A December 2000 story by Katie Dean in Wired noted that new research by University of Michigan B-school professor Theresa Wellborne “found that for rapidly growing IPO companies, the initial stock price, stock price growth, and growth in earnings over three years were higher with women executives.” Wellborne’s report goes on to also note that, “The results from the long-term study indicate that having women on the top management team results in higher earnings and greater shareholder wealth.” So what does this mean?
This is very interesting, given how few women hold top management positions in public companies (or any large companies, for that matter). One would think that profit-driven companies and shareholders might learn from these types of studies, but what is even more interesting to me is how much a role gender stereotypes continue to play in determining why women are “better” managers than men. Back in October, I covered a story about former Hewlett-Packard honcho Carly Fiorina on my BlogHer feminism & gender beat. Her autobiography had just hit the shelves of bookstores, and Maureen Dowd wrote a snithering article about female management style.
It seems that since Wellbourne published her research, things have not been so rosy for women in the corporate office. Dowd wrote: With several of the few high-profile women at the top tanking, it’s interesting to note that Columbia Business School has introduced a new program that teaches the importance of a more empathetic and sensitive leadership style in globalized business… Students learn to read facial expressions, body language and posture, and get coaching on their brains “mirror neurons” – how what they’re thinking and feeling can affect others.
“This less autocratic leadership style draws on capabilities in which women are as good as men,” says Michael Morris, a professor of psychology and management who is running the business school’s new program.
Daniel Goleman, whose new book “Social Intelligence” is being taught in the program, points out that “while women are, in general, better at reading emotions, men tend to be better at managing them during a crisis. Women tend to be more sophisticated in reading social interactions but also tend to ruminate more when things go wrong.”One student took these “brilliant” lessons to heart: Neenu Sharma, an MBA student in the new Columbia program, says the moral of the story is that leadership works best with both sexes involved. “You need the woman there to know what’s actually going on, but you need the man there to deal with the critical emotions at the time.”</blockquote>Yes, thank you for that inane and ludicrous insight in gender stereotypes, Ms. Sharma. I feel much more confident knowing that you may someday be affiliated with the investments I make. Sigh.
Anyway, Wellborne also notes: In addition, we cannot forget the fact that many investors today are women, and it is quite possible that women are a bit biased toward firms with top management teams that employ women. Or, ‘hot companies’ (those that are getting higher levels of market/book or Tobin’s Q at the IPO) may be the types of firms that can attract women executives. Unfortunately, given the relative lack of data on this subject, most of these explanations are speculative.The point is, we don’t know why firms with women executives perform better than those without. It could be an infinite number of reasons. But before we go running around training women to be indecisive, drooling fools who “know what’s going on” but then hand over all the decision-making powers to male colleagues, we sure better find out. There’s a lot riding on it.