Women in the United States are becoming increasingly educated and focused on building careers to join the executive ranks, but while some are charging forward with graduate level degrees, others struggle to obtain fair employment with a livable wage. Currently, 38% of young women have at least a four-year college degree, compared with 31% of young men. This almost reverses the 8% gap in 1970 when 20% of men had at least a four year college degree and only 12% of women. However, while women are becoming more educated, they continue to be the minority in business executive level positions; only 14.6% of the Executive Officers at Fortune 500 companies are women.
The good news is that improving diversity in the workplace encourages business growth. A McKinsey study found that the growth in women in the workforce from 1970-2009, from 37%-48%, accounts for one-quarter of the US economic growth; and the non-profit group Catalyst found a 26% increased return on invested capital (ROIC) between the top-quartile of companies with 19-44% female board representation versus the bottom quartile of companies that had no female board members.
Erika Karp, CEO of Cornerstone Capital, was recently interviewed by Bloomberg about the importance of empowering women in the workplace for economic strength (see video here). Karp highlights companies that understand the importance of empowering women as an economic input leading to profitability, including some that have – as defined in a piece co-written by Karp and Derek Yach – “embraced the grey”. This refers to understanding that perfect is the enemy of good and that the challenge is to continue improving gradually rather than expect a one-stop solution. Karp says, “Corporate excellence and diversity are inexplicably linked.” We couldn’t agree more.
