Female CEO's are paid less then Male CEO's. Why?

~ Laura

Bloomberg had an excellent article about compensation for men and women leaders who work at companies on the S&P 500 list. They found that women executives were paid much less than their male counterparts.

Last year, of the five best-paid executives at each of the Standard & Poor’s 500 Index companies, 198 were women, or 8 percent of the total. Those high-achievers on average earned $5.3 million, 18 percent less than men, data compiled by Bloomberg show.

Really good research and a well-done article.

I would love to see more research about why this is the case. Overall, childless women and men earn about the same amount of money. The big discrepancies in pay come into play when women have children. They are much more likely to take time off and take advantage of flex time and are screwed over for that. Terribly annoying. Here, women! Take advantage of family-friendly policies. Aren’t we a great company? But expect a huge dock in pay and be prepared to be the first to go, if there are company layoffs! 

However, women who make it to the top echelon of business are the lean-in types, who don’t take time off or use flex time. So, that wouldn’t explain the difference in pay.

There are three other explanations: 1) plain old sexism, 2) women don’t advocate for themselves, 3)these women are a lot younger than their male counterparts and haven’t had enough years of promotions.

What explanation do you choose?

(I really, really wish that I had more time to write something longer and more thoughtful on this topic. But the driving schedule is kicking my ass right now.)

Published by Laura

5 thoughts on “Female CEO's are paid less then Male CEO's. Why?”

  2. Perhaps female executives care more about what others think of them. Thus, they don’t press for the really shameless salaries some men demand. Or, they don’t jump ship from company to company as often.

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  3. I am not a CEO or top executive or anything close to it. But when I go into my annual performance meeting, I negotiate for things like: the ability to work from home a day or two a week; the abilty to volunteer in my kid’s class for an hour a week; the ability to leave at 3 pm, extra vacation time, etc. I do not ask for more money. In my mind, I make enough money. I don’t need more money. I need more time, so I ask for that. And so far, have received it. (Again, that doesn’t explain why a top executive would make less money.) But perhaps some people (women? I don’t know if it is necessarily gender specific) don’t view more money as the perk that others do? And negotiate for other things? (interesting work, less/more travel, sabaticals?)

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  4. Your decision to prioritize time over money is very typical of most women workers and that’s why most women w/children are paid less than men. But nobody gets to be CEO of a company, if they leave at 3 or ask for extra vacation time. That’s not why these women are paid less than their male counterparts.

    I also don’t buy that women leaders are more collaborative and so they ask for less money. Again, nobody gets to be the head at at big firm by being nice. Believe me, if you hate male CEO’s, then you’ll hate female CEO’s as well. Same breed, different hair.

    So, the choice that wins is 3). Women CEO’s get paid a lot less because they are younger than their male counterparts.

    See, that was easy.

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  5. “I also don’t buy that women leaders are more collaborative and so they ask for less money. Again, nobody gets to be the head at at big firm by being nice. Believe me, if you hate male CEO’s, then you’ll hate female CEO’s as well. Same breed, different hair.

    “So, the choice that wins is 3). Women CEO’s get paid a lot less because they are younger than their male counterparts.”

    How about, women don’t ask for as much money because they don’t feel like there’s any functional difference between $10 and $20 million a year, and that’s not how they are interested in keeping score.

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