Women need to show more visible qualifications than men to succeed in leadership positions, according to research from the University of Mannheim Business School (UMBS). The study analysed the biographical information of 103,461 directors and found that women with signals of higher education and professional experience were 12.9% more likely to reach a leadership position and received 21.2% more pay than their male counterparts. In contrast, signals of higher education and professional experience increased a male director’s probability of entering a leadership role by 5.9%, and their pay by 6.8%. The findings suggest that women are held to higher standards than men when it comes to filling a leadership position.
The research was carried out by Prof. Alexandra Niessen-Ruenzi, Chair of Corporate Governance, and PhD candidate Leah Zimmer, both of UMBS. They investigated two categories of skill signals: signals of higher education (e.g., degree levels and whether they graduated from a Top 50 US college) and signals of professional experience (e.g., general management skills from past work). The findings are in line with models of screening discrimination, where women need to provide more observable skill signals as employers find it more difficult to judge their unobservable qualifications for a leadership position, such as emotional intelligence, communication skills, creativity, critical thinking, and adaptability.
The study also found that observable skill signals are more important for female directors if the hiring decision is made only by men and after sudden CEO death when search committees need to find a new CEO under time pressure. The results are also stronger for female directors entering a leadership position from outside the company and for firms headquartered in states with conservative gender norms.
The research takes into account the different baseline probabilities for men and women to reach leadership positions. Women are less likely to reach leadership positions or receive higher pay compared to men to start with. As long as there are different baseline probabilities for men and women, equally qualified women are expected to collect more observable skill signals than men to improve, but not eliminate, gender gaps in leadership and pay.
The findings were published as a European Corporate Governance Institute Finance Working Paper. The research suggests that gender bias is still prevalent in the workplace, and women need to work harder than men to achieve the same level of success. The study provides valuable insights into the challenges faced by women in leadership positions and highlights the need for organisations to address gender inequality in the workplace.
The study found that women need to demonstrate visible qualifications, such as higher education and professional experience, to overcome the barriers to leadership positions. Women also need to provide observable skill signals to overcome gender stereotypes and discrimination. The findings highlight the need for organisations to recognise the value of diversity and create a level playing field for women to succeed.
The research also highlights the need for organisations to address the unconscious biases that may exist in the recruitment process. Employers need to be aware of the unconscious biases that may affect their hiring decisions and take steps to address them. This includes training hiring managers to recognise and overcome their biases and implementing objective recruitment processes that are fair and transparent.
The study provides valuable insights into the challenges faced by women in the workplace and highlights the need for organisations to address gender inequality. Employers need to recognise the value of diversity and create an environment where women can succeed. This includes providing opportunities for women to gain visible qualifications, recognising the value of unobservable skills such as emotional intelligence, communication skills, creativity, critical thinking, and adaptability, and addressing unconscious biases in the recruitment process.
The research from UMBS highlights the need for organisations to address gender inequality in the workplace. The study found that women need to demonstrate visible qualifications to overcome the barriers to leadership positions, and that observable skill signals are more important for women than men. The findings highlight the need for organisations to recognise