Abstract
In 1998, Fortune Magazine ranked the 50 Most Powerful Women in Business. Only two were CEOs. The rest either led divisions within larger corporations or held senior staff positions, such as vice-presidents of human resources, marketing, or general counsel. Fast forward to 2012. The list now featured several women CEOs, many of whom were leading America’s largest companies, such as Hewlett Packard (Meg Whitman), DuPont (Ellen Kullman), and Yahoo (Marissa Mayer). Number seven was Xerox’s Ursula Burns, who was also African American. The new top-ranked woman was Virginia Rometti, IBM’s chief executive. Rometti’s elevation to the pinnacle of one of the largest and best known global corporations in the world was, if measured by the number of stories in leading newspapers and business magazines, an important but not earth-shattering event.
Flash back to 1972 when Katharine Graham became the first woman to lead a Fortune 500 firm. Graham had taken over The Washington Post following the suicide of her husband Philip, who had been the CEO since Graham’s own father retired from the position. For many years, Graham’s rise to corporate power seemed to be one of those unique historical moments when a woman comes to power as a result of her relationship(s) to a powerful man, not the harbinger of a new age. Indeed, between the 1970s and 1990s the backgrounds of the chief executive officers of American corporations were pretty similar to what C. Wright Mills described in the 1950s: they were almost exclusively white, male, and Christian (mostly Protestant).
In the late 1990s however, the rulers of corporate America underwent a subtle change. It first began in corporate boardrooms. Private activist groups, many of which emerged after the Civil Rights and Women’s Rights movements of the 1960s and 1970s, publicly called on America’s chief executives for greater representation in corporate boardrooms. This pressure led to a perceptible increase in the number of women, blacks, and Latinos appointed to corporate boards in the Fortune 500 firms. By the late 1990s, women represented almost 14 percent of corporate directors, up from about 1 percent in the 1970s. The number of blacks on boards increased to around 8 percent of the total. Then by the start of the new millennium, another subtle but discernible shift occurred at the chief executive level. For the first time the absolute number of women, blacks, Asians, and Latinos leading large corporations increased. White-shoe firms like American Express and Merrill Lynch appointed African American CEOs. Kellogg and Alcoa appointed Latino CEOs, while well-known firms like Avon, Yahoo, and Gateway appointed Asian Americans to the top post. Between 1999 and 2005, nine women became CEOs of Fortune 500 firms. And while their absolute numbers remain alarmingly small relative to their representation in the workforce, the reality is that these numbers have grown from what had been for most of American history close to zero. Richard Zweigenhaft and William Domhoff document the nature of this millennial shift, the paths to power of this new breed of CEOs, and the subsequent stall in the growth of this group in their excellent book, The New CEOs.
Studying corporate elites is conceptually and empirically challenging, especially when trying to discern trends with small numbers and the fact that most elites do not like to be studied. As a result, too many elite studies are either theoretically provocative but empirically weak, or have interesting descriptive statistics but offer little in the way of explanation. In sum, understanding the nature of American corporate elites and how they are selected is a complex subject whose investigation usually meets with mixed results.
Zweigenhaft and Domhoff have done a meticulous job working with a small data set, comparing the career paths of this group with a larger sample of business leaders, generating hypotheses based on a careful analysis of field and archival data, and constructing a novel sociological model of careers for members of these groups. The book builds on the authors’ earlier works on diversity among elites and the combined results are fascinating, the sociological processes even more so. I will elaborate on two.
One mechanism that has contributed to the initial increase and present stall is what the authors call the irony of diversity. The irony rests upon (1) a critical mass of visible or symbolic improvements that inevitably stall further progress; and (2) the fact that people—regardless of their background—come to relish the power and influence of structural privileges.
Recognizing that diversity has multiple dimensions and social meanings, the authors point out that increased diversity in executive suites and boardrooms is a direct consequence of social movements. However, with the increased visibility of diverse candidates in the executive suites, social forces that stall growth quickly emerge. Both progressive and reactionary forces declare victory, arguing that the advances demonstrate that meritocracy has finally prevailed. Reactionary forces recognize that declaring victory can kill momentum, thereby allowing the traditional forces of the status quo to reassert themselves. Progressive forces, especially after years of effort and work, want to celebrate their success. As a result, “good enough” plateaus are reached and the system tends to stabilize around a new equilibrium that sustains just enough diversity to oppose more systemic interventions in the labor market. Zweigenhaft and Domhoff point out that real social change is difficult. It takes years and has to be deeply rooted in society’s institutions. Until the basic culture and the systemic relationships between power and privilege are changed, the underlying mechanisms that reproduce durable inequality remain intact. Leaders of social change must go into the process recognizing that their efforts will take years and that change will perhaps not even be achieved in their lifetimes.
Another irony of diversity emerges from the experience of individuals who were once excluded, have achieved privileged positions, and now seek to transmit their advantages to their offspring. The result is a combination of co-optation and serial elitism that is often perpetuated through allocation systems like higher education, which is now the key mechanism of transmitting privilege from one generation to the next. The New York Times‘ Chrysta Freeland captured this impulse in an unusually candid remark in a 2012 interview with Ruth Simmons, then President of Brown University. Simmons was the first African American to lead an Ivy League university and also had served on the boards of Texas Instruments, Pfizer, and Goldman Sachs. In a discussion about the growing gap between the rich and the poor, Freeland asked Simmons whether legacy admissions should be abandoned. Simmons’ response was: “No, I have a granddaughter. It’s not time yet.” So much for the idea that underrepresented groups represent uncorrupted alternatives to traditional leaders, and having once been excluded are now less vulnerable to the temptations of power and privilege. Simmons’ comment supports the authors’ assertion that once an individual attains advantages, they are reluctant to give them up. This is especially true if further systematic change has not occurred and the only way to provide security for the people one cares about is to take advantage of the system rather than to engage in long, arduous efforts to bring about change.
What would real change mean? This brings us to the second set of key ideas put forth by Zweigenhaft and Domhoff. For those who care about ensuring meritocracy within a healthy democracy, the authors point out that sociologists need to think about mechanisms that might prevent the perpetuation in leadership of a small group of people or their immediate offspring. What this means in practice is curbing the ability of an individual to turn the advantages he or she has achieved into wealth, social status, and other social perquisites that perpetuate privilege. It is a society’s ability to prevent accumulated power from spilling over into the next generation through capturing credentialing systems and early systems of occupational allocations that ensures the health of a dynamic social system characterized by merit and social mobility. At a time when inequality in the United States has never been higher and the political implications never more discussed, the authors’ theoretical insights are fresh and original and their findings are timely and important.