Let’s Commit to Achieving Gender Parity in MBA Programs

It's time for business schools to focus on jobs, not admissions.

Let’s Commit to Achieving Gender Parity in MBA Programs
WHILE MOST BUSINESS SCHOOLS CLAIM to be aiming for full gender parity in their classrooms, women currently account for only about a third of students in top international MBA programs. HEC Paris, for instance, has 35 percent women. However, as I see it, the biggest problem for female business students is not the lack of gender parity within their cohorts, but the persistent wage gap they will endure when they rejoin the workforce.

I believe that, instead of trying to increase the percentage of women enrolled in their programs, schools should focus on offering equal career opportunities to male and female graduates. Indeed, if post-MBA salaries and career opportunities were the same for men and women, business schools would achieve gender parity as a market-driven consequence and in a way that would benefit both women and schools.

Now, there’s only so much business schools can do to improve parity in the workforce. But we can make sure we support our female students while they’re on our campuses, we can partner with firms that are committed to gender parity—and we can start acknowledging that a problem exists.

THE WAGE GAP

Let’s take a closer look at the numbers. In Bloomberg Businessweek’s biennial ranking of MBA programs, women graduating in 2014 reported average annual salaries that were significantly lower than the salaries of their male counterparts. (For details, see www.businessweek.com/features/bestbschools-2014/.)

Some industry observers attempt to explain away these figures by noting that women tend to go into fields that pay less, such as advertising or consumer products. However, a quick study of the Businessweek report refutes that argument. The wage gap makes an unwelcome appearance even when it comes to the starting salaries of men and women working in the same industries. The women who are going into finance, consulting, and tech fields—often male-dominated and better-paid industries—also report systematically lower wages.

Other observers maintain that, no matter what industry they are in, women earn less on average because they choose to interrupt their careers to have and care for children. But the evidence doesn’t support this argument, either. At graduation, most women have not started families yet, so they should be on an equal footing with men. But even when they have exactly the same degrees, jobs, and experience levels as their male counterparts, they earn less money. Even female career switchers who have the same lack of experience in their target industry as men do make less money than those men.

Therefore, wage discrepancies cannot be glossed over by pointing to choices related to careers and families. Perhaps women are being effectively penalized, or even discriminated against, because employers believe they have the potential to disrupt their careers for family reasons. Or perhaps, in order to accommodate other demands on their time, women accept lower-paid jobs because they offer more flexibility.

The causes may not be simple. But I believe business schools have an obligation to try to change the equation. To do so, they should take three key actions:

1. CHANGE THE RANKING SYSTEM. Business schools that actually achieve full gender parity will pay a cost: If they have more female graduates, and those graduates make lower average salaries, the school’s rankings and reputations could suffer. Why? Because in many rankings, post-MBA income levels play an integral role.

I have a radical idea for addressing this issue: Business schools could urge ranking agencies to consider adjusting post-MBA salary averages to account for the percentage of women graduates. The rankings could give women’s salaries a proportional uplift to reflect what their male colleagues in the same positions are earning.

I realize this notion could be controversial, but it isn’t unprecedented. For example, in its Global MBA rankings, The Financial Times adjusts salary averages based on job sector distribution, inflating salaries for schools that place greater numbers of graduates in industries that offer comparatively lower compensation levels. In the same vein, they also convert salary numbers into

U.S. dollars, using IMF purchasing power parity rates. This helps them account for discrepancies that would negatively affect schools that place larger numbers of graduates in countries with weaker currencies. A similar system could be instituted to account for male-female wage discrepancies.

2. ABANDON THE FOCUS ON ADMISSIONS. For too long, schools have relied on a “bottom-up” approach of trying to admit more women and hoping they will achieve high-level careers. This strategy is dangerous for a couple of reasons. First, it might lead schools to consider introducing quotas for female students and being more lenient with them during the admissions process. But paradoxically, this kind of positive discrimination ultimately detracts from the cause of equality, especially when it comes to salary. The key objective of an MBA program is to help graduates get great jobs, not to check boxes about student demographics.

Second, this strategy reinforces the notion that our only challenge is to attract more women, which implies that an MBA is the proverbial golden ticket that leads to equally great jobs for men and women. And that’s as misleading as it is untrue. While the factors underlying gender inequity are complex, one important way that we can increase the number of women attending graduate business programs is to take steps to assure that women attain better-paying jobs at higher levels within their organizations.

3. STRENGTHEN THE FOCUS ON CAREERS. I see three ways schools can help women reach better positions and salaries:

They can create an empowering on-campus environment. As the business school student population is predominantly male, it’s important to support the women who are currently enrolled in MBA programs. One tactic to consider is having alumnae visit the campus as role models and speakers. At HEC Paris, we have HEC au féminin, a lobby of alumnae who hold conferences and award prizes for the most successful female graduates. We also have the Women in Leadership Club, whose members strive to inspire and empower the women MBAs on our campus, as well as to connect them with business leaders, industry-specific professionals, and alumnae. The Women in Leadership Club also engages male participants in issues pertaining to gender diversity and work-life balance.

They can offer more guidance during the job search. Schools could partner with companies to match women with lucrative jobs. For example, most leading consulting firms are keen to get more women on board, so they have programs designed to help women make it to the partner level. McKinsey & Company offers training programs for women at every tenure level, as well as women-only programs such as the Path to Partnership Workshop and Engaging with Presence. By collaborating with firms that have a dedicated interest in helping women, schools could channel their female graduates into fulfilling careers.

They can teach women how to negotiate. Research shows that a key but often overlooked reason for the persistent wage gap is that women are much more reticent about negotiating salary offers than men are. One study reported that only one-eighth of female graduating MBAs negotiated their offers, compared to half of the men. What’s more, according to a 2014 article from Harvard Business Review (hbr.org/2014/06/why-women-dont-negotiate-theirjob-offers/), women who do negotiate often have to deal with a certain level of backlash from potential employers. If business schools truly want women to earn equal pay, they should develop salary negotiating workshops as integral offerings in their career services offices

Ultimately, business schools can only do so much to help tackle the conscious and unconscious biases that lead to gender disparity and wage inequality. Yet by providing a supportive on-campus environment and helping women find the right job opportunities, business schools can provide a strong foundation for a new generation of top-level female managers.
Bernard Garrette is former dean of the MBA program and current professor of strategy and business policy at HEC Paris in France.