Gender diversity and credit risk: analysing the 'glass cliff' theory
There is a tendency for women to succeed men in leadership positions when the firm is at high risk and the chances of success are low.
A new report from Henley Business School might give Dame Sharon White, the outgoing chair of the troubled John Lewis Partnership (JLP), pause for thought.
Her tenure has been mired in controversy, including a reported plan to end employee ownership, and mooting non-core activities such as building homes for rent above Waitrose stores. The retailer reported a loss of £234m last year, and White recently announced that its turnaround would be longer and more costly than planned. When she steps down in February, she will be the shortest-serving chair in JLP’s history, and analysts say her civil service background and lack of retail experience have not served the company well.
White could be seen as a victim of the ‘glass cliff theory’ – the tendency for women to succeed men in leadership positions when the firm is at high risk and the chances of success are low: White’s predecessor Sir Charlie Mayfield presided over a damaging management reorganisation. Women are often judged to be better than men at managing emotions and crises, and able to bring a more collaborative and inclusive leadership style during difficult times.