Working Girls

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MARCH 19, 2007

Working Girls

Gretchen Morgenson is a business columnist at The New York Times.

No Seat at the Table: How Corporate Governance and Law Keep WomenOut of the Boardroom

By Douglas M. Branson

(New York University Press, 239 pp., $40)

Selling Women Short: Gender and Money on Wall Street

By Louise Marie Roth

(Princeton University Press, 269 pp., $27.95)

Opting Out?: Why Women Really Quit Careers and Head Home

By Pamela Stone

(University of California Press, 288 pp., $24.95)

Differences of opinion make the world go around, and most of us aregrateful for them. Two investors looking at the same stock arecontent to draw opposing conclusions on its merits. Two financialanalysts scanning identical data can make compelling cases on theeconomy, one bullish, one bearish. One reviewer predicts that amovie will be a hit, while another says it will flop. But when itcomes to the subject of women in business, the discussion is soone-sided that it hardly qualifies as a debate. Thirty years afterwomen began migrating to the business world in large numbers, thedreary drumbeat from many quarters remains the same. Glassceilings, family-unfriendly companies, men's-club mentalities: allcontribute to a bias against women that persists in spite ofanti-discrimination laws that are decades old.

Or such is the message of these new books. They all argue that ananti- female view has become ingrained in corporations, on WallStreet, and in boardrooms. Today's discrimination is different,they say: no longer personal, such as sexual harassment by asuperior or macho banter by colleagues, it is now faceless andinstitutionalized. When women fail, it is not so much becauseindividuals hampered them, but because "the system" or "the culture"did. The discrimination is less titillating, but more pervasive.

Is this right? Does it adequately account for the nation's vast,protean workplace, and for the numbers of women in high-level jobs?Or is it a handy argument for some women to explain away their owncareer disappointments? Viewing women as victims of discriminationcertainly seems to ignore the considerable progress that women havemade in recent years across a wide swath of business. And it seemsincongruent in a year when a woman is running for president of theUnited States, the newly elected speaker of the House ofRepresentatives is a woman, and the new president of Harvard is awoman.

The victim view also discounts the considerably richer choices thatthe workplace now offers women, many of whom would gladly trade offthe executive- suite chase for more time with their families. Howmany potential female CEO's have exited the race because theysimply did not think the possible rewards of an unrelentingcorporate climb were worth the sacrifice of family relationships?Or as Claudia Goldin, an economist at Harvard who has writtenextensively about women's work, told The New York Times in December,"Do we want everyone to have an equal chance to work 80 hours intheir prime reproductive years? Yes, but we don't expect them totake that chance equally often."

Or do we? Many of those arguing that discrimination in the ranks ofAmerican capitalism remains a deeply structural problem for womentoday begin by rejecting the idea that choice has anything to dowith the disappointingly small number of women running corporationsor holding board seats. When women leave their careers to becomefull-time mothers, these authors maintain, they do so solely as aresult of pressure from the workplace. Similarly, there is noallowance for women who choose not to climb the ladder past acertain point because they want to have time with their families.Women making these choices may not know it, but they are at themercy of institutionalized discrimination.

This is a sort of retro-feminism, stuck in a place that has not beenthe reality for decades. The universe that they describe does notresemble even the one that I encountered on Wall Street during theearly 1980s, when I was a stockbroker at a large New York Citybrokerage firm. Back then, women were genuine minorities at thesefirms; but even so, my experience was one of an industry offeringunadulterated opportunity. Stress and pressure to perform were aconstant. Frat-house behavior was annoyingly common. Butdiscrimination? Not in my experience, even during what can only beconsidered the Stone Age for women on Wall Street.

? ? ?

These days, few topics stir more emotion than the question ofwomen's progress--or otherwise--in business. Personal decisionsmade by women in the career/family balance are viewed through ahighly politicized prism. Married women who jump off the fasttrack, becoming homemakers and mothers, are said to be selling outtheir sisters and aiding the enemy in the battle for equality.Indeed, Pamela Stone said she set out to write Opting Out? to offera response to stories in the popular media that trumpeted "aso-called trend of high- achieving women 'returning home' since the1980s, a trend depicted primarily as a function of women's changingpreferences and choices."

When high-level female executives fail in this polarizedenvironment, their flameouts are said to hurt all women toiling onthe road to the corner suite or boardroom. (Think of Carly Fiorina,the former chief executive at Hewlett- Packard, and probably themost renowned of all the alleged casualties of corporate misogyny.)Women fired for incompetence are often characterized as victims,not as perpetrators of mismanagement that may harm a company'sworkers and shareholders.

That women still get (or get away with) victim status seems to beliethe great headway they have made in business, even in traditionallymale-dominated fields. A study by the Bureau of Labor Statistics in2005, for example, found that women made up 52 percent of financialmanagers and 62 percent of accountants and auditors. And a 2003study by the Equal Employment Opportunity Commission of roughly1,400 companies with 100 or more employees and federal contractorswith 50 or more employees found that women made up 33.7 percent ofofficials and managers of securities and commodities firms. Womenaccounted for 29.5 percent of officials and managers at 637investment banks (a subset of the larger figure), and femalestotaled 48.6 percent of officials and managers at 3, 908commercials banks. At 900 accounting firms, 38 percent of officialswere women.

The numbers of women plummet, however, when it comes to executivesuites and corporate boardrooms. Only 2 percent of Fortune 1000companies are overseen by female chief executives, and in 2005Douglas Branson's researchers found only 568 female directorssitting in 5,161 board seats at Fortune 500 companies. Around 12percent of those companies did not have a single female director,and 29 percent had only one woman on their board, Branson reports.Figures such as these make his book the most compelling andcredible of the three. Branson argues that women do not make it tothe boardroom because those responsible for nominatingdirectors--board committees and top executives, who are mostlymale-- conclude that women's personalities and cultural backgroundsdo not suit the demands of a directorship. "The model's paradigm isa standup, ruggedly individualistic director (male) who will removean underperforming CEO or file a lawsuit when he has to," Bransonwrites. "Women may not have the right qualities, or may beperceived that way, in part because those qualities may not be asapparent in women as in men." And so women do not get the nod.

The dearth of women in the boardroom is certainly discouraging.Branson ends his book with recommendations for how women can changetheir behavior to get noticed by nominating committees. But do theboardroom figures signify broad- based systematic discrimination incorporate America? Perhaps not. There is no doubt that sexdiscrimination has not been eradicated from all workplaces. Moredisturbing, recent studies show a widening pay gap between men andwomen with equivalent credentials and experience. These paydifferences may be an anomaly, but they surprise many socialscientists and anger hardworking women.

But measuring the depth of discrimination against women is fartrickier than assessing the pay gap between males and females.Perhaps not surprisingly, those who argue that women remain underassault often fail to support the thesis with rigorous quantitativeresearch. Instead, many base their conclusions on anecdotal and"qualitative" studies that take the experiences of a handful ofwomen and apply them to the general population.

Arguing that discrimination continues to thwart women even as it hasmorphed from the personal to the institutional may be somethingthat some women want to hear. Knowing that it is not just your bosswho is out to get you but an entire institution can explain away agood deal of disappointment. But pointing to broad-basedconspiracies is not likely to help women to navigate everydaycareer shoals or to achieve a meaningful balance between work andfamily. The fact that some talented and ambitious women might lowertheir sights after reading these books makes them even a littlepernicious. Then again, women who have gone places in businessusually have not done so by whining about discrimination or bias.

Wall Street, with its rich rewards and its picaresque characters, isone of the crucial workplaces where discrimination has becomesubtler, according to Louise Marie Roth. Blatant, boorish behaviorby Cro-Magnon males has been replaced, she contends, by a moremuted bias that creates "endemic firm- and industry-widediscrimination against women and minorities." This type ofdiscrimination "does not rest on individual acts of meanness, inwhich some people consciously limit the opportunities of women, buton the interpersonal and organizational dynamics that subtly andoften unintentionally re-create inequality."

And Pamela Stone looks at the broader world of business to draw asimilar conclusion. Women who leave the workforce to raise theirchildren are not doing so by choice, she argues, but because theirhidebound organizations prevent them from managing both work andfamily life, and their husbands are unwilling to step in asstay-at-home parents. "Married to fellow professionals, who facethe same pressures at work that they do, women are home alone," shewrites, "and go home because they have been unsuccessful in theirefforts to obtain flexibility or, for those who were able to,because they found themselves marginalized and stigmatized,negatively reinforced for trying to hold on to their careers afterbecoming mothers."

In both books, the conclusions are sweeping, but the samples used towarrant them are not. To anyone truly interested in plumbing theproblem of discrimination against women in the workplace,perceptions and anecdotes often prove little. Roth and Stone basetheir pronouncements on interviews with a relatively small numberof people, all of whom have been assigned false names. Rothinterviewed seventy-six people--forty-four women and thirty-two men.Her group, she said, consisted of elite MBA graduates who begantheir careers at top Wall Street firms in the early 1990s. Thesemen and women graduated between 1991 and 1993 and were from similarbackgrounds with like credentials. The interviews took place in1998 and early 1999 and included complete career histories fromthese people before they received their MBA degrees. Stone spokewith fifty-four women for her book, using what she describes as "theintensive life history interview." From these discussions, shetakes the reader through the "trajectory of these women's lives"and their decisions to leave the workforce. "The exits of highlytalented women are the miners' canary," Stone concludes, "afrontline indication that something is seriously amiss in too manyworkplaces."

Real-world stories from people such as "Kate Hadley," athirty-nine-year-old mother of three children with an MBA fromWharton and a big job at a consumer- goods company, and "ElizabethBrand," a forty-year-old pregnant mother of one who was a risingmanagement consultant, make Opting Out? exceedingly readable. Butits liveliness should not disguise the limitations of its analysis.Like Selling Women Short, it gives only one side of these women'sstories. Never is the reader told how the people who worked aroundthese women--whether as bosses, peers, or subordinates--rated theirperformances. There is no reality check; there is only thesympathetic credulity of the interviewer. But an individual's ownviews on her (or his) career trajectory are almost certainlydistorted. The question is by how much.

An anecdote in Selling Women Short furnishes a fine illustration ofthe problem. It describes how "Mia," a research analyst, was firedby her Wall Street firm after she had her first baby and when shewas expecting another. While "Mia" described the circumstancessurrounding her termination as discrimination, any other factorsthat might have been at work are not discussed. Roth writes onlythat "for eighteen months after her first child was born, sheworked long hours and traveled a lot, getting up at 5:30 everymorning, working until 5:00, and then doing additional work at homeafter her child went to sleep. But her peers and managers stillresented her and her firm fired her. This solidified her decisionto leave the labor force."

In Opting Out?, the marriages of Stone's interviewees are central toher thesis that women are not given the chance to stay in theworkforce because their husbands' careers come first. And yet thehusbands are not heard from. Instead, most of these men aredescribed as continuing their careers without missing a beat; andby encouraging their wives to step off the fast track, they becamea big factor in the women's decisions to leave the workplace.Failing to support wives who wanted to keep working made these menpart of the problem, Stone argues. There is a lot of "she said,"but there is no "he said."

Even the men who let their wives choose whether to keep working areobstacles, according to Stone. "'It's your choice' was code for'It's your problem,'" she writes. "Veiled behind the seeminglyegalitarian rhetoric of 'support' and 'choice,' husbands were ineffect giving their wives permission to quit their careers, andsignaling at the same time that women's careers were not worthwhileenough to merit any behavioral changes on their (the husbands')part." That women and men might experience a different reality insuch situations is a major methodological, even philosophical,problem with these books. Differences of opinion are, after all,central to the battle between the sexes.

Consider, for example, the gaps between male and female views on payequity as indicated by a study called "Report to Women in CapitalMarkets," which was published in 2005 by Catalyst, an organizationthat analyzes women in the workforce. Respondents in the study wereasked whether they agreed or disagreed with several questions. Onequestion was this: are women and men paid comparable salaries forsimilar work? Some 26 percent of women agreed, compared with 67percent of men.

Another Catalyst study, "Women in Financial Services: The Word onthe Street, " also found deep differences between men and women onseveral issues. For instance, 65 percent of women in the studyreported that they must work harder than men to get the samerewards, while only 13 percent of men agreed with the statement.And while 51 percent of women reported that they are paid less thanmen for doing similar work, only 8 percent of men agreed. Some 42percent of women said clients and projects were fairly assignedwithin their firms, while 55 percent of men said so. Interestingly,men and women agreed on only one topic: 57 percent of both men andwomen are unsatisfied with their ability to control their workschedules.

Roth's book also suffers from a naivete about cycles in thefinancial markets that can help to determine success or failure ina career. Roth claims that men were more likely to do better onWall Street because they specialized in "higher-revenue industrieslike natural resources, technology, or financial institutions whilewomen were more likely to specialize in lower-revenue areas likeemerging markets." But in recent years, emerging markets have beenan amazing growth engine that would have produced enormous bonusesfor almost anyone involved in them. (Some of Roth's assumptions aredownright amusing. Thus she allows that the way in which accountswere distributed to salespeople could contribute to "a gender gapin pay in sales and trading" if the allocation of accounts wereunfair. Then she quotes "Barbara," who said that her experiencewith account allocation was that it was "unfairly biased towardpeople who were verbally demanding--who tended to be men.")

Both Roth and Stone lean heavily on old data. For instance, in asection of Selling Women Short that deals with how women interactedwith clients, Roth argues that Wall Street executives hired peoplethat they assumed their firms' clients would prefer--which is tosay, white males. Yet one of the studies cited as bolstering thisview was published in 1990, meaning that its data were collectedeven earlier. While there is some of this statistical antiquity inBranson's book--it relies on a 1987 study in its discussions ofbiases against women whose husbands work--it also presents plentyof original and current research on women in boardrooms.

Some of the examples that Roth and Stone cite as evidence ofinstitutionalized discrimination tend to undermine their arguments.Stone, for instance, recounts the story of "Dorothy Lennon," abanker whose boss told her that she would not receive a bonus whenshe was pregnant because he expected her to be sick a lot. Dorothyappealed to her human resources department, Stone wrote, which"came down hard on him, but the episode signaled to [Dorothy] thatpregnancy was a hot-button subject." Couldn't the reaction of thehuman resources department instead have signaled the commitment ofthe corporation to stamp out such gross male behavior?

Roth describes a situation in which one of her female Wall Streetsubjects was at a client meeting accompanied by a high-levelexecutive from her firm. One of her colleagues had not come to themeeting because she was pregnant. "Damned women. Always gettingpregnant," muttered the Wall Street executive, according to theanecdote. Later, the client at the meeting told the executive thathis behavior was offensive and took away the business from the firm.But instead of evidence that the world is changing, this anecdotein Roth's hands illustrated "the blatant hostility that managerscould have toward pregnant workers and how it created aninhospitable work environment for all women."

As for Stone, even when most of her subjects insist that they hadmade the choice to stay home, she refuses to accept their views.The rhetoric of choice, Stone writes, "often had the effect ofobscuring or rendering invisible to them the constraints they facedand under which their decisions were actually carried out." Whyconduct interviews if you are not listening to what your subjectssay?

? ? ?

Stone ends her book with prescriptions for more flexibility in theworkplace and other solutions that would allow women to balancework and family better. She suggests that companies "destigmatize"part-time work and "challenge" the long-hour culture. These arenice ideas, but to anyone who has worked for a public companyrecently, they are not realistic.

Branson makes a better argument for how corporate boards can improvetheir companies' performance by embracing women. Monitoringcorporate management, a duty of directors who representshareholders, can best be done by achieving a greater balance inthe boardroom, he writes. Diversity of views, says Branson, "isnecessary to avoid the perils of 'groupthink' in appointing a C.E.O.or a C. F.O., and in strategic planning." Among other perils,groupthink causes "the board to avoid hard questions or otherwiserock the boat," leading to a sense of invincibility and isolation.The point is not that women or minorities will always help boardsavoid these shoals, Branson wisely adds. "The point is thatgroupthink is less likely in the presence of diversity and withdiversity as an avowed goal."

How to achieve this end? Branson proposes that every public companycould put a woman on its nominating committee. Also, boards shouldget rid of directors who sit on more than three public-companyboards, thereby opening up the number of director slots availableto women. Women must also make themselves more attractive toboards, he suggests. He advises women to take a less direct routeto the top: teaching or taking a high-level position at a nonprofitorganization may lead to the boardroom. "There is no one paradigmfor advancement of women," he writes. "The paradigm mutates as awoman's career advances, much more so than a man's." As a result, awoman might have to be aggressive early on, and then transformherself into a stateswoman. Finally, Branson asserts, she may haveto become more aggressive again, as she climbs the ladder. It is aninteresting thesis, one that makes sense.

At least toward the end of her book, Roth becomes more nuanced andmore sensible, reflecting that women's limited progress on WallStreet may be related to forces other than discrimination. Sheconcedes that "gender equity might be achievable in highlydemanding jobs if it were not for work-family issues thatdisproportionately affect women." Yes, indeed--and perhaps becausewomen choose to let family issues take precedence.

Roth's book becomes much more satisfying in its final chapters,where it recounts the strategies women devised to succeed on WallStreet. Examples included identifying a mentor and pursuing jobswhere productivity is tangible and undeniable. This meant workingin fields in which their contributions could be measured--such ason trading desks, where they had their own profit-and-lossresponsibilities--and choosing industries where they would beevaluated more on production and less on subjective criteria suchas client relationships.

It is not until the next-to-last page of the book that readers learnthat one-quarter of the Wall Street women in Roth's samplesucceeded "within this system by its own standards." Theirexperiences, the author noted, "demonstrate that the glass ceilingis not impermeable." But such a notion may not sell books. Betterto portray "systematic inequality" than actual existing women inall their complexity. American business is now riddled with storiesof women shattering barriers. There is still some way to go,obviously; but an essential part of progress is learning to takeyes for an answer.

By Gretchen Morgenson

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