David Ross

Female executives may be facing an “implicit quota,” says management professor

Companies frequently congratulate themselves when they hire a female executive for a top management role.

That applause, however, turns to silence when another woman attempts to break the glass ceiling at that same company.

According to a new study by UF management professor David Ross, female executives may be battling an “implicit quota” where, for many of the world’s top companies, one woman in a major leadership role is enough.

Ross, University of Maryland professor Cristian Dezsö and University of Michigan professor Jose Uribe, found that “the probability that a woman occupies a top management team position is 51 percent lower if another woman holds a position on the same team.”

The findings are discouraging as the debate about gender equality in the workplace is at a high point. According to the study, which cited the Bureau of Labor Statistics, women make up 47 percent of the labor force and 38 percent of all managerial positions. However, women hold only 3.7 percent of chief executive officer positions and 6.1 percent of line officer positions on top management teams in 2011.

The researchers analyzed data from Standard & Poor’s ExecuComp index and CompuStat database, and the Center for Research in Securities Prices, and examined the top-five, highest-paid executives at S&P’s 1,500 companies over a 20-year stretch (1991 to 2011).

Their approach was to use the data to predict as precisely as possible based on observable data about firms, their top management positions, and other determinants of women’s participation in management the probability that each top management position in these firms was occupied by a woman at a given point in time. They used the probabilities to simulate what women’s participation in top management would look like assuming that a woman’s presence on a top management team was independent of whether a woman was present elsewhere on the same team. They then compared these simulations with the actual distribution of women across companies.

What they ultimately found was that the women were “overdispersed” across companies, almost as if women had been carefully allotted in small numbers (usually only one) to top management teams rather than the clustering in particular firms that one would observe if women in top management were exerting their influence to pave the way for future female colleagues at their firms.

The study was unable to provide unequivocal evidence for an underlying mechanism for their findings, but the researchers suggest that the results are consistent with an implicit quota on women in top management, whereby, once a firm has hired one female top manager, the firm either stops making efforts to hire more or perhaps actively resists doing so.

Two important takeaways from their study are that women in top management may not be able to pave the way for other women at their firms and that companies that are serious about increasing female representation in the C suite should not relent once some initial progress is achieved.

The study, “Is there an implicit quota on women in top management? A large-sample statistical analysis,” will appear later in the Strategic Management Journal and is already available online.