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Debunking Four Myths That Hold Women Back In The Workplace And How To Overcome Them While Climbing The Corporate And M&A Ladder

Archana Gilravi, Joanna Jung-Erh Lin, Charlotte May, and Elizabeth Hattrup

Debunking Four Myths That Hold Women Back In The Workplace And How To Overcome Them While Climbing The Corporate And M&A Ladder Portelli

This article is a follow up to the presentation given at the Women in M&A Subcommittee Meeting at the American Bar Association’s Hybrid Mergers and Acquisitions Committee Meeting in January.

Women have long been stigmatized in the workplace as a “needier” gender with less ambition, focus and time for their careers. Despite the progress made in recent decades, these outdated beliefs are consistently hindering a woman’s career path in corporate America. However, studies like the Women in the Workplace report conducted by McKinsey & Company and LeanIn.Org (the “Study”) work to debunk the myths surrounding the “working woman” today and provide tools and solutions for companies to better advocate and promote women who are climbing up the corporate ladder, including those working up the chain in M&A, a predominately male driven arena. For the purposes of this article, we will also reference the survey of law firms in North America conducted by The Women in M&A Subcommittee of the American Bar Association, as of December 2022 (the “Survey”).  The Survey was comprised of 28 law firms, representing over 23,700 lawyers and over 3,100 M&A lawyers. The references to statistics in this article are from either the Study or the Survey unless otherwise indicated.

According to the Study, although women hold 48% of all entry level jobs (18% of which are women of color), women hold only 28% of all c-suite positions. The drop in representation begins at the manager and director level creating a “weak middle in the pipeline” and causing a domino effect up the chain of command. In addition to the general drop in representation for women, women of color are even further behind with representation lower than that of white women and men of the same race and ethnicity. In the legal world, the drop in representation is no different. Though 53% of all lawyers entering law firms as a first/second year associate are women, only 23% of law firm senior equity partners (six years or above) are women and only 19% of senior equity partners in M&A are women, based on the Survey.

The Study, which is the largest study on the state of women in corporate America, researched four myths commonly found in the workplace, the first of which is that “women are becoming less ambitious.” The Study, however, shows otherwise. Corporate America’s transition into a more flexible work environment in the aftermath of the pandemic has prompted women to pursue their ambitions more than ever. In fact, 81% of women are interested in being promoted to the next level (equal to the 81% of their male counterparts) and 96% of women view career as important (also equal to the 96% of their male counterparts). In particular, according to the Survey, the percentage of women in M&A increased 4% from 32% in 2020 to 36% in 2022: the largest increase in any two-year period, potentially showing the impact of remote work during the pandemic.

The second myth that the Study addressed is that “the biggest barrier to women’s advancement is the ‘glass ceiling’.” However, rather than the “glass ceiling,” the Study shows that the “broken rung” in the ladder is the greatest obstacle faced by women in their climb to senior leadership. Specifically, the first promotion from an entry level role to a manager position shows a 13% gap between men and women and a 27% gap between women of color and men. As women fall behind in the beginning of their careers due to a lack of promotions, it becomes harder and harder for them to catch up and make it to the c-suites. Based on results from the Survey, women entering law firms as a first/second year M&A associate starts at 48% but steadily decreases to 19% when measured at the rank of senior (six years or above) equity M&A partner. Despite women representing 44% of senior (six years or above) M&A associates, women only make up 33% of non-equity M&A partners, 25% of equity (5 years and below) partners, 19% of senior (six years or above) equity partners and 35% of other senior M&A lawyer roles (of counsel/special counsel). This represents a large gap in the promotion of women in M&A from associate to more senior roles.

For M&A transactions, this emphasizes the continuing importance for senior lawyers to make a conscious effort of staffing their deal teams with a diverse group of individuals. By staffing diverse deal teams, each member will gain more experience and have more proven successes under their belt when it comes the time for promotion. Further, they will have more opportunities to interact with other senior lawyers at the firm as well as clients. As the legal field does not necessarily have true “promotions” until the promotion from associate to partner or other senior lawyer role, it is critical that diverse candidates be staffed on deals and given more responsibility so they have the tools needed to lead deals and maintain and build client relationships, which are key attributes looked at when being considered for promotion to partner or another senior lawyer role. By staffing women under strong female leadership and male advocates, women will have a better chance of being recognized and valued for their work. This does not end following promotion to partner or another senior lawyer role. It is important for firms to take an active role in helping newly promoted women be successful at the firm, including with client relationships and development and opportunities. For example, a study completed by UC Irvine Law revealed that despite women making up 20% of equity partners at large law firms, they only accounted for approximately 10.5%, on average, of lead counsel positions for buyers on larger M&A deals between 2014-2020. It is critical that women have the opportunity to run the larger deals that come down the pipeline.

The third myth the Study reviewed is that “microaggressions have a ‘micro’ impact” when in reality microaggressions have a “large and lasting impact on women.” It is no secret that women face significantly higher levels of microaggressions in the workplace than their male counterparts. Sadly, even women who have made it to the c-suite or partner level, are twice as likely to be interrupted during a conversation. These microaggressions cause women to “self-shield” themselves often times causing them to blend in more and holdback their voices which ultimately hinders their visibility for promotion. Further, due to microaggressions, women often times overly exert their friendliness in an attempt to not be labeled as “difficult” in fear that voicing their opinions and being aggressive will hinder their path to success as well.

With respect to the microaggressions faced by women in M&A, it is no secret that they too fall victim to being interrupted on calls, introduced as associates despite their partner title, asked to do the administrative tasks, and overlooked when invitations for networking events go out. It is imperative that lawyers (women and men) who are at the partner and senior level shut down these microaggressions in real time in order to set the tone that actions like those mentioned above are unacceptable and will not be tolerated. This can be done in a number of ways, including, but not limited to, giving credit to women colleagues for accomplishments or ideas they had that were either unrecognized, ignored or credited to someone else and ensuring that the entire deal team is recognized in any articles or announcements that may be made about the deal.

Finally, the fourth myth addressed by the Study is that it is “mostly women who want and benefit from flexible work” when data shows that both “men and women see flexibility as a ‘top 3’ employee benefit and critical to their company’s success.” With the rise in work from home opportunities and flexible work hours driven by the pandemic, both men and women agree that the opportunities to work remotely and have control over their schedules is a top benefit offered by companies which is second only to healthcare benefits. The counter argument that on-site work benefits employees by providing a strong organizational culture was also debunked as only 34-39% of men and women agree that on-site working makes them feel more connected to the company’s culture. On-site work also disproportionately benefits men as they are more likely to receive the mentorship and recognition for their accomplishments in person.

Regardless of the reasons why someone is working remotely, if the pandemic proved anything, it is that a good majority of the new workforce prefers the flexibility of working remotely. It is important that as firms transition back to a more in-person work model, that lawyers use the in-office time effectively, including holding meetings in-person, having lunches or coffee in person, etc., and ensuring that women and diverse lawyers are not overlooked for these opportunities. The Study further shows that remote working can reduce the chances of burnout, which can be prevalent in M&A roles.

Overall, companies and firms alike can work towards a more equal work environment by using data to track their progress. Tracking outcomes, and specifically tracking the company’s progress in promoting diversity, equity and inclusion, is “critical to any successful business initiative” according to the Study. Supporting and rewarding managers who work towards promoting diversity and inclusion is also a way for companies to continue to promote a work culture that gives equal opportunities for success regardless of gender, race, affiliation or physical and mental ability. Consistent training and availability of resources to managers to assist in fostering a healthy and diverse environment in the workplace is also critical for the success of a company’s overall culture.

In terms of promoting and retaining women, firms should actively work towards encouraging partner and senior level lawyers to work with diverse and younger associates to assist them in navigating a career that is still predominately driven by white men. Setting an example by shutting down microaggressions in the workplace and asserting respect on client calls and negotiations will foster a future where fewer women are “self-shielding” their voices to avoid being labeled as a difficult team member. Further, through mentorship and data tracking, firms can better support the promotion and retention of women and women of color by tracking the year’s successes and being equipped with the right data to support the promotion of women to partner level roles. We hope that this data will help remind those in the practice of M&A that the promotion and retention of women in the field requires an ongoing effort on everyone’s part. At first glance this could appear to be an issue that is improving; however, each of the prior Surveys dating back to 2014, and the prior Studies dating back to 2015 show that these trends have unfortunately remained relatively stable.