Skirting the issues: a 'green ceiling' for entrepreneurs?
From the Briefcase: Research produced by America's Best Business Schools
"What the basic model showed was that the CEO's sex had a direct effect on the attractiveness of the IPO," said McLean Parks. "By making stereotypical assumptions about her capabilities, the IPO became less attractive. Which means that woman-led firms hoping to go public will have a much harder time finding backers, even though research indicates that the chances for success are just as likely–if not more likely–than a company run by a male."
Bigelow and McLean Parks found that both male and female participants held a less favorable view of female CEOs, but women judged the female CEO less harshly than men did. Both men and women had a kinder opinion of the CEOs of their own sex, yet women CEOs still fared worse than men.
"The questions we asked revealed some latent biases," Bigelow said. "I'm sure people don't consciously say, 'Oh, she's a woman, therefore she's not a good leader.' But people did reveal biases they might not have known they had. When we compared the biases to see if they were based on reality, we found that they weren't. Research suggests that when there are many women in senior management, firms tend to do better."
There's no way to prove that woman-run firms perform better expressly because they are run by a woman, Bigelow and McLean Parks said. However, firms that are open to nontraditional models of leadership probably make better use of their human resources, enhancing all employees' performance as well as the success of the company.
The findings may appear bleak at first blush, said McLean Parks, "but the good news is that women are continuing to work in organizations and pursue entrepreneurial ventures. They just may have a hard time getting the financing they need to launch new ventures or make capital improvements. But women are out there, and sooner or later the evidence of their success may start changing people's latent biases."
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