New Research from the Jones School of Business Offers Solutions to Increase Female Corporate Leadership
A new study from the Jones Graduate School of Business at Rice University may help companies address problems of gender inequality within business leadership. Working together with the Central University of finance and Economics in Beijing, China, experts at Rice University studied the effects of gender change within CEO succession.
The study utilized data from 3,320 CEO successions within publicly traded companies in China from 1997 to 2010. The data examined the results of a gender change in CEO on the company’s’ success, and found that companies with a male-to-female succession have less post succession success and often lead to the successor’s early departure.
The study’s lead author was Yan “Anthea” Zhang, professor of Strategic Management at Jones Graduate School of Business. According to Zhang, the high proportion of female CEO’s in China provided a broad range of data for studying gender change in CEO succession- in 2010, 5.6% of CEOs for publicly traded companies were women, higher than the proportion in the United States. However, Zhang states that “…while the empirical context is Chinese, the issue should be of interest to companies in the U.S.”
Zhang states that the study’s results likely explain inequality in corporate leadership. If disruption commonly happens with a gender change in CEO succession, companies will be more likely to stick to the status quo. Since the majority of CEOs are male, this will leave less opportunity for women seeking leadership roles.
According to Zhang, the discoveries in this study can encourage organizational solutions to ease the transition of a male-to-female CEO succession, allowing more opportunities for women. The disruptive effect of a gender change was lowered in cases where the succession was internal, rather than external, and when there were female leaders on the firm’s board of directors. Zhang believes that a focus on factors like these can help ease the transition in a male-to-female succession and help to female corporate leadership to grow.