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Women don’t need big government’s help to climb the corporate ladder

Jerry Brown may think he’s giving women a helping hand. But women are not children

October 10, 2018

11:17 AM

10 October 2018

11:17 AM

Publicly-traded companies in California are now required to have a woman on their board of directors thanks to Gov. Jerry Brown, who signed a bill enacting the new mandate on in September. Although they intended to diversify corporate boardrooms, California legislators actually revealed that they believe adult women should be treated like helpless children. Ostensibly ‘feminist’ policies that give women an advantage based solely upon their gender will in fact undermine women’s equality.

Women do not need hand-holding from the government to get ahead in their careers, and such legislation is counterproductive and patronising.

California’s legislation supposedly would benefit businesses; greater gender diversity would lead to better decision-making in the boardroom, as the story goes. California State Senator Hannah-Beth Jackson said of the legislation, ‘We are going to require this because it’s going to benefit the economy. It’s going to benefit each of these companies.’ Research from some consulting firms does suggest that diversity improves business performance. But as Katherine Klein, a Wharton professor, noted in her review of the relevant literature, ‘research conducted by consulting firms and financial institutions is not as rigorous as peer-reviewed academic research…. Rigorous, peer-reviewed studies suggest that companies do not perform better when they have women on the board.’ Klein noted that mixed-gender boards do not perform worse than all-male boards, but that the relationship between gender diversity and corporate excellence was weak or non-existent.

But even if gender diversity was shown to improve business performance, why would it be the state legislature’s right to mandate such a requirement? Why not let businesses move toward gender diversity of their own volition? Corporations constantly seek out ways to earn more profit. If gender diversity did boost performance, the free market would clearly reveal this. Corporations would make changes on their own, no legislation required.

Still, right now 25 per cent of publicly-traded companies in California do not have a single woman on their executive board. Yet California legislators are operating under the assumption that women deserve these high-level corporate jobs, and are not receiving them due to gender discrimination. But it’s entirely possible that women are not getting these jobs because they are not asking for them.

In the United States, women are less likely than men to negotiate their salaries, according to a 2016 Glassdoor survey. American men are also four times as likely as women to ask for a raise. Though headline-generating research this summer declared that men and women are equally likely to ask for raises, a look into the methodology reveals that the survey was conducted in Australia, not the United States. Statistics professors will often remind students that statistical research cannot be easily translated from one population to another. A study of Australian women may have nothing to say about American women. The authors of the study also agree that their research contradicts previous work, and therefore further research is needed.

But not only are women less likely to negotiate their salaries and ask for raises, they also are less likely to ask for promotions. Victoria Medvec, a professor at the Kellogg School of Management, notes that women are less likely to ask for promotions because ‘women and men approach promotions differently.’ Women are more likely to wait to be recognised for their accomplishments rather than ask for recognition, and they hesitate to put themselves forward for a promotion if they do not think they possess all the necessary qualifications. Therefore, the body of available research suggests that women may not be getting corporate board positions in part because they are not as aggressive as men in asking for what they want in the workplace.

There are also fewer women in business to begin with, so it makes sense that fewer women would get jobs at the top of corporations. According to the Association to Advance Collegiate Schools of Business, women make up only 36 per cent of business school enrollees. This gender imbalance in MBA degrees translates to fewer women in business — women make up 44 per cent of the management, business, and financial operations sector, per the Bureau of Labor Statistics. And within that sector, women dominate occupations such as human resources, education, social services, event planning, marketing, and fundraising — often not executive-track jobs.

Women choose different occupations because women, on average, have different preferences about their work lives than men. Women choose jobs where they can work with people, and they prefer to work fewer hours. Women with at least one child under 18 consistently prefer part-time work to full-time work, and employed women work 49 minutes less each day than men, on average. When only looking at full-time workers, women still work a half hour less each day than men.

Those women who have made it to the top of their profession and earned their corporate board appointments by getting an advanced degree and working long hours may actually be punished by California’s new legislation. Because women will no longer receive promotions based solely on merit, every new female board appointment will be suspect. Every new female board appointment will feel as if she does not quite belong. She will be the ‘token’ board member, the ‘affirmative action hire.’ A merit-based system erases these rumours and helps women earn respect from their peers.

Gov. Jerry Brown may think he’s giving women a helping hand. But women are not children — and they don’t need Daddy Government to sort out their career paths.

Amelia Irvine is a contributor for Young Voices and studies economics at Georgetown University.

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