Why Family Businesses Will Lead the Way in Breaking the Glass Ceiling

Family-owned companies are already blazing new trails when it comes to women's leadership, says expert Rochelle Clarke. What makes them so smart?

Rochelle Clarke By Rochelle Clarke

What is the glass ceiling? The Department of Labor defines it as an "unseen, yet unbreachable barrier." (Credit: Patrick Baum on Unsplash)

What is the glass ceiling? The Department of Labor defines it as an “unseen, yet unbreachable barrier.” (Credit: Patrick Baum on Unsplash)

For decades, the term “glass ceiling” has invoked far more than thoughts of sunlight and architecture. In 1995, a select commission of the U.S. Department of Labor provided an eloquent glass ceiling definition: “the unseen, yet unbreachable barrier that keeps minorities and women from rising to the upper rungs of the corporate ladder, regardless of their qualifications or achievements.”

In the corporate world, the glass ceiling seems as strong as ever. Only 5 percent of the CEOs at Fortune 500 companies, for example, are women. As telling as this stat is, however, it overlooks a potential bright spot in an otherwise gloomy landscape: There is a significant difference between how family businesses value women in comparison with their corporate peers.

[Related: The Especially Thick Glass Ceiling of the Tech World]

In a 2014 survey of 525 of the largest, oldest family businesses in the world, researchers found that each one averaged five women in the C-suite, with four being actively groomed for top executive spots. Some 55 percent had at least one woman on the board of directors, and 70% of them were considering a woman to serve as the next CEO.

Family businesses have clearly discovered and benefited immensely from women in top leadership. Why are family-owned companies blazing the trail when it comes to more gender-inclusive leadership environment? The answer to that question involves 3 factors:

1. Gender-Blind Survival

When family businesses limit their pool of available successors to a small circle of close relatives, they forfeit the luxury of “seeing gender.” Instead, they see family. It’s not about men vs. women; it’s about what’s best for the family and its legacy. In that sort of environment, top-performing women are much less likely to be passed over in favor of less qualified men.

2. Promotion From Within

With a limited pool of successors, family businesses are forced to draw out and develop every potential successor’s strengths, regardless of gender. From an early age, each one is trained to become a jack or a jill of all trades so that they can one day take the reins. This puts women on a more equal footing than if the company expanded its circle of talent to outside the family.

[Related: Deciding to Join the Family Business. Sort of.]

3. Diversity Begets Diversity

As women take up residence in the C-suite, diversity of outlook and opinion inevitably follows. That diversity can’t help but multiply itself. Since family businesses have emerged as an early adopter in this arena, they’re well disposed to benefit from this “snowball” of gender diversity.

What Any Company Can Learn From Family Businesses

If non-family-owned businesses are interested in benefitting from the inclusion of women in corporate leadership, then they should take a cue from their family-owned counterparts. The following 3 tips will help any organization cultivate and empower its women to lead their company into the next generation:

1. Focus on Survival

This may seem obvious, but it merits emphasis. Organizations should choose successors purely on the strength of their performance and not on the basis of their gender. Especially when we’re seeing more and more women succeed in leadership, organizations cannot afford to overlook top performing women for the sake of mediocre men. For many, this will require an intentional and systematic checking of one’s implicit biases against members of the opposite sex.

[Related: Listen to our podcast about successful women entrepreneurs.]

2. Promote From Within

When family-owned businesses like Enterprise make promotion from within a priority, they create a valuable “people pipeline” that becomes the life’s blood of the organization. The quality of such a pipeline depends heavily on training both men and women to perform at their highest level. More importantly, with respect to women, this creates an environment in which they receive the same opportunities to climb the ladder as their male counterparts.

3. Welcome Diversity

Don’t just invite “others” to sit down at the table; encourage them to speak as well. When differing patterns of thought intersect with tried and true wisdom, innovative new possibilities will inevitably emerge that can only lead to progress, not just for women, but for the organization itself.

As we’ve seen, family businesses have the potential to lead the way in empowering women to serve at the highest corporate levels. Even so, it would be a mistake to hold them all up as some of utopian ideal. Across the board, we still have a long way to go towards creating true equality of opportunities for women at every level. Thankfully, there are family businesses out there who are willing to lead the way.

Rochelle Clarke is the founder of Succession Strength, a firm that helps family businesses identify and overcome transition hurdles. She is also the author of the new book, The 5 Critical Succession Conversations, A Comprehensive Guide for the Family Business.

Posted: November 26, 2018

Rochelle ClarkeWhy Family Businesses Will Lead the Way in Breaking the Glass Ceiling