FEBRUARY 2006 :: COVER STORY : BIG BUSINESS

The Glass Wall
Women Are Succeeding in Executive Ranks, but Mostly in Select Industries

BY CAROL HYMOWITZ
Staff Reporter of The Wall Street Journal

Around the globe, women are leading companies in new and successful directions.

In Japan, Izumi Kobayashi, president of Merrill Lynch Japan Securities, has taken a business that was hemorrhaging losses and made it profitable. In France, Laurence Parisot recently became the first female president of the country's biggest employers' group. And in the U.S., eBay CEO Margaret C. Whitman has built the Web auction company into a global e-commerce business.

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• A complete list of the finalists in The Wall Street Journal's 50 Women to Watch report, and profiles of each of them

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But hold the applause: While a growing number of women are making their mark in business, their ranks have barely touched large segments of the corporate world. Instead, woman business leaders are largely concentrated in a select group of industries: consumer products, financial services, retail, publishing and media—all businesses with large numbers of woman customers.

"The more you have a female customer base, the sooner companies in that industry start paying attention to how many woman managers they have" who can reach those customers, says Ilene H. Lang, president of Catalyst, a research group that tracks woman executives.

The Journal 50

This became evident when The Wall Street Journal sought to identify 50 women whose talents and positions make them worthy of special attention. The long list of nominees included some who are already at the top and some in line to lead, some who are making their mark as regulators or politicians, and some who have chosen to sit temporarily on the corporate sidelines.

Finding women wasn't the problem; selecting among hundreds was.

The Journal ranked the women based on their potential to make a significant impact on business in the years ahead. The Journal considered a variety of factors, such as their influence in business and their recent accomplishments. Moreover, the Journal considered the challenges the women face in business, and what their response to those challenges may mean for their companies and industries. After much discussion and several rounds of voting among Journal editors and reporters, the list was whittled to 50 finalists.

Their paths say much about their own abilities—as well as the hurdles still facing young women who are just starting business careers.

Clearly, it's a big advantage for women to work in companies that depend on female customers and for a CEO who believes that work-force diversity is a business imperative. More than half of the women on our list who are already "running the show" or "in line to lead" work in consumer products, financial services, media and publishing, or retail.

Susan Arnold, vice chairman at Procter & Gamble, oversees Clairol, Olay and the company's other beauty brands world-wide, which generate roughly a third of the company's revenue. Her boss, P&G Chairman and CEO A.G. Lafley, believes the company's recipe for success has been to uncover and cater to the habits and tastes of its mostly female consumers. One way he has pushed this strategy is to promote women like Ms. Arnold.

Meanwhile, women such as Merrill Lynch's Ms. Kobayashi; Marion Sandler, co-CEO of Golden West Financial; Zoe Cruz, acting president of Morgan Stanley; and Joyce Chang, managing director of J.P. Morgan Chase, have benefited from a trend in financial services that began more than two decades ago of finding ways to target female customers.

But the women on our list are present in more than a few industries. Xie Qihua, chairwoman of Shanghai Baosteel, China's largest steel producer, and Linda Cook, executive director, gas and power, at Royal Dutch Shell, have both climbed the ranks in what are considered traditionally male-dominated industries.

Stereotypical Thinking

Carol Bartz, chief executive of Autodesk, links her rise to the top of a software company to her early interest in math, which, she says, was never discouraged. She was raised on a farm in Wisconsin, and in the rural schools she attended, "no one ever told me I couldn't do math because I was a girl," she says.

She worries that young women will be excluded from opportunities in technology companies if they are discouraged from studying math and science. On a recent tour of colleges with her 17-year-old daughter, she was startled when, at one stop, "my daughter was assured she could fulfill the math requirement by taking a course on the history of women in math," she says. "No one said anything about a ‘history of men in math' course—or calculus," she adds.

Wherever they work, woman business leaders have faced stereotypical thinking about what they can and can't do well. A recent survey of 296 executives by Catalyst found that men believe women are less skilled at problem solving, one of the qualities most associated with effective leaders. And both men and women surveyed said women are less skilled than men at delegating and "influencing upward."

The women to watch in business have challenged these stereotypes partly by taking on high-risk assignments—such as turning around a troubled division that their male colleagues didn't want to run. Some have steadily climbed the ranks of one company, but many have zigzagged their way to the top by jumping across companies and industries.

EBay's Ms. Whitman started her career at P&G after earning an M.B.A. from Harvard, then became a consultant at Bain & Co., went next to Walt Disney as a senior vice president and subsequently was president of Stride Rite and then president and CEO of FTD, the floral delivery company. She also was general manager of Hasbro's preschool-toy division.

Autodesk's Ms. Bartz, after earning a computer-science degree at the University of Wisconsin, worked at 3M, and then got her big career break, she says, when she became one of the first woman sales managers at Digital Equipment. She then moved to Sun Microsystems before being named CEO of Autodesk.

These women certainly don't share a single management style or lifestyle. But whether they carefully planned their career moves or are surprised that they've advanced so far, they share a deep excitement about the chance to run and build businesses and motivate others. "I'm never bored," says Ms. Bartz.

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