Does Institutional Bias Impact Women Leaders?

“The number of women in top leadership roles at Fortune 500 organizations has stagnated around 5% for many years, despite a host of programs and initiatives designed to facilitate the promotion of a new generation of women leaders. When you consider the fact that there is mounting empirical evidence that corporations display stronger financial performance with women in senior leadership roles, the fact that this number has remained relatively unchanged is puzzling. For instance, Fortune 1000 companies with a woman in the top role saw an average return of 103.4 percent over the women’s tenures, compared to an average 69.5 percent return for the S&P 500 stock index over the same periods. Hedge funds run by women had a 6 percent return between 2007 and 2013, beating both a global hedge fund index at the stock market. Numerous studies have also found that companies with women on their boards of directors perform better than male-only boards (source – Think Progress online, July 14, 2014).”

So, what’s going on?

One answer might be institutional bias, which is caused by systemic organizational procedures and practices (written or unwritten, subtle or overt) resulting in differential outcomes for members of different groups. For example, an HR Director responsible for hiring fire fighters could be completely free of individual bias, but may perpetuate institutional discrimination against women simply by adhering to the company’s minimum height requirements (process and procedures of the organization), which inadvertently promotes continuing bias against women.  More subtly, my good friend and colleague experienced this when she became a mother.  Once a mover and shaker, she was automatically given less prominent clients, post baby. Over time, she began to earn less in bonuses, worked with less visible clientele, ultimately creating fewer opportunities for promotions (based on her given portfolio).

Unfortunately, I’ve observed organizations address some of the symptoms of institutional bias rather than the real, underlying problems.  For example, many organizations have diversity & inclusion programs to address bias and discrimination by individuals. The problem is that bias occurs in various ways, not just through the practices of individuals.  Therefore, without reviewing and correcting the written and unwritten policies and procedures, women will continue to struggle for gender parity.

What’s your personal experience with institutional bias? What do you think can be done to address these issues within organizations?

We would love to know your thoughts!