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The Fattest-Paycheck Club: Still All-Male

When her efforts to reap the full rewards of a career at Wall Street brokerage houses bumped up against the widespread sexism of the early 1960s, Marion O. Sandler decided to map another route to the top. "Every time I would bring up the subject of partnership, the answer was, 'Don't be ridiculous -- you're a woman,'" she recalls. "My philosophy has always been that if you're in a situation where you find a glass ceiling, get out of it."

Forty years later, Sandler is co-CEO of a large savings-and-loan holding company, and she takes home the pay to prove it. Last year, Sandler, who heads Golden West Financial Corp., which she founded with her husband in 1963, was one of the well-rewarded businesswomen in America, earning about $4 million.

NOT EVEN CLOSE. And yet, once again, Sandler finds herself in the company of a precious few. Despite a quarter-century-long march into the workforce, women still are a paltry 4% of top earners in Corporate America, based on total compensation figures for the highest-earning executives at 723 large-, medium-, and small-cap companies. The numbers, taken from the most recent proxy statements of the companies, were compiled by Execucomp and produced by Standard & Poor's Institutional Market Services, a division of The McGraw-Hill Companies, as is BusinessWeek Online. For women, "there's been progress, and I think it's important to recognize that," says Debra Meyerson, a Stanford University visiting professor who studies gender and work issues. "But [at the top of Corporate America], it isn't even close to comparable."

Just look at the numbers (see BW, 04/16/01, "Special Report: Executive Pay"). The yearend statements list about 3,800 top earners -- CEOs, COOs, executive vice-presidents, and other corporate bigwigs. Some 157 of them -- 4.1% -- are women. They've made some gains. In 1994, the earliest year for which roughly comparable figures are available, the high-earners' club was only 1.8% female.

Still, of the 50 top earners last year, all were men. Indeed, the highest-paid woman on the list, Heather Killen, a senior vice-president at Yahoo!,

is No. 78, with compensation of about $33 million (see table). Compare that to the executive who made the biggest haul: John Reed, former co-CEO of Citigroup, who reaped about $293 million. The bottom line: Even the highest-paid women in corporations lag behind their male counterparts when it comes to pay. The average size of the compensation packages for the 3,644 high-earning men listed on the proxy statements was about $4.4 million. For the 157 women execs, it was $2.4 million, or 54% of the male take, according to S&P.

MORE MANAGERS. The failure of women, so far, to command the big bucks showered on men comes despite steady female advancement up the corporate ladder. In 1998, the last year for which figures were available, 33% of the managers and other administrators at companies with more than 100 employees were women, up from 28% in 1990, according to the U.S. Equal Employment Opportunity Commission.

So, what's going on? Some answers are obvious. Women still confront the

difficulties of any newcomer trying to break into an age-old clique. And they

continue to face some outright discrimination, although in most workplaces today, the "ridiculous" comment hurled at Sandler four decades ago would be unthinkable -- to say nothing of actionable.

But generally, the difficulties facing women who occupy the corner office are more complex than those of a generation ago. One is the skewed business experience many accumulate as they move up in a corporation. Women are prominent in top staff jobs, such as head of human resources, but still scarce in the "line," or core-business, positions essential to the resume of any would-be CEO.

PROFIT-AND-LOSS PROBLEM. Again, numbers tell the story. Of the line jobs held by corporate officers at Fortune 500 companies last year, fully 93% were occupied by men, according to a study by Catalyst, a New York City group that researches women's business issues. "A lot of women just haven't got that profit-and-loss responsibility, and that's hindering us," says Carol Gallagher, founder of the Executive Women's Alliance, an association of about 2,500 senior-executive women.

The result is that few women wear the CEO mantle. Look at the list of the 20 top earners in this year's pay review: They're all male, and 14 are CEOs. Of all the women in the pay review, by contrast, six are company chiefs.

Then there's the big issue of life beyond the job. Work for almost any high-ranking executive today is a 24/7 production -- and the job apparently exacts an even bigger toll on the social lives of women than it does on men. A University of Michigan Business School study conducted with Catalyst last year found that women who had worked full-time without interruption after receiving MBAs from well-regarded programs were far less likely to be married or to have children than their male counterparts.

ROLE CONFUSION. The statistics are dramatic: Only 22% of the women had children, for example, compared with 70% of the men. "It has been difficult for women to determine their roles, as professional women and family members, as mothers and caretakers," concludes one woman who has made it to the top, Jean Hamilton, CEO of the Prudential Institutional unit of Prudential Insurance Co.

A related issue is time off. The University of Michigan study found that women MBAs were more likely than men to have taken time off from their careers, which can be a fatal misstep for those aspiring to reach the pinnacle of corporate life. "They lose the credibility and the momentum they've built up," says Patricia Cornish, president of Business & Professional Women/USA, a Washington-based association of working women.

And then there are the problems any neophyte faces in learning the ropes. Some women are hampered by a lack of savvy when it comes to negotiating key job terms, from pay to responsibilities, says Joan Kelly, a senior consultant in the women's leadership practice for management consultant William M. Mercer. One example: Executives who serve as outside directors on corporate boards burnish their employers' reputations, while boosting their own careers. Many men not only understand this but insist that their board responsibilities be considered part of their regular jobs. Fewer women seem to be in on this rite, Kelly says.

FAMILIAR LITANY. So, what's to be done? Experts offer a familiar litany of answers: more strenuous efforts to get women into line jobs, programs to assist in the work/family juggling act, examinations of corporate culture to root out subtle sources of bias.

Others see hope in a generation of businesses born long after Sandler's Wall

Street foray. "One thing that made me seek out biotechnology vs. big

pharmaceutical was both the environment -- the energy, the faster pace -- but

also the culture perhaps was more a meritocracy than you have in big

organizations that have been around for a long time," says Peggy Philips, chief operating officer and executive vice-president at Immunex Corp.

For her part, Sandler, who runs a corporation that last year made the "top

companies for executive women" list in Working Woman magazine, believes leading by example helps. But she isn't just talking about her own title. Golden West is one of the few major companies with a board that has more women on it than men. "We're making a statement," Sandler says.

One the vast majority of Corporate America has yet to heed.


Top 10 earners in 2000*




Earnings in Millions

John Reed

former chmn. & co-CEO, Citigroup


Raymond Lane

former pres. & COO, Oracle


Sanford Weill

chmn. & CEO, Citigroup


Gerald Levin

CEO, AOL Time Warner


John Chambers

pres. & CEO, Cisco Systems


Jeffrey Raikes

group v-p., Microsoft


Kenneth Lay

chmn., Enron Corp.


Henry Silverman

chmn., pres., & CEO, Cendant


Ronald LeMay

pres. & COO, Sprint FON Group


L. Dennis Kozlowski

chmn. & CEO, Tyco International





Earnings in Millions

Heather Killen

sr. v-p., Yahoo!


Dawn Lepore

vice-chmn., exec. v-p., Charles Schwab


M. Zita Cobb

exec. v-p., JDS Uniphase


Susan Desmond-Hellmann

exec. v-p., Genentech


Terri Dial

group exec. v-p., Wells Fargo


Janice Roberts

former sr. v-p., 3Com


Lois Juliber

COO, Colgate-Palmolive Co.


Donna Birks

former exec. v-p. & CFO, Adaptive Broadband


Deborah Hopkins

exec. v-p. & CFO, Lucent


Leslie Tortora

chief information officer, Goldman Sachs


*Earnings include salary, bonus, exercised stock options,

restricted shares, and long-term incentive payments.

Data: Execucomp and Standard & Poor's Institutional Market

Services, a division of The McGraw-Hill Companies.

By Pamela Mendels in New York

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