Fiorina Firing Highlights Lack of Top Women

The departure of Carly Fiorina from the top slot at Hewlett-Packard last month launched a frenzy of public speculation and media coverage analyzing every aspect of her tenure, her leadership style and whether or not her gender played a role in the ouster.

Fiorina was at the helm of the $80 billion technology giant for five and a half years and was arguably the most powerful woman in corporate America. That made her an icon and the ultimate role model for women in business as she navigated the male-dominated technology industry and steered the 11th-largest company in the Fortune 500 through an industrywide downturn and a controversial proxy battle over the company’s $24 billion merger with Compaq.

But as the dust settles, and as most concur that Fiorina’s firing was based on performance and not gender-related, a larger issue looms. With her departure, the number of female CEOs of Fortune 500 companies would have dropped from eight to seven, had Sara Lee not appointed Brenda Barnes chief executive the very next day. Even as the number remains static at eight, Fiorina’s exit is bringing new attention to the gender imbalance that remains at many of the largest corporations.

“Carly’s departure has been such a big story not because there is a gender-related message in her leaving,” says Elissa Ellis, executive director of the Forte Foundation, a group working to increase women’s leadership in business. “This is a story because one of only eight women CEOs left, and the question is, why do we only have eight, and what can we do to grow that number so it’s not a story anymore?”

Recent data compiled by Catalyst reveals that at Fortune 500 companies, women hold 15.7 percent of corporate officer positions and 9.9 percent of corporate line officer positions and make up just 5.2 percent of the top-earning corporate officers. And the eight female CEOs make up just 1.5 percent of all CEOs at the nation’s largest companies.

Unless companies begin taking a conscious look at who they have filling the profit-and-loss positions in their pipelines, the number of women at the top won’t change anytime soon, says Betty Spence, president of the National Association for Female Executives.

Spence believes a lack experience in the jobs that have P&L responsibility is a major reason so few women command top slots.

“Traditionally, women have been benignly steered into staff positions like communications, human resources and, more recently, legal and finance,” she says. “Those are dead ends. Without profit-and-loss experience, you can’t move on.”

A recent Catalyst study of 353 Fortune 500 companies reveals that companies suffer when there is a lack of women at the top. The data shows that from 1996 to 2000, companies with the highest representation of women in top management achieved 34 percent to 35 percent better financial performance (as measured by return on equity and total return to shareholders) than the companies with below-average female representation.

—Gretchen Weber