Women in the workforce need to show more evidence of skills than men

New research published in the European Corporate Governance Institute Finance Working Paper shows that women in the workforce are required to provide more evidence of their skills to reach leadership positions.

Conducted by Prof. Alexandra Niessen-Ruenzi, Chair of Corporate Governance, at the University of Mannheim Business School (UMBS), the research found that observable signals of professional and educational qualifications are more important for women's career advancement than men's.

Along with PhD candidates Lea Zimmer, they investigated the two categories of skill: signals of higher education and signals of professional experience.

The findings were that signs of higher education and professional experience increase men's probability of entering a leadership role by 5.9 per cent and their pay by 6.8 per cent. Women with higher education and more experience are 12.9 per cent more likely to enter into leadership positions and their pay is 21.2 per cent higher.

The research highlights the stark issue of women struggling to progress to leadership roles compared to their male counterparts.

Research by Harvard Business School (HBS) suggests that women excel and score higher than most men in leadership skills. Their analysis found that women outscored men on 17 of the 19 capabilities that differentiate excellent leaders from average to poor.

Despite this, women lack confidence when it comes to assessing their own skills, and are less likely to apply for jobs unless they are confident they meet the requirements, while men often assume they are more competent than they are, HBS finds.

This lack of confidence makes it more difficult for women in the workforce who are then less likely to self-promote and advocate for themselves in discussions around wages, promotion and career progression.

In the research, Prof Niessen-Ruenzi studied from a pool of adequately qualified women, showing that the issue is that women in the workforce are held to higher standards than men when it comes to filling leadership positions.

Prof Niessen-Ruenzi explains that observable skill signals are more important for female directors if the hiring decision is made only by men, and if a new CEO replacement is needed to fill the post immediately

He further explained: "Our results are also stronger for female directors entering a leadership position from outside the company, and for firms headquartered in states with conservative gender norms."

These results fit screening discrimination processes where women are needed to provide observable skills to employers as opposed to their unobservable qualifications which are harder to judge.

The research shows that as long as both women and men are held to different standards in the workforce, equally qualified women will be at a disadvantage as they are expected to display more evident skills than men to prove their worth.