Just 32 Fortune 500 companies are led by women. While that amounts to a meager 6.4 percent of Fortune 500 companies, it still represents a solid increase from 21 companies in 2016 and is the highest proportion of female CEOs on the list in the history of the Fortune 500. As recently as 1995, there were no female CEOs on the Fortune 500 list.
A recent Associated Press/Equilar analysis of the largest public U.S. companies shows that the median female CEO earned $13.1 million in 2016, compared with $11.4 million for the median male CEO. That’s a pretty big difference So, while women still represent a very small percentage of CEOs, when they do reach that corner office, they make more money – on average – than their male counterparts d0.
According to a May 2017 story in The Washington Post, the AP/Equilar study showed that among the 25 highest-paid CEOs in 2016, only five were women. The story notes that the highest-paid woman, IBM’s Virginia Rometty, earned $32.3 million in 2016. Then there was Yahoo’s Marissa Mayer, with a package valued at $27.4 million in 2016. Pepsi’s Indra Nooyi followed with $25.2 million.
What’s happening here? The Washington Post story cites a few theories. One explanation is company size. Many women CEOs are running large companies, and as recruiters well know, there’s always a relationship between annual revenue and executive pay. Another theory is what has been referred to as a “diversity premium”: Organizational diversity goals adopted by companies, especially the largest ones, may lead to higher pay packages to entice high-potential women.
The larger question is how to get more women into the top jobs. Progress has been slow, but there are some positive trends afoot.
In a recent blog post for Best Business Schools, Lee Davidson of the Association to Advance Collegiate Schools of Business (AACSB) noted that of the 32 women CEOs on this year’s Fortune 500 list, 23 attended business school. Davidson points out that initiatives to encourage and support female business students are a growing priority.
Additionally, Fortune 500 companies with a greater number of women board members tend to perform better financially, according to a survey from Catalyst. A 2016 McKinsey & Company survey found that women currently hold 33-37 percent of management, senior management, and director positions across all industries and a quarter of C-suite jobs.
Here are some more insights about women CEOs from this year’s Fortune 500 list:
- Women run seven of the country’s largest companies. This includes Mary Barra of General Motors, Ginni Rometty of IBM, Indra Nooyi of PepsiCo, and Marillyn Hewson of Lockheed Martin.
- Roughly one-third of the women running Fortune 500 companies are new to the job. Eleven women were named CEO in 2016 or early 2017, including Vicki Hollub of Occidental Petroleum, Tricia Griffith of Progressive, Shira Goodman of Staples, Margo Georgiadis of Mattel, and Michele Buck of Hershey.
- Women run a diverse range of companies, from consumer goods behemoths like PepsiCo to defense contractors like Lockheed Martin. However, women CEOs are, predominantly, white. Currently, just two names on the list are women of color: Geisha Williams of PG&E Corporation and Indra Nooyi of PepsiCo.
Sharon Gillenwater is the founder and editor-in-chief of Boardroom Insiders, which maintains an extensive database of in-depth executive profiles.