Any successful woman who’s been in the workforce for more than a decade has either experienced or is acutely aware of the glass ceiling. It’s that invisible, but tangible barrier women have faced when striving to ascend to the upper echelons of leadership within a company. More women than ever before are crashing through the glass ceiling! But, did you know that many of them end up on a glass cliff?
What is a glass cliff?
It wasn’t enough that women had to fight for decades to claim their rightful places in the workplace. It’s now been shown that many of the executive positions women receive have higher risk and are with companies in crisis. What?!
According to a 2004 study by Michelle Ryan and Alex Haslam, British gender researchers at the University of Exeter, oftentimes women are offered ‘glass ceiling shattering’ positions when there’s a significantly greater chance of failure – when a company is in dire circumstances or has poor performance, they hire a woman to turn things around. Ryan and Haslam termed this the ‘glass cliff.’
Ryan and Haslam decided to conduct their study after a UK newspaper, The Times, blamed several female chief executives for “wreaking havoc” on their companies. The Times went on to write that businesses would be better off without women executives. The researchers were also influenced by women in politics such as Margaret Thatcher, former British Prime Minister, who was elected when Britain faced excessive unemployment and a recession.
The study looked at the 19 UK FTSE 100 companies with women leaders in 2003 and found that a woman was more likely to be hired into the senior role when the company had been underperforming for at least five months prior, while men were hired into companies with stable performance.
The glass cliff is pervasive
The researchers found the glass cliff is not isolated to women in the UK. A 2004, Women’s eNews article cites, “Australia’s only two female state premiers [at the time], Joan Kirner and Carmen Lawrence, [as] two high-profile examples of women who wound up on the glass cliff. Both were appointed in times of exposed scandal and lost their subsequent elections.”
In another Women’s eNews article published this week, When Wall Street Needs Scapegoats, Women Beware, Caryl Rivers cites several recent examples of executive women on the glass cliff:
“Meg Whitman, named CEO of Hewlett-Packard in 2011, was No. 3 on Fortune’s list of the 50 most powerful women in 2012. However, Fortune warned, “Whitman was supposed to be HP’s savior, but the hoped-for turnaround has yet to materialize.””
Carly Fiorina, Whitman’s predecessor, “Kate Swann of British retailer WH Smith and Patricia Russo of Alcatel-Lucent were all appointed to top positions at a time of tumbling share prices.”
Zoe Cruz, then co-President, took the fall for Morgan Stanley in 2007. “She was obviously a scapegoat; in fact, she had suggested that the company pull out of risky subprime mortgages.”
Ina Drew, former chief investment officer at JP Morgan, took the hit over male CEO, Jamie Dillon, in 2012 when the company posted a $10 billion loss. She was replaced by two men.
Yahoo! “recruited Carol Bartz as its CEO in 2008 during another rocky period and then pushed her off the cliff in 2011 when results didn’t improve.” It’s too early to tell whether Marissa Mayer, current Yahoo! CEO, will follow Bartz over the cliff or be one of the female CEOs to successfully navigate off of it.
Why does the glass cliff exist?
In their article this week, Women’s eNews cites speculation from Kristin J. Anderson, an associate professor of psychology at the University of Houston-Downtown, that possible reasons women end up on the glass cliff include a view of women as scapegoats and expendable. And, more cynically that the organizations hiring women into high risk roles view it as a “win-win” – if the female executive fails, she’ll be blamed and they can hire a man to replace her; if she succeeds then “the organization can present itself as egalitarian and progressive.”
Anderson also notes that when male leaders fail, it’s never attributed to gender, but the failure of a female leader may be attributed to gender when there’s the belief that women don’t belong in positions of authority. While we don’t want to believe blatant gender discrimination still exists, Anderson has some valid points.
Susanne Bruckmüller and Nyla R. Branscombe addressed the gender disparity in a 2011 article for Harvard Business Review, How Women End Up on the “Glass Cliff.” The article summarized two experiments conducted by Bruckmüller and Branscombe. Their findings suggest gender role perceptions and stereotypes create the glass cliff phenomenon for women; “we found that when a company is doing well, people prefer leaders with stereotypically male strengths, but when a company is in crisis, they think stereotypically female skills are needed to turn things around.”
No Glass Ceilings
There are many out there who believe that women executives underperform their male counterparts. Case in point, a post in 2012 by Jim Fink, Sexist Shareholders and the Underperformance of Women CEOs, on Investing Daily. In the post Fink writes that Marissa Mayer’s “quixotic attempt to “have it all” cannot possibly work.” And, he goes on to explain underperformance of women in CEO roles as, “many of whom have not been able to exert maximum effort because of child-rearing responsibilities.” Are you kidding me?
While some of the companies headed by the women CEOs in Fink’s post may have underperformed, I’ll bet most of the men to which these women are compared were not brought in to turn their companies around. The good news – no, the great news is that Motif Investing, a new and innovative online broker, has squashed the misleading belief that women underperform.
Motif Investing offers creative portfolios or indexes they call “motifs” in which people can invest. Last year, they introduced the ‘No Glass Ceilings‘ motif which is made up of companies who have had a female CEO for more than a year. According to Motif Investing’s most recently published data, No Glass Ceilings is outperforming the S&P 500, with an annual return of 32.3%. Take that Mr. Fink!
While I didn’t recognize it at the time as being on a glass cliff, I’ve gone through the experience. I was hired to lead a function that had been through significant downsizing, high voluntary turnover, and a number of male predecessors. The function had basically been ignored and was not valued within the company. It’s interesting to look back now and see how similar my experience was to the female CEOs who were, and are, on the glass cliff. Have you been there or had a similar experience? Share your story with us. You can find Ask Ajna on Youtube, Facebook and Twitter. #LeaveYourLegacy
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