TRANSEARCH International

News and Insight from Global Executive Search Firm TRANSEARCH International

Tuesday, 20 November 2012

Achieving Leadership Capital Advantage

Managing talent and growing the next generation of business leaders are becoming recognised as the keys to achieving human capital advantage over the competition in a global knowledge economy. Given the projected talent deficit that will follow the retirement of millions of so-called 'Baby Boomer' managers and executives over the next 20 years, women leaders may invariably be seen by an increasing number of employers as an untapped source of talent, experience and senior-management leadership.

Women bring the same academic credentials, energy, interest, and intelligence to their work as their male colleagues. Yet startlingly fewer of them factor into corporate management succession plans much later in their careers. Significant organisational change to identify and reverse the institutional dynamics that derail, de-motivate and/or devalue the career advancement of women is required.

As many organisations grapple with a mandate to recruit, develop and retain tomorrow's leaders, there is much to learn about today's corporate leadership profile. The following data puts the reality and the challenge into perspective:
  • Women held only 17 percent of seats on the boards of Fortune 100 companies and just 11 percent of FTSE 100 directorships, according to The Alliance for Board Diversity and The Equality and Human Rights Commission, respectively.
  • One of the Alliance's member institutions, Catalyst, has reportedly found no increase in women on Fortune 500 boards in three years, yet is has also documented a strikingly positive correlation between the number of women on the boards of companies and the number of women who ultimately become corporate officers of the same company.
  • Companies with a higher proportion of women in top management may perform better, according to a McKinsey study.
  • Although women earn less than their male counterparts, they make more than 80% of the purchasing decisions in American homes, BusinessWeek reports.
  • A new law that took effect recently mandates that 40% of board seats for 487 public companies must be held by women, according to Bloomberg.
  • Only 43% of women professionals feel well-equipped to compete in the business economy of the future, according to a report issued by Accenture.
  • In 2007, women comprised just 6% of the best-compensated executives, according to research by The Forum of Executive Women (Philadelphia).
Looking ahead, it's hard to imagine that the companies on the leading edge of the knowledge economy will get there or stay there without leveraging the experience and talents of women business leaders as their consumer segments continue to globalize and diversify.

Women executives will play an increasingly critical role in building and shaping marketleading institutions in the years to come. The challenge for these organizations, therefore, is to understand the challenges unique to women leaders and how to address them in a way that expands the talent pool for a wide range of critical business functions. Astute executive search practices are increasingly aware of the need to create women's leadership initiatives aimed at leveling the playing field for career and organizational advancement.
TRANSEARCH International is one of the leading executive search organisations in the world. Visit our website to learn more about our wide-ranging approach to leadership acquisition and management assessment.