Corporate Women

"I don't sense a lot of progress has been made in terms of women moving up in business. That hasn't changed in a decade or more. It's the power structure that doesn't allow women entry."

--Marion O. Sandler, co-CEO and president, Golden West Financial Corp.

"I have never felt that my sex has been a disadvantage to me. There's a lot of discussion that men won't give adequate clout or power to women. Women share an equal burden for that. No one can expect to be handed power."

--Carleton S. Fiorina, Network Systems vice-president for strategy and market development at American Telephone & Telegraph Co.

It's not surprising that these contradictory views coexist as statements of the times. The times themselves are contradictory. Women are entering companies in record numbers, women are leaving companies in record numbers. There are more females on corporate boards, there are fewer female CEOs. It's the kind of era in which a major company receives an award for its training programs from a women's group and loses a $7 million sex discrimination suit--in the same month.

Such polarization mirrors the growing ferment over feminism itself. Women disagree on how much progress they have made in the 1980s--or if they have made any: Susan Faludi, author of the provocative best-seller, Backlash: The Undeclared War Against American Women, argues that women have actually lost ground in the past decade. And even those who agree about women's progress (or lack thereof) debate about how best to further the cause, with attitudes ranging from just-do-your-job-well laissez-faire to a call for renewing activist tactics. The debate gets so heated because sexual discrimination is insidious, and when inequality is not overtly acknowledged, it's harder to openly address. "We're still at the stage where it's a novelty to have a woman promoted," says Faludi. "And that means the playing field is not level for women."

That sense of inequality is pervasive among America's women executives, to judge by a recent BUSINESS WEEK survey of 400 female managers. While half the respondents believe that Corporate America is doing "somewhat better" in terms of hiring and promoting women, half also believe that the rate of progress is slowing. Compared with the sentiments expressed in a similar BW poll in 1990, the sentiment is more downcast now. Today, 70% of those polled see the male-dominated corporate culture as an obstacle to their success. Two years ago, only 60% thought so. More than one-third of the respondents thought that in five years time the number of female senior executives at their companies will have remained the same or fallen.

Women aren't stewing in silence, however. Three-quarters of the respondents thought women should take legal action if they see evidence of discrimination. Fully 70% also felt women should take a strong public stand on the hiring and promotion of women executives. "Clearly, there's a lot of frustration among women in the system now," says Amanda Fox, a vice-president at Chicago corporate recruiters Paul Ray Carre Orban International.

That frustration is understandable. In the early '70s, 99% of senior management was male. Now, after 20 years of "progress," 97% of senior management is still male. Five years ago, two women chief executive officers ran BUSINESS WEEK 1,000 companies. Today, only one does. Despite years of rosy predictions that women would quickly ascend the corporate ladder, their presence in the executive suite hasn't changed significantly in a generation. And female executive salaries are still below those of their male counterparts.

CRITICAL MASS. But women are starting to achieve equal representation in the lower and middle ranks. Fully half the entry level management corps is female (up from 15% fifteen years ago), and soon the midlevel echelons will be, too. Such unprecedented numbers by necessity will break down barriers. If they don't, "the amount of active discrimination would be so obvious as to be outrageous," says Anne Ronce, a San Francisco-based management consultant. The numbers suggest that the 1990s may be the breakout decade for women. But after the glacial progress of the past 20 years, many believe the pace of change will still be measured in smaller steps and individual victories.

In the past, women haven't reached the top because there's been no real need to put them there. Despite all the proclamations about the increasing diversity of the work force, corporate officers have still had plenty of male candidates to fill the upper ranks: "They've heard about the demographic change, but haven't seen it or experienced it," says Mary C. Mattis, vice-president for research at Catalyst Inc., a New York research firm that focuses on women in business. If a superb female candidate was under everyone's nose, fine. But the idea of promoting women has really been more of a social issue than an economic necessity.

That will soon change. While women have been packing into the corporate pyramid base for years, it's only now that their presence is reaching critical mass. Even more important, a growing number of women are in so-called line jobs--those integral to company profit centers--rather than staff positions. If the first generation of senior management women made it with such titles as "executive vice-president for human resources" or "managing director of public relations," this second generation seems to have a predominant number of chief financial officers and general counsels.

The number of qualified women rising in the pyramid will soon be so great that ignoring them will not only be discrimination but bad business, some analysts argue. "Companies will want to mobilize the best talent," says Felice N. Schwartz, president of Catalyst. "So there will be intense competition to recruit, develop, and retain these women."

It may be happening already. Since 1986, the percentage of officer-level searches at Paul Ray that include women candidates has increased from 11% to 40%. Other corporate headhunters have noted a steady increase in female hires. In 1981, 5.5% of Korn/Ferry International's senior management placements were female. In 1991, the figure had jumped to 16%. In the mid-'80s, 2% of execs placed by Cleveland-based recruiters Lamalie Associates, were female. Last year, 10% were.

Coming off a minuscule base, these numbers do show progress. But in absolute terms, the figures still seem small. The problem is not that women haven't advanced in the corporate ranks but that they haven't advanced in proportion to their presence in the work force. Because women represented 15% of all managers in 1968, you might expect 15% of today's senior managers to be female, notes Ann M. Morrison, co-author of the 1987 book Breaking The Glass Ceiling. Instead, they make up about 3%, even though the percentage of women managers overall has grown to almost 41%, according to the Bureau of Labor Statistics. As for the number of women actually heading public companies, "you can count them on one hand--with fingers missing," says Golden West's Marion Sandler.

NOT IN MY COMPANY. Why aren't more women running things? The reason is something beyond natural attrition. That's the thesis of All the Right Stuff, a new study by a trio of professors from Loyola and Northwestern Universities. The survey analyzed the career progress of 1,000 male and female midlevel managers at 20 corporations. All were comparably educated, career-oriented, and performing similar functions. But the researchers found that over five years, the women's salary raises lagged 11% behind the men's, and that the women had received fewer job transfers. "The women had done all the same things, and yet their progress was less, and they earned less," says co-author Linda K. Stroh, assistant professor of organizational behavior at Loyola. "The women were not only disadvantaged, but discriminated against."

Discrimination is something that most male--and many female--execs would deny happens in their companies. Yet, as the Labor Dept. made clear in its 1991 study of nine companies, Report on the Glass Ceiling Initiative, gender-related bias still exists. Judy B. Rosener, a professor at the University of California at Irvine's School of Management, calls it "sexual static"--a subtle, even subconscious discomfort at seeing women assume certain roles or behave in certain ways.

Last August, along with the report, the Labor Dept. announced its determination to eradicate workplace prejudices. The news has stirred the business community: 50,000 copies of the report have been distributed, and the Office of Federal Contract Compliance Programs logged some 2,500 hours in three months advising government contractors.

Some women haven't waited for their companies to comply. In 1985, Barbara Sogg filed a discrimination suit against American Airlines Inc., charging she was passed over for a plum job--general manager of operations at New York City's LaGuardia Airport--because of her age, sex, and health. A younger, less-experienced man got it. In January, she was awarded $7 million, which a state judge recently cut to $3.8 million. American is appealing.

GETTING MAD. But while the case dragged on, American's CEO, Robert L. Crandall, began several innovative training and management programs to identify and encourage talented women. American's Supertrack program, launched in 1988, opens evaluations of promising managers to all of the company's senior officers. Supertrack and other programs were not in any way related to the Sogg lawsuit, American insists. But as a result of these efforts, the percentage of women in mid- and upper-level management at American rose from 12% in 1986 to 21% in 1991.

Some women say relying on management-sponsored efforts isn't enough. Organizations such as the Fund for the Feminist Majority think businesswomen need to get mad. "These guys aren't going to open the doors willingly," declares Katherine Spillar, the group's national coordinator. "By playing it safe, you're gaining nothing." Figuring that "at the current rates of increase it will be 475 years before women reach equality in executive suites," the fund's literature urges corporate women to form in-house caucuses, complain loudly and publicly about inequities, and generally concentrate on challenging the old-boy-network rules.

In the late '60s and '70s, organized, adversarial tactics got women into companies and paved the way for their promotions. And they can still be effective: Don't even think of getting a piece of California's $67 billion public employees' retirement fund, State Treasurer Kathleen Brown tells investment managers, unless your team includes a woman. But others fear that pro-woman policies just create affirmative-action appointments. "The worst thing for women in business is a token position. It undermines them," says Lois D. Juliber, chief technological officer for Colgate-Palmolive Co.

Many of her colleagues would agree, especially those who have won top jobs during what Faludi calls "the last 10 years of silence." Unlike their predecessors in the '60s and '70s, who self-consciously--and justifiably--saw themselves as pioneers and role models, this generation of executive women puts the emphasis on "executive" rather than on "woman." Some senior execs are loath even to acknowledge their companies as particularly woman-friendly--"meritocracy" is the word they prefer. "Sara Lee is relatively neutral, and that's the only thing I can hope for," says Mary Ellen Johnson, who became the company's treasurer and top-ranked female in 1986.

`COLLECTIVE VOICES.' Nevertheless, there are signs of "corporate women finding the strength of their collective voices," as National Organization for Women President Patricia Ireland puts it. In the past year, employees at a variety of companies have formed in-house groups. Sponsoring lunches and panel discussions, these organizations are hardly militant. Yet, "merely having a public network is in a sense doing something activist," says Vicki Kramer, a Philadelphia career consultant.

Since these women see themselves as management, however, a strong sense of pragmatism permeates their activism. "Women's issues must always be seen as furthering the goals of the corporation," says Elizabeth Pugh, a vice-president at First Boston Corp.

Few women managers expect their progress to be anything other than gradual. In a 1990 Korn/Ferry and University of Los Angeles survey of 4,000 senior executives, a majority estimated that women would occupy 16% of upper-management posts at the turn of the century. That's quite a jump from today's 3%--though still rather low, considering that by then half the work force will be female.

For further advances to occur, "Corporate America must get over its fears" of women in authority, says John P. Mascotte, CEO of Continental Insurance Co., which actively prepares its female personnel. More women in the ranks will help. Management attacks on bias will help. Female execs uniting behind common causes will help. If this combination of demographics and enlightenment--along with a little legal pressure--can coalesce, the '90s might become a breakout decade after all.

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