The world has made very little progress in ensuring that more women reach the top of companies. Only 3% of last year’s incoming CEOs were women according to a recent study from Strategy& (formerly Booz & Co.) The consultancy predicts that that number will increase dramatically in the future, and that approximately one-third of new CEO appointments will be women by 2040.
That would be a very significant jump, but it also means that anything approaching gender parity at the top of companies is very far away. This year, the share of incoming female CEOs was only 0.5% larger than the share of outgoing ones. If that trend holds the number of women CEOs will grow, but slowly.
The study looked at arrivals and departures at the world’s largest 2,500 public companies over a decade.
That slow progress might be exacerbated by a couple of notable differences between men and women CEOs. According to the study, women CEOs are significantly more likely to get fired than men. 38% of departures by women chief executives were forced. 27% of men were forced out.
Additionally, women were more likely to be hired from outside the company. 35% of women were external hires, compared to 22% of men. Multiple studies have found that external hires are less successful than internal promotions.
We don’t know exactly why either of these differences exist. Leonid Bershidsky rounds up academic evidence at Bloomberg View that supports one theory: many female CEOs are appointed in times of crisis or when a company needs a breakthrough. If they don’t succeed, companies may be more likely go with a safe choice, often a white male, he writes. Rising numbers of women CEOs overall could potentially reduce some of these differences over time.