The stock prices of the majority of large public companies led by female CEOs have underperformed the S&P 500 so far this year, in some cases by a great deal. While some may use this data to say that women should not run large corporations, a closer analysis shows that companies are neither harmed, nor helped, by the gender of their leaders. Female CEOs face the same challenges as their male counterparts. Some have been extremely poor stewards of their companies and have posted sub-par performances. Others are excellent executives who are rewarded by good stock performance. Still others have done produced superior financial results, but at companies that are in deeply troubled sectors of the economy. 24/7 Wall St. examined the Fortune 500 companies run by female executives and reviewed their CEOs’ performances.
At the start of 2012, there were 11 public companies with sales in excess of $10 billion that were run by women. One, Angela F. Braly of Wellpoint Inc. (NYSE: WLP), was pushed out of her job — as often happens to CEOs. Another, Irene Rosenfeld, ran Kraft, which was broken into two public companies. Rosenfeld continues to run one of those, Mondelēz International Inc. (NASDAQ: MDLZ). We didn’t include these two CEOs in our analysis.
A review of the performance of these female CEOs might cause some people to believe their performances argue for or against the promotion of more women to the chief executive’s office. Research firms, led by Catalyst, have pressed for an increase in the number of female senior managers and board members at large public companies, based on the idea that women are just as qualified to do these jobs as men are. Whether a current female CEO has done poorly or well bears no relationship to the Catalyst case. Success or lack thereof among the small group reviewed here has nothing to do with the overall qualifications of women to hold senior corporate job.
Another argument that could be derived from the presence of female CEOs is that if women have can hold the highest level jobs in corporate America then all women should be treated the same as their male equivalents. Women have been paid less than men for similar work since records on the matter have been kept. The justification of equal pay should be based on merit, and while that merit is obvious, it has no relationship to the job performances of a small sample of CEOs who are extremely successful financially.
The last argument that some make about the sometimes limited success of women in chief executive roles and their small presence at large companies is that women’s careers are hurt when they decide to leave their jobs temporarily to have children. The widely discussed comments by famed former GE CEO Jack Welch to this effect cannot be proved one way or another, or at least have not been. The nine female CEOs on this list are too small a sample to be a reasonable litmus test about the relationship between family and success
The stock prices of seven the nine companies run by these female CEOs run have underperformed the market. The S&P 500 is up 14% year to date. Seven out of nine is a high percentage. But there is no evidence that poor management by female CEOs is to blame. Some of the chief executives on this list have nearly ruined their companies. Ursula Burns of Xerox and Meg Whitman of Hewlett-Packard lead that list. Others have performed extraordinarily well, whether their stocks reflect it or not. Included among those are Carol Meyrowitz of retailer TJX and Patricia Woertz of ADM. On those scales, they have done no better, or worse, than most of their male counterparts.