Shrinking the gender promotion gap: Where There is a Will, There is a Way - Luc Laeven

image from https://www.talentnomics.org/shrinking-the-gender-promotion-gap/

WHY THE GAP?

Several explanations may account for the lack of women in leadership positions. One possibility is that the pool of potential candidates is male dominated. An alternative explanation is that women are less likely to seek leadership positions because of family considerations or different job preferences. The imbalance may also be reinforced by self-fulfilling expectations, whereby the low representation of women at the top of the field discourages others to pursue careers in these fields. Finally, there may be gender-based discrimination in promotion decisions and the selection among potential candidates.

FEMALE PROFESSIONALS AT THE ECB

The research, conducted jointly with Laura Hospido and Ana Lamo, analyses the career progression of men and women at the ECB, using confidential anonymized personnel data from its professional staff during the period 2003–2017. Our analysis focuses on expert staff across four different salary bands representing different levels of seniority (expert, senior expert, principal expert and advisor) in those departments of the ECB that employ economists. With this selected group, we focus on a broadly homogeneous pool of workers in terms of educational attainment and work experience, ensuring comparability across individuals. Moving up to a higher salary band requires a promotion.

Figure 1 shows in more detail that this change in diversity policies in 2010 had material effects on gender differences in promotion outcomes. The figure focuses on promotions from salary band F/G, which is the entry level salary band for professional economists at the ECB. The gender gap in promotions is defined as the difference in the promotion rates of men and women. The promotion gap narrowed from 2011 onwards, following the policy change. While prior to 2011, the gender promotion gap stood at over 36% after ten years since entry, this gap decreased to about 8% on average after 2011, or a decline of about 80 percent.

CONCLUSIONS

Understanding the main drivers of the observed gender promotion gap is critically important to improve our understanding of how we can close the gender gap and ensure that women are adequately represented. The ECB experience shows that a well-designed gender strategy that includes concrete measures can improve the gender balance and foster a more inclusive environment. Our research findings suggest that a key measure of success is an environment in which women seek promotions at the same rate as men. This requires removing any institutional barriers that prevent women to seek promotions while steering outcomes toward a better equilibrium where there is no place for selection biases and self-fulfilling expectations. Much of this needed change can come from within, and companies should embrace and rise to this challenge.

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