Women in senior management have more negotiation power than they think in today's labor market, says research by Paul Healy and Boris Groysberg. Is it time for more women to seek better opportunities and bigger pay?
Pressure to increase gender diversity in C-suites is so intense that companies are trying to draw women candidates with higher salary offers, a phenomenon that is closing the gender pay gap among senior executives, research shows.
Female executives still don’t earn as much as their male counterparts, but a woman in a senior leadership role who switches to a new firm can now expect a salary bump of 25 percent on average, whereas a man making a similar move will see 9 percent more pay, says Paul Healy, the James R. Williston Professor of Business Administration at Harvard Business School.
A search firm executive who was interviewed as part of Healy’s research explained how eager companies are to recruit women to their upper ranks: “Virtually all of my clients [looking to fill a senior role] will go out of their way to include a woman on the short list,” the executive said. “… If a woman is not initially interested in a role because it is not quite big enough or broad enough for her, they’ll often say, ‘OK, OK. You can have this other division of the company as well.’ … They will absolutely happily pay more for women. There is just such a strong push and momentum behind bringing women onto the exec team.”
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This article was provided with permission from Harvard Business School Working Knowledge.