Tomorrow’s CEOs Will Be Increasingly Female, and Will Have Different Skills Than Today’s CEOs
Today, there are just 20 women CEOs in the entire Fortune 500, but a recent study projects that number will change dramatically over the next 20 years.
July 10 2014 by Dale Buss
Although women’s overall share of this year’s incoming class of CEOs is small, the “2013 Chief Executive Study” by Strategy& shows that more women are rising through the ranks to the CEO position than did five years ago (3.6 percent vs. 2.1 percent, respectively).
With 60% of all college students and 40% of all MBA students currently being women, by 2040, Strategy& says that women will represent one-third of the incoming class of the top 2,500 companies. The woman CEO of the future will also achieve the top position earlier than women do today, and will have a more diverse background, with communication skills increasing in importance.
The report also found two anomalies: 1) That women are more likely than men to be hired from the outside rather than groomed from within, and 2) They are more likely to be fired than their male counterparts. These findings suggest that boards tend to take a higher risk on women, but those risks come with as many failures as successes.
THE PATH TO THE CEO CORNER
HP’s former CEO Carly Fiorina, Kraft’s Irene Rosenfeld, Campbell’s President and CEO Denise Morrison and Maggie Wilderotter, CEO of Frontier Communications (who is Denise’s sister), were all hired away from other companies. Xerox’s former CEO Anne Mulcahy, GM’s current CEO Mary Barra and IBM’s Chairperson and CEO Virginia Rometty were all hired from within.
What educational paths are these women taking to get to the corner office compared to men? The top 10 Fortune 500 male CEOs attended state schools for undergrad. Not so for the women. HP’s current CEO Meg Whitman went to Princeton; Rometty, Northwestern and Rosenfeld, Cornell. Fiorina attended both Stanford and MIT.
Of the top 20 female CEOs of Fortune 500s (based on revenue) today, nearly half (45%) do not have graduate degrees, while just 5% of the top 20 male CEOs don’t.
In addition to seeing many more women CEOs a quarter century from now, Strategy& says that they will be greater connectors and greater communicators than they are today.
To find the best CEO talent in the future, Strategy& suggests companies offer the broadest and deepest experience to a promising array of young people. “Focus on the deepening bench strength and special skills that future leadership of your company requires,” says Per-Ola Karlsson, Senior Partner of Strategy&. And, he says, seek out and cultivate women employees.