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The Path to Gender Parity

Women CEOs remain rare. How are companies addressing lack of women in leadership?

Authors: Jennifer Laidlaw, Wera Von der Osten, Erin Tully, Philipp Cyrus, Jonathan James Santos

Published: March 8, 2023


Women hold only a small fraction of total CEO roles across regions and sectors, according to S&P Global data.

The number of women in management has ticked up only slowly since the COVID-19 pandemic, which could restrain the pool of future women CEO candidates.

S&P Global data shows that few companies offer employee support programs such as childcare facilities or paid parental leave beyond legal minimums — factors that could impact women’s career development.

International Women’s Day on March 8 is an occasion to put a spotlight on the role of women in the workplace, particularly at a time when companies face growing pressure from investors and other stakeholders to increase the diversity of their workforces, boards and management teams.

Out of more than 5,400 companies assessed in the S&P Global Corporate Sustainability Assessment, or CSA, only 4.4% had a woman CEO, according to a new analysis. The utilities sector has the highest percentage of women CEOs in that universe, at 10.6%. Efforts by the sector to diversify its talent pipeline as well as changes in utilities’ business models and technological transformations requiring different skill sets could help explain the higher number of female CEOs. Health care, traditionally a bastion of female employment, comes next at 7.9%, while the energy, industrials and information technology sectors have the lowest percentage of women CEOs, all below 3%. Most other sectors hover around 4% or 5%.

In some parts of the world, policymakers have taken steps to promote gender diversity by passing laws to increase the representation of women on corporate boards. For example, several European countries including France, Germany, Spain and Belgium have passed laws to elevate women to top corporate positions. The EU recently adopted a law on gender balance on corporate boards that says at least 40% of non-executive director positions, or 33% of all director posts, must be occupied by the “under-represented sex” by 2026.

In some instances, gender quotas have yielded positive results for corporate board representation. For example, France passed a law in 2011 making it compulsory for companies to fill at least 40% of corporate board seats with women. The percentage of women on the boards of France’s biggest publicly traded companies soared to 46% in 2021 from around 15% in the year the law was passed. Despite these efforts, there is still a long way to go to achieve gender parity in the corporate world, particularly when it comes to top jobs such as CEO.


Europe has the highest percentage of women CEOs

Europe is the region with the highest percentage of women in CEO roles, at 7.9%, reflecting legislative measures to ensure women’s participation in company decision-making. European countries that are not part of the EU have also made strides in gender balance. Norway was the first country in the world to introduce binding gender quotas for corporate boards, while the U.K.’s voluntary approach to gender balance has produced encouraging results.

In North America, women hold 7% of CEO roles. In Asia, just 3% of CEOs are women, and in Latin America that figure is just 1.5%. A lack of legal frameworks ensuring equality in Asia could help explain why the region has so few women CEOs. In Latin America, progress on gender equality has been slow in conservative cultures, where the argument is often made that there is a lack of qualified female candidates and beliefs persist that women are needed at home.


The percentage of women managers has barely risen since COVID-19

Many conversations about women in leadership roles focus on the talent pipeline, and how companies are developing talent earlier in careers that could eventually lead to senior management roles and the C-suite. Viewed through that lens, the outlook for increasing the number of women in the CEO role appears troubling. S&P Global data shows that there has been scant improvement in recent years in the number of women in management positions. The data shows that the percentage of women in management ticked up to 30% in 2022 from 28% in 2019. In this analysis, “women in management” is defined as junior, middle and senior level management.

The number of women in management declined in the energy sector over the same period, despite rising between 2020 and 2021. Women in management in consumer staples and real estate fell in 2020, the year the COVID-19 pandemic started, but rose in 2021 and 2022. In most sectors, the number of women in management rose slightly or remained stable between 2019 and 2022. The exception was the health care sector, where the percentage of women in management rose to 46% from 40%, and the historically male-dominated information technology sector, where the percentage rose to 26% from 22%.

The gender disparity is less stark for overall employment across all positions, but also shows stalled progress in achieving gender parity. Women have made up 36% of the total workforce for the last three years. There were declines in the percentage of women in the workforce in the energy, financials and real estate sectors between 2019 and 2022. Most other sectors such as utilities and consumer discretionary companies showed moderate improvements, and health care saw a rise to 53% in 2022 from 50% in 2019.

There are also regional disparities. Latin America companies saw the share of women in management roles edge up to 29.7% in 2022 from 28.6% in 2019. Asia-Pacific companies saw their share of women in management rise to 25% from 23.4% during that same time period. The figure rose more significantly in North America, Europe and Africa over this three-year period.


The ongoing impact of COVID-19

Women’s careers were generally hit harder by COVID-19, as many lost their jobs during lockdowns or left the workforce to take over home-schooling and childcare duties. Women represented 39% of the global workforce but accounted for 54% of pandemic-related job losses as of May 2020, according to consultancy McKinsey. Women were overrepresented in sectors most heavily hit by the pandemic, such as hospitality or the food services industries, further exacerbating inequalities.

According to an S&P Global/AARP survey of nearly 1,600 people conducted in the late summer of 2020, many parents and family caregivers in the U.S. saw their at-home commitments grow from the beginning of the pandemic, leading to increased stress and some feeling that they were being penalized at work for their increasing responsibilities. With many schools and daycares closed and with many children moving to virtual schooling, the amount of time required for childcare duties since the pandemic began increased for 58% of parents, according to the survey results.

In its Women, Business and the Law 2022 report, the World Bank underscores that the pandemic heightened the importance of ensuring that childcare policies are aligned to parents’ needs, especially those of working mothers. The report, published annually, measures global progress toward gender equality in 190 economies. It says childcare needs to be available, affordable and good quality.

Legislation strengthening women’s rights is essential to make the world more equal and inclusive, the report says, noting that differences between men and women’s average lifetime earnings are estimated at $172.3 trillion — equivalent to twice the world’s gross domestic product. On average, women have about three-quarters of the legal rights afforded to men, according to the World Bank study, which measured women's legal rights with regards to mobility, the workplace, pay, marriage, parenthood, entrepreneurship, assets and pensions.


The role of support programs in career development

The CSA collects data on the employee support programs companies offer, which can play an essential role in keeping women in the workforce as they juggle care responsibilities. These support programs include childcare facilities or contributions; breast-feeding or lactation facilities or benefits; paid parental leave in excess of legal minimums; and part-time working options. Our analysis found that these support schemes were not widely offered across industries. Paid family or care leave beyond parental leave — defined as additional time off to look after a dependent family member — was especially rare.

The lack of such offerings could have knock-on effects for the talent pipeline and employee turnover. Women who don't have the support needed to continue in their careers while managing their family and childcare responsibilities will have to make tough choices, and some will leave the workforce.  

On the high end of the spectrum, 24.2% of companies in the financials sector offer childcare facilities or contributions. Women made up the majority of the sector’s  workforce at 52% in 2022  and 5% of its CEOs are women, just slightly higher than the average of 4.42% for all sectors.

On the opposite end of the spectrum, only 8.6% of energy companies have childcare facilities or contributions . At 19.1% of utilities companies there are breast-feeding or lactation facilities or benefits, but that figure is just 5.4% among industrials and real estate companies.

When it comes to paid leave, 20% of companies in the financials sector go beyond minimum legal requirements in the paid parental leave they offer for the primary caregiver on the arrival of a new child. That figure drops to just 16% for the non-primary caregiver. Only 11% offer paid family leave.

Offering paternity leave could help break down gender barriers and ease the mental load women employees often carry. Research shows that providing support globally to families by encouraging paternity leave could also improve gender equality in society — and thus in the workplace. A study by the German Institute for Economic Research suggests that the introduction of policy measures such as paternal leave can change attitudes toward traditional gender roles.


The benefits of diverse leadership — and the long road ahead

Research has also shown that a more diverse workforce can make a company more profitable. It could also have an impact on the long-term value of a firm. A study by S&P Global published in 2019 showed that firms with female CFOs were more profitable and generated excess profits of $1.8 trillion. Companies with female CEOs and CFOs produced superior stock price performance compared to the market average, while firms with more women on their boards were more profitable than firms with low gender diversity.

Given the low percentage of women CEOs across sectors and geographies, it will take many years to achieve parity. According to a report by the United Nations, the world is not on track to meet a U.N. goal of reaching gender equality by 2030. Alarmingly, it would take another 286 years to achieve gender equality across society, the report estimated. The U.N. launched its 17 Sustainable Development Goals, known as the SDGs, in 2015 with an aim to create a safer, more prosperous planet by creating gender equality, eradicating poverty, eliminating hunger, providing clean water and urgently addressing climate change by 2030.

S&P Global data shows that only a small percentage of companies offer employee support programs that would be particularly beneficial to working women. By implementing strategies to increase those numbers, companies could improve the conditions for women and thus increase their number in the workplace, creating a talent pipeline for future senior leaders. Companies may find that putting diversity at the forefront of their decision-making could pay off in the longer term.