Good for Business

on Wednesday, 23 May 2012. Posted in Articles on Leadership / Gender

Good for Business
The Glass Ceiling Commission, USA Department of Labor
Good for Business: Making Full Use of the Nation's Human Capital

What is the Glass Ceiling?

Federal Glass Ceiling Commission research papers, as well as testimony presented at the public hearings, clearly document that today’s American labor force is gender and race segregated—white men fill most top management positions in corporations.

According to surveys of Fortune 1500 companies conducted by Korn/Ferry International and Catalyst over the last decade, 95 to 97 percent of senior managers—vice presidents and above— were men. A 1989 Korn/Ferry survey found that 97 percent of male top executives are white. A 1992 survey of Fortune 1500 companies found that 95 percent of the three to five percent of the top managers who were women were white non-Hispanic women. In 1994, two women were CEOs of Fortune 1000 companies.

The representation of women and minorities on Fortune 1500 boards of directors is also limited. Cox and Smolinski point out that less than 10 percent of the largest employers have women on their board of directors. According to a 1992 Heidrick & Struggles survey, Minorities and Women on Corporate Boards, non-U.S. citizens held 2.85 percent of the board seats of 806 Fortune companies, slightly less than the 3.11 percent combined total held by all racial and ethnic minorities. Conversely, the American workforce is increasingly diverse. In 1950, white men comprised 65 percent of the labor force; in 1990 white male representation had dropped to 43 percent.

During the same period, representation of white women in the labor force increased from 24.2 per-cent to 35.3 percent. At the same time, minority representation in the labor force doubled, to 15.2 percent. Over the last decade, the size of the Asian and Pacific Islander American population has doubled, becoming the fastest growing of minority groups in the United States.

A larger proportion of women and minorities are locked into low wage, low prestige, and dead-end jobs, which according to Harlan and Bertheide, are not connected to any career ladder. 

GLASS CEILING BARRIERS

Glass Ceiling research reveals three levels of artificial barriers to the advancement of minorities and women in the private sector that contradict this nation’s ethic of individual worth and accountability, the belief that education, training, dedication, and hard work will lead to a better life.

The three levels of barriers identified by the Commission research, CEO studies, and focus groups are these: 

• Societal Barriers which may be outside the direct control of business minorities and women from the top levels of management. 

—The Supply Barrier related to educational opportunity and attainment

—The Difference Barrier as manifested in conscious and unconscious stereotyping, prejudice, and bias related to gender, race, and ethnicity.

• Internal Structural Barriers within the direct control of business

—Outreach and recruitment practices that do not seek out or reach or recruit minorities and women

—Corporate climates that alienate and isolate minorities and women

—Pipeline Barriers that directly affect opportunity for advancement

—Initial placement and clustering in staff jobs or in highly technical and professional jobs that are not on the career track to the top

—Lack of mentoring

—Lack of management training

—Lack of opportunities for career development, tailored training, and rotational job assignments that are on the revenue-producing side of the business

—Little or no access to critical develop mental assignments such as memberships on highly visible task forces and committees

—Special or different standards for performance evaluation

—Biased rating and testing systems 

—Little or no access to informal networks of communication

—Counterproductive behaviour and harassment by colleagues

• Governmental Barriers

—Lack of vigorous, consistent monitoring and law enforcement

—Weaknesses in the formulation and collection of employment-related data which makes it difficult to ascertain the status of groups at the managerial level and to disaggregate the data

 —Inadequate reporting and dissemination of information relevant to glass ceiling issues

A majority of the CEOs interviewed felt that these practices are obstacles to pursuing opportunity. Change can be handled well or it can be handled poorly. Those corporate leaders who have successfully addressed the business barriers to the advancement of minorities and women are those who have squarely confronted the reality that their priorities and the priorities of their middle-and upper-level managers are not always synonymous.

These are the companies who have made the transition to inclusion while continuing to prosper. Their experience demonstrates that barriers can be overcome.

WHAT WORKS TO OVERCOME BUSINESS BARRIERS

There is no "one way" to eliminate the barriers to the advancement of minorities and women in the private sector. Each company is different and each must carefully evaluate its situation and needs. However, analysis of the companies that are managing change effectively indicates that the following characteristics—detailed in this report— are common to all successful glass ceiling initiatives:

• They have CEO support

• They are part of the strategic business plan

• They are specific to the organization

• They are inclusive—they do not exclude white non-Hispanic men

• They address preconceptions and stereo-types

• They emphasize and require accountability up and down the line

• They track progress

• They are comprehensive

THE ENVIRONMENTAL SCAN

Despite the growing number of corporate leaders who consider diversity at the managerial and decisionmaking levels to be an important issue impacting their company’s bottom line, significant barriers continue to exist at various levels within organizations and are experienced differently by different ethnic and racial groups. These barriers impede the advancement of qualified minorities and women. In general, African Americans, American Indians, Asian and Pacific Islander Americans, and Hispanic Americans resist the use of the term minority which they feel implies inferiority. It has been pointed out that in the U.S. any population is a minority if it occupies a subordinate power position in relation to another  population within the same country or society.

African American, American Indian, and Hispanic American men believe that within their groups not enough individuals are earning the degrees that business needs. On the other hand, they also perceive that even those who have these credentials face brick, opaque, and thick glass ceilings that block their advancement to senior-level decision-making positions. 

A survey of senior-level male managers in Fortune 1000 industrial and Fortune 500 service industries shows that almost 97 percent are white, 0.6 are African American, 0.3 percent are Asian, and 0.4 percent are Hispanic. African American men and women comprise less than 2.5 percent of total employment in the top jobs in the private sector. African American men with professional degrees earn only 79 percent of the amount of their white male counterparts; African American women with professional degrees earn only 60 percent of what white males earn. African Americans represent a $257 billion consumer market.

Only 9 percent of American Indians in the work-force hold college degrees. American Indians have the highest high school dropout rate of any ethnic or racial group — 36 percent. According to the 1990 census, only 7,862 American Indians held executive, administrative, or managerial positions at any level, very little of it in the private sector.

From 1960 to 1990, Asian and Pacific Islander Americans were the fastest growing minority group. Asian and Pacific Islander Americans represent a $94 billion consumer market. Asian and Pacific Islander men feel that they have more than sufficient educational credentials and experience and still are kept under the ceiling because they are perceived as superior professionals but not as management material.

Hispanic American men have the highest work-force participation rate of any ethnic group at 78.2 percent. In 1990, 370,000 Hispanic Americans had earned advance degrees now considered essential for climbing the corporate ladder. Hispanic American represent a $175 billion consumer market.

White women in Corporate America agree they have made some movement through the glass ceiling. They are cautiously optimistic but they do not perceive that the problem has been solved. There is still a long way to go and barriers continue to exist. Only two women are CEOs in Fortune 1000 companies. 

Minority women do not see much progress and feel that significant barriers to their advancement still exist. The data show that minorities and white women are increasingly earning the credentials that business needs. However, data also show that women hold only 3 to 5 percent of the senior-level jobs in major corporations. Moreover, only 5 percent of the women who hold those senior-level jobs are minority women.

IN CONCLUSION

Two major strengths of our country—which with the exception of American Indians is a nation of immigrants—have been: 

• the nation’s ability to adapt to perpetual demographic change

• the nation’s remarkable ability in most respects to make self-corrections whenever the contract with its citizenry is threatened or damaged. The body of research detailed in the following section reveals that in the private sector, equally qualified and similarly situated citizens are being denied equal access to advancement into senior-level management on the basis of gender, race, or ethnicity. At the highest levels of corporations the promise of reward for preparation and pursuit of excellence is not equally available to members of all groups. Furthermore, it is against the best interests of business to exclude those Americans who constitute two-thirds of the total population, two-thirds of the consumer markets, and more than half of the workforce (approximately 57 percent).

Source: The Glass Ceiling Commission, USA Dept of Labor, ILR Catherwood Library, Cornell University, USA

Excerpts of the Report: "Good for Business: Making Full Use of the Nation's Human Capital"

 By The Glass Ceiling Commission, USA Department of Labor