In last week’s issue I briefly discussed a study from the venture capital industry that found that decision-making groups that had a higher number of female senior venture capitalists offered less funding to women-led businesses than groups that included fewer female senior venture capitalists. In fact, every additional senior female venture capitalist in a firm’s decision-making group was linked to a 0.46% decline in the proportion of newly funded women-led businesses in its investment portfolio.

But the researchers found this phenomenon did not always persist. When a senior female venture capitalist had worked with a decision-making group before, and when there was a politically neutral senior venture capitalist in the group, this didn’t happen. The researchers therefore suggested that venture capital firms explore inviting outside female investment professionals to work as consultants to decision-making groups. The researchers believed that including independent senior female investment professionals would allow those women to advocate for women-led businesses without backlash from men within their own firms.

Of course, the venture capital industry is not the only male-dominated industry where it appears on the surface that women don’t support other women. Indeed, I recently came across a study [paywall] in the Academy of Management Journal that found that law firms with more women in senior leadership actually hire fewer female associates than law firms with fewer women at the top. Specifically, the researchers found that, for every nine women added to the senior leadership ranks at a law firm, the average number of positions offered to young women associates fell by one.

These results were depressing. If increasing women at the top of law firms decreases the number of women at the bottom of them, we certainly can’t fix the problem by decreasing the number of women in senior leadership at law firms. There are so few already! Is there an answer like the one discovered by the researchers in the related study from the venture capital industry? Let’s discuss.

The Study Results

The researchers in the Academy of Management Journal study analyzed the 250 largest law firms from 2007 to 2015 to study how often jobs were offered to women. They obtained data on the number of female partners and associates from the Vault/Minority Corporate Counsel Association’s annual U.S. Law Firm Diversity Survey, the “industry standard of demographic surveys of law firms.” p.10

The researchers then looked at whether associates accepted the offers they were extended. Even though previous studies had shown that junior women candidates are more likely to apply to jobs at firms with a higher proportion of women founders, a larger number of senior women at the top did not mean that more junior women candidates received offers. In fact, a one standard deviation change in women’s representation at the top (roughly nine senior women) on average decreased the firm’s expected number of job offers to junior women by one offer per season.

Extending a fewer number of offers to female associates is significant. On average, 41% of offers extended to both male and female entry-level professional were accepted. However, the researchers found that if a law firm went from extending 10 offers to women to extending 9 offers to women, the percentage of women who accepted the firm’s offer dropped to 35%. In short, even a slight reduction in the number of junior women entering the firm is likely to compound over time and result in a substantial cumulative long-term impact on gender diversity at the lower levels.

Why Having More Women Doesn’t Lead to Hiring More Women

Based on prior research, the researchers had some hypotheses regarding why the presence of more senior women at the top of law firms results in hiring fewer young women. Namely, they suspected that law firms with more women at the top think they’ve achieved gender equity, and therefore invest fewer efforts in attracting and retaining women at lower levels.

That law firms so easily rest on their laurels is dismaying given that even the law firms with a significant number of senior women at the top only have a significant number relative to their peers. As the researchers explain: “When it comes to diversity, men often evaluate their firm’s performance regarding gender representation goals by comparing it to other firms in the industry.” p.5 But having lots of senior women compared to your peers does not mean you have achieved anything close to gender equity. “Women remain significantly underrepresented in the highest-ranking influential positions, even in firms with relatively higher representation than peers” (p.5) and occupy less than 20% of the highest-paying C-suite roles and high-status partner positions in professional service firms.

To counteract the institutional tendency towards complacency, the researchers suggested that law firms should place women on DEI and hiring committees. They posited that doing so would force law firms to do more than just give lip service to their diversity objectives by giving women “the formal responsibility, assigned power, and authority to monitor the diversity and employment-related decisions of the firm.” p.8 Studies have shown that when women make up at least 20% of such committees, firms’ engagement with DEI efforts jumps significantly.

Giving women official positions also allows them to champion gender equity issues as part of their formal responsibilities, rather than taking time from revenue-increasing tasks to do so. It allows them to form coalitions and alliances to influence the firm’s diversity and hiring practices. It permits women to demonstrate their managerial capabilities. And the presence of women makes it more likely that men on such committees will remain committed to the firm’s diversity and hiring goals.

The equation, so to speak, for gender equity in a law firm thus has to look like this:

Concluding Thoughts

The researchers’ recommendation to include more women in hiring and diversity committees is akin to what the researchers recommended in the venture capital study referenced at the top of this article. If you throw more women into the decision-making process, women feel more empowered to make those decisions and, even in male-dominated workplaces, are less likely to defer to men in making them.

In essence, placing women into positions with real authority begins to make real change. If women are empowered within law firms, the pressure to evolve switches from external pressure from clients and the media to pressure from its women owners and employees. And, while external pressure can result in superficial changes, internal pressure results in change that is more transformational. As the researchers explain:

Thus, while it’s easy to see the results of the Academy of Management Journal study and draw the conclusion that the problem is that women don’t support other women, in male-dominated industries like the law, that conclusion doesn’t go nearly far enough. For the most part women do support each other—but only if they are in environments where they won’t experience adverse consequences for doing so. Women need to be given power and authority to make decisions that will result in real changes within their law firms.

So how do you know if your workplace is, in fact, such an environment? In next week’s issue, we’ll talk a little more about the characteristics shared by organizations that have the most success in advancing gender equity. Stay tuned!

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