Why business schools need more women at every level

The last few years have seen some notable milestones for business school gender equity – in particular, the Wharton School of the University of Pennsylvania naming Erika Hays James not only the first woman but also the first person of colour to serve as dean in 2020. In her own words that will resonate with many: “Gender is the least of what I have to offer.”

It is no secret that the higher education sector suffers from a lack of gender and racial diversity in relation to business school deans, although there has been a marked improvement over the past 10 years.

In addition to Erika Hays James, there have been:

• Francesca Cornelli – Northwestern’s Kellogg School of Management;

• Isabelle Bajeux-Besnainou – Carnegie Mellon’s Tepper School of Business;

• Marion Debruyne – Vlerick Business School, Belgium;

• Ann E Harrison – Berkeley’s Haas School of Business;

• Susan Hart – Durham University Business School;

• Helena Van Zyl – Free State University Business School;

• Yasmine Benamour – HEM Business School, Morocco;

• Fiona Devine – Alliance Manchester Business School;

• Ana Martins – University of KwaZulu-Natal Graduate School of Business and Leadership;

• Maryam Alavi – Georgia Tech’s Scheller College of Business;

• Karen Sedatole – Emory Goizueta Business School; and

• Barbara Stöttinger – Vienna University of Economics and Business.

By naming these women I not only wish to highlight their achievements but encourage those applying for business schools to pay attention to the leadership and philosophy of the illustrious schools to which they are applying and make decisions on entry accordingly.

A far greater achievement than James being made dean at Wharton was the fact that for the first time in its 140-year history, the school this year enrolled more women in its incoming MBA class than men.

Its MBA class of 2023 includes a record high of 52% women, making it the first of the seven elite business schools to have a class that consists of a majority of women, according to the Wall Street Journal.

“This landmark achievement demonstrates Wharton’s commitment to providing a diverse and representative community for our students,” James said in a statement. “As a female leader, I understand first-hand the significant impact that experiencing meaningful gender representation can have on women as they chart their careers.”

In James’s short tenure, the school’s numerous efforts to increase the representation of women is paying dividends. Efforts include its partnership with the Forté Foundation, a non-profit that works to increase women’s enrolment in business schools, fellowships for women students, and conferences and networking opportunities via student clubs like Wharton Women in Business.

Would this have been possible without James at the helm? Only time will tell if other ‘elite business schools’ can match and surpass female enrolment at Wharton.

Not the rule

Unfortunately, Wharton’s achievement is far from the norm and female-led business schools are not presently enrolling more female students than schools led by men.

Research from the Association to Advance Collegiate Schools of Business (AACSB) found that over the past five years, the number of business schools with female deans has crept upwards, from 17% in the 2007-08 academic year to 18.5% this year.

Executive MBAs (EMBAs) and undergraduate programmes at institutions with female leaders had proportionately fewer female students than schools led by men – 24.2% vs 29.9% for MBAs, and 40.7%. vs 42.2% for undergraduates.

Not only that, but MBA programmes at schools with female deans had only a slightly higher proportion of women students, at 38.6%, than schools with male deans at 35.3%.

Furthermore, 2018 data from the AACSB show that just one in four business school deans were female. Why does it matter? The reason is that the proportion of female business deans is a mirror of female CEOs in organisations internationally. The lack of female deans is a feature of the more general ‘glass ceiling’ and related issues which impact on women in general.

Much of this is in fact down to ‘pipeline’ numbers of women pursuing business education remaining low. While law and medical schools have nearly reached gender parity, MBA programmes admit only about 30% women annually.

Findings of a study from a decade ago, “Women and the MBA: Gateway to opportunity”, still hold true: “Women feel significantly less welcome than men in the business school environment and more often report difficulty having their point heard or perceptions that their point was altogether dismissed.”

Women MBAs also lack professional mentors and role models in the classroom where female faculty are a minority. A look at two top business schools – Columbia University and Stanford University – show percentages of female faculty at 17% and 19% respectively, according to the 2010 Financial Times.

Knock-on impact on industry

Underrepresentation within business schools and particularly in MBAs mean that to date women are still underrepresented in high-paying jobs in management. For example, a recent survey in the financial services sector found that while women represented 58% of human resources, 46% of marketing and 35% of legal executive roles, they held only 13% of technology, 17% of finance and 21% of operations executive roles.

Gender pay gaps arise because the management occupations with fewer women typically pay more, which is unsurprising when those educating and moulding the technology, finance and operations executives of the future are far more likely to be male.

The picture is even bleaker when it comes to the start-up ecosystem, with about a quarter of the 50 unicorn startups with the world’s highest valuations counting at least one MBA as a founder, according to data from BSchools.

With far more men than women studying an MBA this will, of course, tip the scales against women. Even more worrying when it comes to funding female-founded startups is the news that from January to August 2021, companies with only female founders raised just 2.2% of venture funding, as per Crunchbase data. That’s a lower share than in any of the previous five years.

Having written previously on gender equality – “It doesn't pay to be a female soothsayer, even in edtech” and “Why do so few edtech companies have female founders?” and about the impact of the Theranos scandal on female entrepreneurs, I can say that the present state of affairs in our global business schools worries me greatly.

Without female leaders and role models within higher education, what message are we sending to aspiring women of the future who wish to embrace academic and-or commercial leadership and entrepreneurship?

Return on investment

To remedy the present situation, the first task is to get more women studying at business schools. This will not only require effort but also evidence on the return on investment. While more data exists in this regard for business schools than the wider sector, when it comes to international students it is still sadly lacking, particularly for those who return home following their studies.

Having personally weighed up the benefits of an EMBA, no school could make the numbers stack up: the cost of the MBA and the time away from my fledgling startup and family vs the ‘imaginary’ return on such a significant investment.

Many schools wax lyrical about their number of Nobel Prize winners (all male) and the unicorns they have fostered (all male), but none could provide quantitative data regarding successful startups (that were not unicorns) fostered during and post their MBA programme and how studying an MBA made a tangible difference.

While it is important that we celebrate our female leaders, we also need to commit to foster female leaders of the future whatever their path, be it academic or in the world of business.

Louise Nicol is the founder and director of Asia Careers Group SDN BHD, an edtech company that tracks the graduate outcomes and career progression of international students globally.