resolved to leave the job for any one that paid more. This was no bluff. Eventually, his employer relented and paid him what he needed to stay. Had he been single or his partner wealthy he admits that he would have accepted the newspaper’s initial low offer.

Nowhere to go

Applying the ‘walkaway’ principle, as opposed to the ‘equality’ principle in your pay negotiations (even at the risk of huge resentment should the truth ever emerge) assumes, however, that you have somewhere to walk away to. For women, not to mention ethnic minorities or those from working class backgrounds, the options at senior levels are limited. The FT reports that average earnings for the five female FTSE 100 chief executives is around half the equivalent for their 95 male counterparts. The tiny number of senior positions held by women will almost certainly have affected their walkaway price. Having overcome substantial bias to land a top job, many women will be less willing to leave over unfair pay. By contrast, and especially in knowledge-economy jobs where performance is hard to measure, pay and promotions appear to favour those who ‘look the part,’ at least according to the white, male, middle-class bosses who typically make the decisions.

The lack of equal access to the top jobs may be the biggest obstacle to equal pay. Some even view the pay disparity as a temporary cost for female executives of smashing the glass ceiling. The sour joke is still potent today: ‘Women. Like men, but cheaper.’

Read more from FT | IE Corporate Learning Alliance at www.ftiecla.com