The top ranks of China’s political leadership have always been bereft of female representation, and the latest list of Central Committee members is no different. Only 30 of the 362 are women, while the top body, the Politburo, has none at all. Things are slightly better on the business leadership side, but women still face many barriers to advancement.

There is recognition of a need for change in businesses across the world, and in China, there is a new generation of women aspiring to executive roles, inheriting family businesses or building their entrepreneurial ventures. However, changing ingrained social attitudes and speeding up the rate of change is a difficult process.

“It has improved a lot over the past 20-plus years,” says Yu Xuan Chen, Operations Manager at Shanghai Rhoden Rubber, an automation machinery manufacturer. “People are less shocked at a woman leading, they are respecting it and it has become more normal to have women in leadership roles. There are still comments occasionally, but they are less frequent.”

Uneven surface

While women have a 62% participation rate in the labor force as a whole, just 19% of executive roles in China were held by women in 2021, according to a Bain/Spencer Stuart analysis, somewhat less than the 26% in the UK and 24% in the US. Of this 19%, the majority hold positions in functional leadership roles, such as HR, Legal or Compliance, rather than at the CEO or VP level.

In China, women hold only 19.7% of board seats, 6.7% of board chairs and 5% of CEO and 15.7% of CFO positions, according to the UN. In 2022, just 41 of the 601 Chinese companies on the MSCI ACWI index had female CEOs, although those in that position did receive higher average salaries than their male counterparts, a generally unusual occurrence globally. As for presence on boards, in 2023 the updated MSCI list of 669 companies included 146 that had no women in any board seat.

The COVID-19 pandemic also hurt women’s advancement in the workplace. “Both during the pandemic and during the recovery period, different groups suffered different impacts, but one of the most concerning was the female population,” says Zhang Xiaomeng, Associate Professor of Organizational Behavior at CKGSB. “The UN made the judgment that the pandemic would set back the process of gender equality by 25 years.”

Leadership advantage

The power structure in China has always been top-down, and the fact that the country’s political system is behind the curve in including women is also a hindrance to the advancement of women into leadership roles within the business sphere. That said, although the vast majority of the private companies that helped create modern China were set up by men, many of those now inheriting the management roles are their daughters or granddaughters.

Increased representation of women in executive teams is an important lever for value creation in companies, and with this improved representation, they can expect to see a number of market benefits.

According to an Australian study of more than 11,000 private enterprises by the Bankwest Curtin Economics Center, with just a 10% increase in women’s representation in key management roles, a company can expect to see a 5.8% rise in the chance of outperforming sector averages, while the move to a female CEO leads to a 12.9% chance of outperformance. The same two changes also lead to a respective 6.6% and 5% increase in market value.

“In China in particular, the different perspectives women bring are broader than just social ideas, there is a lot of technical knowledge as well,” says the Managing Director of a European IT firm in China, who wished to remain anonymous. “I also think the cultural base of a desire for success and earning good money means that women here are particularly driven.”

Persistent problems

China is still a long way away from gender parity, with cultural factors that play a role in female leadership numbers across the world are similarly present in the country. A key issue is the notion that “men lead outside and women lead inside,” emphasizing the role of women in the household, rather than in business.

“I have only ever seen female leaders that either had no children or had a substantial support network of nannies or family members that took care of the children. The idea of the husband taking care of children is still very uncommon,” says the Managing Director.

For Yu Xuan Chen, who now runs her family business, this sort of thought process was also abundantly clear in early visits to the company. “It was very obvious when people would refer to my younger brother as the ‘little general manager,’ despite my sister and I being the older siblings,” she says. “There were also comments about the need for my family to have three children, because of the need for a son to take over the business.”

Unconscious bias also plays a part in both the perceptions of the supposed roles of women as well as their ability to do certain jobs, and this bias can often impact hiring and promotion decisions.

Cultural change, both inside and outside of businesses, is always slow, but the de-gendering of leadership traits is necessary to increase women’s participation in executive roles. “This process, from a behavioral and cultural-psychology point of view, will be a long one, and will require a long-term change in perceptions of those in businesses as well as society as a whole,” says Zhang.

A further issue is a lack of self-confidence, especially in younger women in the workforce. Harvard Business Review research shows that women under 25 often lack confidence in their abilities, and this affects their willingness to apply for certain positions. Confidence levels between men and women tend to even out as they age, but a lack of confidence in younger women can stunt early career growth.

Shifting stances

Several options may lead to greater numbers of women in high-level positions. Legal frameworks can be created that require a certain number of executive positions or board seats to be held by women.

Countries such as France, Sweden and Norway have all utilized such frameworks and as a result have an increased participation of women in the upper echelons of businesses. Hiring quotas for diversity purposes can be controversial, but without them change is likely to be glacially slow.

“I used to disagree with legal frameworks such as this, as they might put people in positions they were not prepared for,” says the Managing Director. “But now it feels like the only real option to kickstart change.”

The Chinese government has been taking steps to improve the ability of women to rise up the ranks in business. The 14th Five-Year Plan set out support for more family-friendly policies, including parental leave, equal pay and changing norms in the allocation of household work, while recognizing the care economy as essential for maximizing women’s contributions to the economy.

But in some cases, this could be a double-edged sword, with the solutions proposed to deal with the country’s demographic difficulties actually pushing women back into the household and out of business.

“In certain countries, I feel there is a move backward towards more traditional roles for women, and I worry that the recent actions of the Chinese government to encourage families to have more children could lead to a drop in the female workforce and leadership,” says the Managing Director.

Existing business leadership needs to ensure that gender parity is committed to as a business priority, as without consistent top-down support for change it is very likely that the status quo will persist.

Many businesses in China need to better foster an inclusive culture through educating employees on behavior, equality and bias in order to counteract pervasive cultural opinions on women. “Some of the workers at my company have a very traditional view of what leadership looks like and that it should be top-down, but how I lead is very different,” says Yu Xuan Chen. “Providing education and training in the workplace can help change these attitudes.”

Equitable support systems are also crucial for increasing women’s presence in leadership roles. Household burdens still fall largely on women, and therefore they often require more support from their employers in that area. The establishment of parental support and flexible working options are necessary, and leadership buy-in or utilization of such schemes will help reduce the stigma around the schemes.

Consistent mentorship and networking opportunities are also important, and this requires the creation of formal pathways in order for women to catch up, particularly to help dissipate the existing confidence issues that younger women face.

Looking ahead

The number of female leaders in China’s companies is growing, but they are still in the minority, despite the clear business benefits of having a more equal gender split at the highest level. But the positive trend is promising and there could be a compounding effect as numbers grow.

“We’ll definitely be seeing more women in leadership positions over the next five to 10 years,” says Yu Xuan Chen. “Younger generations are less and less interested in traditional gender roles and the more women leaders we have, the more younger women will see what they can achieve.”