Executive Women Making Progress Closing Pay Gap

While there is still a ways to go women have come a long way in the C-suite and the pay gap also appears to be making solid progress. A new report from ON Partners confirms executive women’s compensation climbs to an average of $452K. Let’s hear what the firm found in its 2024 Women’s Report!

April 18, 2024 – Last month, ON Partners released its 2024 Women’s Report in recognition of Women’s History Month. The report revealed a positive trend as the gender pay gap is narrowing year-over-year (YoY), with executive women earning an average of $452K, compared to executive men’s average of $461K. In addition, when isolating director and vice president roles as a pipeline of future C-suite executives, women are leading in average total compensation. McKinsey Women in the Workplace report from 2023 highlighted the strides made in women’s representation in senior roles.

Since 2015, there has been a remarkable surge of women in C-suite and senior VP positions. While women still face underrepresentation across the corporate pipeline, the number of women in the C-suite has increased from 17 to 28 percent. This encouraging trend is also mirrored in the enhanced representation of women at the VP and senior VP levels.

Over the past nine years, women—and especially women of color—have remained underrepresented across the corporate pipeline. However, McKinsey found a growing bright spot in senior leadership. Since 2015, the number of women in the C-suite has increased from 17 to 28 percent, and the representation of women at the vice president and senior vice president levels has also improved significantly.

“The COVID period when companies were recruiting remotely and more accepting of remote executives was a turning point for female supply chain executives, particularly those in procurement,” said Heidi Hoffman, partner at ON Partners.  “I have also not seen that female supply chain executives make less money than their male counterparts.  The compensation levels for all these executives have been rising tremendously as the role moves into the C-suite and takes on a more strategic position.” 

“Additionally, I have seen an increased number of female entrepreneurs in the supply chain, identifying long-standing issues and building technology-driven solutions to solve them,” Ms. Hoffman said. 

Related: The Business Case for Gender-Inclusive Leadership Teams

However, in the life sciences and healthcare sector, ON partner Suzanne Zebedee confirmed that women candidates for early-stage C-suite roles currently face limited leadership role opportunities. “The executive positions where we look to source and recruit first-time CEOs are COO, CCO, and CBO roles,” she said. “It would be great to have more women gaining experience in these C-level roles as a pathway to increase women executive leaders and women CEOs in the industry.” 

Combating the Gender Gap

As companies navigate challenges and opportunities associated with hiring for executive leadership roles, total compensation packages are a strong focus in combating the gender gap within the workforce. On average, ON data found that executive men secured a bigger bonus and equity payout in 2023. This resulted in men obtaining an average sign-on bonus of $143K and women of $129K. As it pertained to average base salaries, executive women negotiated a higher base pay.  This data suggests that women are placing more emphasis on immediate salary compensation benefits. 

Tempting Talent Reveals Wide Gender Pay Gap Across U.S. Executive Search Sector
Tempting Talent’s USA Executive Search & Recruitment Compensation Report revealed a gender pay gap of up to 41 percent across the U.S. executive search and recruitment industry. The aim of the report, said the consultancy, is to make the industry more transparent and help business owners by offering insights into issues like gender pay gaps, average compensation and market saturation. The findings will come as a concern for the industry, particularly for experienced staff, as respondents with over 11 years of tenure face a pay gap of 41 percent between men and women professionals. There is also a gap for those just entering the sector, as findings uncovered respondents with under five years of experience are subject to a 12 percent pay gap.

In looking at figures for gender and base salaries in executive search and contingent recruitment across the U.S., Tempting Talent found an overall gap of 15 percent. The average compensation for males was $106,411, compared to just $90,063 for females. This, said Tempting Talent, was only an average and did not provide a holistic insight into the entire industry.

“Oftentimes, there is too much of an emphasis on first year’s cash during hiring negotiations that executive candidates lose sight of the long game and important components of the total package, including long-term incentives and equity,” said Tara Flickinger, partner at ON Partners. 

The 2024 Gender Pay Gap Report by Payscale provided additional insight into the variation of wages.  Women earn 83 cents on the dollar compared to men, with executives facing an even wider gap at 72 cents. However, overall gender pay gap remains unchanged despite the strides made in pay transparency legislation this year – but there has been progress on narrowing the racial wage gap.

“While the gender pay gap has not closed since introducing pay transparency legislation, the gap is narrowing and is starting to close for certain segments and locations,” said Ruth Thomas, pay equity strategist at Payscale. “Looking ahead, organizations need to remain focused on pay equity as a central pillar to compensation management, as well as diversity, equity, inclusion, and belonging (DEIB) practices. Fair pay doesn’t just happen. Employers need to proactively create equitable opportunities and measure equitable outcomes.”

Related: Want Higher Profits? Put a Woman in the Top Job

In addition, women were found to be more likely to stay in individual contributor roles longer than their male counterparts.  However, ON data shows that in the last ten years, executive women have consistently changed jobs faster than men.  Also, in the previous few years, men have increased their tenure in a role while women remain consistent in switching jobs on average every 2.4 years.  

“As non-conformists in the executive hiring domain, ON Partners seeks to bring transparency and clarity to the ongoing dialogue surrounding compensation parity at the executive level,” the search firm said.

With a primary focus on technology, consumer, industrial, and the life science sectors, ON Partners recruits C-level and board talent for public and private companies, as well as venture capital and private equity firms. Founded in 2006, the firm’s consultants work from offices in Atlanta; Boston; Chicago; Cleveland; Dallas; Menlo Park, CA; Minneapolis. MN; San Francisco; and New York.

Top Women Recruiters

Ms. Hoffman is partner and leader of the supply chain practice. Considered a pioneer in the recruitment of senior supply chain executives, she specializes in the recruitment and development of senior executives in strategic sourcing, procurement, manufacturing, operations, logistics, distribution, customer service, planning, quality, engineering and operational excellence for industrial, consumer, retail, life sciences, and technology companies globally. Before joining ON Partners Ms. Hoffman led North American supply chain center of expertise at Korn Ferry and founded and led the global supply chain practice at Russell Reynolds, where she also headed the North American industrial sector.

Dr. Zebedee has devoted more than 20 years to executive search with a focus on the life sciences, specializing in biotechnology, diagnostics, research tools, and pharmaceuticals sectors of healthcare. Functions she has served include C-level and top-level research, development and commercial executives for public, private, and VC-backed organizations. An executive committee member at ON Partners, Dr. Zebedee has served as senior client partner and co-leader of the biotechnology practice at Korn Ferry, vice president of business development for two venture-backed companies and held research positions at the R.W. Johnson Pharmaceutical Research Institute, Pharmacia, and SIBIA.

Ms. Flickinger focuses on C-level executives across functions in private equity/venture capital, consumer technology, and industrial/manufacturing. She places C-level executives across functions, including sales, marketing, operations, technology, and human resources. Based in the ON Partners’ Atlanta office, Ms. Flickinger works closely with clients to understand their hiring needs and to ensure an efficient search process, said the firm.

Related: The Case for Promoting Women

Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Executive Editor; Lily Fauver, Senior Editor – Hunt Scanlon Media

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