MCCA® 2006 Survey of Fortune 500 Women General Counsel

Profiles

Elisa D. Garcia C, Domino’s Pizza
Executive Vice President, General Counsel and Secretary

Jackie Mahi Erickson, Hawaiian Electric Company, Inc.
Vice President and General Counsel

Joyce E. Mims, Ryerson Inc.
Vice President and General Counsel

Wendy C. Shiba, PolyOne Corporation
Senior Vice President, Chief Legal Officer and Secretary

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MCCA’s 2006 survey identified 83 women general counsel in the Fortune 500-compared to just 76 reported last year. ¹ Of the new faces, 11 were appointed to the position, while eight veterans helped their companies rise to the prestigious 500. ² Four companies traded diversity for more diversity: New women general counsel succeeded women at Calpine Corporation, CIGNA Corporation, and Nash-Finch Company, while Levi Strauss & Co. replaced its outgoing Hispanic male general counsel with a woman.

Teri McClure of the United Parcel Service, Inc. became the only new non-Caucasian woman to join the ranks of the Fortune 500 since Kellye Walker’s appointment at BJ’s Wholesale Club, Inc. in 2003. Another minority leader, Joyce E. Mims, general counsel of Ryerson Inc. since 1999, led the industrial metals wholesaler from the Fortune 1000 into the Fortune 500 for the first time. ³ On the other end, Andrea Zopp, the widely respected Fortune 500 leader of Sears who helped the company complete an $11 billion merger in 2005 to become Sears Holdings Corporation, left the company at the end of last year to pursue other opportunities.

MCCA® thanks author Alea J. Mitchell for all of her work in the preparation of the article, analysis of the survey results, and related research; Vicki Richardson, Esq. for completing the extensive and time-consuming survey of 1000 companies to compile data on race/ethnicity and gender of the general counsel; Elisabeth Frater, Esq. of Gravett & Frater for authoring the one-page biographies of the four women general counsel; and I. Clayvon Lighty of Lighty Communications Group, Inc. and editor-in-chief of Diversity & the Bar® for her editorial support and for managing the process.

 

Ryerson Inc. since 1999, led the industrial metals wholesaler from the Fortune 1000 into the Fortune 500 for the first time. 3 On the other end, Andrea Zopp, the widely respected Fortune 500 leader of Sears who helped the company complete an $11 billion merger in 2005 to become Sears Holdings Corporation, left the company at the end of last year to pursue other opportunities.

There are now 75 Caucasian (90.4 percent), five African American (6.0 percent), and still just one Hispanic (1.2 percent) women general counsel among this elite group. ⁴ There are no Asian American/Pacific Islander women general counsel in the Fortune 500. In this respect, the Fortune 500 has a long way to go before it mirrors demographic changes in both the general population and the legal industry.

While growth in ethnic diversity over the past few years has been sluggish at best, the breadth of diversity of industries represented by women general counsel remains strong. Financial services and insurance firms still lead the list with the most women heading Fortune-ranked in-house legal departments. Yet, general merchandisers and retailers, gas and utilities, pharmaceuticals, and food services companies are all close runners-up. These 83 leaders were based throughout the United States, but Texas boasted more women general counsel than any other state (13). California and New York were a close second, with 10 each.

If bottom-line profits are the most salient benefit of diverse leadership, then these 82 companies ⁵ had much to celebrate: Revenues for companies led by women general counsel grew by nearly $7 billion over the previous year to a high of $86.7 billion. Their combined earning power in the Fortune 500 alone topped $1.29 trillion dollars. As in last yearreport, the vast majority counseled companies with revenues between $5 and $19 billion (58 percent). Unlike last year, those with profits above $20 billion (23.4 percent) significantly outnumbered those with profits below $5 billion (18.5 percent). These numbers do not reflect earnings by Royal Dutch/Shell Group, a Fortune Global 500 company led by General Counsel Catherine Lamboley, with revenue of $268.6 billion.

Accordingly, the number of women general counsel of the highest grossing Fortune 250 companies is now 34-an increase of four, or 1.6 percent, in just one year’s time.

Fortune 500 Departures

While 12 women general counsel left Fortune 500 companies, only four were replaced by men (Constellation Energy Group, Dynegy Inc., Sears Holdings Corporation, and US Airways Group). In late 2004, Dynegy, where the CFO is a woman, promoted Carolyn Campbell to group general counsel-corporate finance and securities and corporate secretary, positioning her in the pipeline toward department leadership.

Three departing general counsel fell subject to mergers: Jane Davis (Johnson Controls acquired York International Corp.), Anastasia Kelly (Verizon acquired MCI), and Linda Tiano (WellPoint, Inc. acquired WellChoice, Inc.). WellPoint’s continuing general counsel, Angela Braly, is among MCCA’s Fortune 500 women general counsel, and has been since last year’s report.

Elizabeth Abdoo and Beth Byster Corvino, general counsel of Host Marriott Corporation and Laidlaw International, Inc., respectively, remain in their positions; they are now listed among the Fortune 501-1000 women general counsel.

Finally, as mentioned earlier, three women were replaced by other women. Judith Soltz, who retired after 28 years with CIGNA Corporation, was replaced by Carol Ann Petren, former deputy general counsel of MCI and, prior to that, Sears-both companies that have graced MCCA’s annual Fortune 500 women general counsel list. CIGNA Corporation, too, is a noted diversity leader. This past September, Soltz, on behalf of CIGNA Corporation, accepted the Corporate Star Award from the Forum of Executive Women for the diversity of its board of directors, of whom four out of 11 (36 percent) are women. ⁶

MCCA® LIST OF WOMEN GENERAL COUNSEL AT FORTUNE 500 COMPANIES

Fortune 501–1000

The results regarding women general counsel in the Fortune 1000 ⁷ are less readily conclusive. Seventy four women general counsel comprise this group, up from the 66 reported last year. There were 31 new additions: nine newly identified first-time participants and 22 new appointees.

The new arrivals’ backgrounds offered no set answer regarding the path to the general counsel office. Seven were promoted in-house after having served at their respective companies for a number of years. Six moved laterally from general counsel or associate general counsel positions at other companies. Two moved from law firms, and one from the public sector.⁸

Representation by industry was as widespread as the groups’ backgrounds. Utilities—including energy, gas, pipelines, and petroleum refining—continued to lead the group in number of women general counsel in the Fortune 1000 (11), a trend observed in the 2005 report. Beyond utilities, though, no other industry seemed to stand out. From electronics to general merchandising, pharmaceuticals to real estate/hotels and casino resorts, these women represent the full gamut of industries.

Similarly, Fortune 1000 women general counsel were spread throughout the continental United States: New York (seven), New Jersey (seven), Illinois (six), Ohio (six), California (five), and Texas (five). Each had comparatively higher concentrations of women general counsel, but leaders also were found in Hawaii and Puerto Rico and many states in between.

Despite a lack of major change in demographics, this group continued to be more diverse than the Fortune 500 group, an observation first seen in last year’s report. African American representation decreased by two, and the number of Hispanic women remained static at three. Surprisingly, given their lack of representation in the Fortune 500, the number of Asian American/Pacific Islander women general counsel in the Fortune 1000 grew by two.

By race, 61 Fortune 501–1000 women general counsel are Caucasian (82.4 percent), one is African American (1.3 percent), four are Asian American/Pacific Islander (5.4 percent), and three are Hispanic (4.1 percent). Five women declined to confirm their race.

Tempering the growth and diversity within this sector were a sobering 20 departures. In only three instances did women replace outgoing women general counsel—Corn Products International, Inc., Quanta Services Inc., and New Jersey Resources Corporation. At Corn Products, Marcia Doane, former general counsel, ascended to vice president and senior legal counsel to the CEO, and will assist the newly appointed general counsel, Mary Ann Hynes, in an advisory capacity.

Nine women were succeeded by Caucasian men. One, Valerie Gentile Sachs (Jo-Ann Stores), resigned to become vice president, general counsel and secretary of OM Group, which was Fortune number 405 in 2004 but displaced altogether in 2005. Also of this group was Connie Holbrook, who retired after 20 years with Questar and was praised by Chairman and CEO Keith Rattie for having served as “chief of staff to three Questar CEOs, three generations of senior management, and the board for over two decades.”⁹

Four companies fell off the Fortune 1000 list altogether: CellStar, Primedia, Teradyne, and TD Banknorth Group. In all but one instance, each general counsel retained her position as head of the legal department. Beverly Chell of Primedia, the exception, now serves as vice chairman and interim CFO.

Two companies were acquired: The Mandalay Resort Group merged with MGM Mirage, and Providian Financial was acquired by Washington Mutual, whose general counsel, Fay Chapman, is listed among the Fortune 500 women general counsel.¹⁰

MCCA® 2006 FORTUNE 500 WOMEN GENERAL COUNSEL BY INDUSTRY AND RACE

Esta Stecher Organizations need to reflect the diversity of their client base and recognize that they cannot exclude 50 percent of the population if they intend to win the war for talent. Women have unique skills and sensibilities and often bring a different perspective to bear on the problems needing resolution.

Michele Coleman Mayes Those of us in key decision-making positions must ensure that [the women currently filling the pipeline] have the experiences and insights they need to contend for and land general counsel positions-including how to negotiate appropriate remuneration.

Lynne Burgess It is also hard work, pressure-filled, and fraught with potential liability, especially for public company general counsel. So you need to have dogged determination to succeed and be engaged full time and then some.

MCCA® LIST OF WOMEN GENERAL COUNSEL AT FORTUNE 501-1000 COMPANIES

Looking Forward

Overall, the findings from MCCA’s 2006 survey of women general counsel offer a mixed report on trends occurring among Fortune companies. On the one hand, women legal leaders enjoyed another year of growth and reflected remarkable diversity-of industry, region, and experience, for example. On the other hand, the number of departures balanced-and, in the case of the Fortune 1000, outnumbered-the number of arrivals. The latter was more pronounced for women general counsel of color.

While turnover at this level is common regardless of gender, its occurrence highlights potential challenges for women’s advancement: Are there lingering recruiting and retention biases or negative perceptions of women leaders that need to be addressed? Is the pipeline to leadership flush? Are women promoted and compensated fairly?

Michele Coleman Mayes, general counsel of Pitney Bowes, speculates that given the high stakes for public companies, if a bias is present it is more likely in the selection process and not afterward. In addition to the laws and regulations, says Mayes, a general counsel has responsibility for balancing the interests of individual corporate clients and the board of directors: “It is no small feat to balance these interests—particularly in this scandal-sensitive climate.” It is a position that demands the respect of, and accessibility to, senior management and the board.

“One is tempted to ask the question whether the advice and counsel of a woman general counsel is perceived and received differently. Quite honestly, there is not much time for bias when the outcomes are so important,” says Mayes. “I would speculate that once the decision is made to hire a female general counsel, the question of gender becomes less of an issue than it might be in the selection process. I think it is far more likely for gender to play a pivotal, albeit possibly subconscious, role at that stage.”According to Mayes, one way to overcome bias in the selection process is “to have candidates who are too good to ignore and have the confidence to go along with their pedigree.” The potential for a robust pipeline is greatly increased today, Mayes notes, with “the number of female graduates from law school tipping over the 50 percent mark.”

It is a pipeline that Lynne Burgess, general counsel of Asbury Automotive, observed firsthand while attending a recent awards luncheon. “There were hundreds of women lawyers there, and that’s just a subset of women lawyers in the New York metropolitan area,” says Burgess. “I can’t believe that the same critical mass of talented women committed to excellence and careers isn’t present around the country.”

The challenge then, says Burgess, is multifold. For the industry, it is how to attract the right candidates and retain them once hired. For potential general counsel, it is: “Do I want this badly enough to make the sacrifices to get there, will I be able to find a balance between work and personal life, and will the professional and financial rewards be worth it?”

“Men face these questions, too, of course, but much more subtly,” says Burgess. “The societal pressures that push men to pursue career over personal lives are the same pressures that are daily reminders to women in career paths to question their choices.”

As stated by Burgess, being a general counsel in the post-Enron and Sarbanes-Oxley world is stimulating and challenging. “It is also hard work, pressure-filled, and fraught with potential liability, especially for public company general counsel. So you need to have dogged determination to succeed and be engaged full time and then some.”

Burgess says that women who want to be part of the management team with equal respect and compensation need to be as engaged as the other members of that team. “Success in the workplace won’t happen if we’re not available to service our clients,” says Burgess. “This means we need to put in place the resources to take care of home and personal lives while we’re at work, whether it’s caring for children or elderly parents.”

Once the commitment has been made on the part of women lawyers, it is important that they are afforded the right opportunities to succeed.

To this end, Goldman Sachs General Counsel Esta Stecher takes an active role in internal and external activities designed especially for this purpose. Through participation in her company’s Firmwide Diversity Committee, Stecher has sponsored occasions recruit, retain, and increase the visibility of and opportunities for women at Goldman Sachs, as well as to increase accountability and ownership throughout the firm for the careers of women.” For example, Stecher has hosted a series of dinners for female managing directors of the firm and members of the firm’s Management Committee to discuss key business issues and strategies for retaining top talent. Stecher also participates in programs designed to address the special challenges faced by more junior women, particularly those with young children.

More recently, Stecher took part in a new program, “New Directions: The Next Step in Your Career,” a Goldman Sachs program that challenges the assumption that the only way to succeed in finance is by pursuing a linear career path and working very long hours seven days a week. “We invited over 100 women who have left the financial services industry, but are interested in restarting their careers, to participate in this program,” says Stecher.

The active engagement by senior leaders in activities designed to attract and retain potential women leaders is integral to their advancement. According to Mayes, “Those of us in key decision-making positions must ensure that [the women currently filling the pipeline] have the experiences and insights they need to contend for and land general counsel positions-including how to negotiate appropriate remuneration.”

This last point may be of particular concern. A recent Diversity & the Bar® article reported that Caucasian women general counsel make roughly $250,000 less in total cash compensation than their male counterparts, and minorities nearly $400,000 less.¹¹ “The disparity between male and female general counsel and between non-minorities and minorities is no secret,” says Burgess. “I am not surprised by the statistics that bear out my anecdotal observations, but I am incredibly discouraged by it.”

Burgess suggests that the problem is complex. “It is still very hard for women and minorities to get a seat at he big table. Most, not all, of course, but most, of the ‘rock star’ general counsel positions-high-profile, big company, substantial compensation and perks-go to non-minority men,” says Burgess. “Those positions should command high salaries and other compensation and perks; it is good for our profession for companies to acknowledge the key role lawyers play.”

“The question is how to get more women and minorities into those positions. Too often we settle for less just to have the opportunity. This lessens our value in the eyes of the companies, which confirms the decisions they make about compensation and status, and the cycle continues,” says Burgess. “Networking and mentoring are the keys to changing this dynamic.”

From compensation to pipeline, though, the industry is facing its challenges, a fact borne out by the rising umber of women general counsel in the Fortune 1000. “Frankly, there is a critical mass of like-minded general counsel of both genders who are committed to priming the pipeline,” says Mayes. “That fact alone should make a noticeable difference.”

“Organizations need to reflect the diversity of their client base and recognize that they cannot exclude 50 percent of the population if they intend to win the war for talent,” says Stecher. “Women have unique skills and sensibilities and often bring a different perspective to bear on the problems needing resolution. It is essential that we continue to stay focused on the challenges in recruiting, retaining, and promoting talented women.”

“As I have observed before, with the war for talent just starting to boil as baby boomers, like myself, leave the work force, we had better wise up and learn to tap into the talent this country demands to remain the powerhouse it is,” says Mayes. “If we fail to do that, I wager that we’ll be unable to sustain this economy and maybe even this society. The stakes are quite high.”

MCCA® 2006 FORTUNE 501-1000 WOMEN GENERAL COUNSEL BY INDUSTRY AND RACE

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NOTES

1. Unless otherwise indicated, Fortune 500 numbers include Catherine Lamboley, general counsel of the Shell Oil Company, which is ranked number four among the Fortune Global 500, an annual ranking of the world's largest corporations, as opposed to the Fortune 500, which ranks America's largest corporations.
2. While new to the list this year, Suzanne Bettman replaced Monica Fohrman as general counsel of R.R. Donnelley & Sons Company in 2004, and Joyce E. Mims has served as general counsel of Ryerson Inc. since 1999.
3. Virginia Dowling, deputy general counsel of Ryerson Inc., was misreported in MCCA's 2005 report as general counsel. Dowling reports to Joyce E. Mims, who has served as general counsel of Ryerson Inc. for the last eight years.
4. These percentages are based upon the total number of women general counsel. As a percentage of all Fortune 500 general counsel, Caucasian women are 15 percent, African American women one percent and Hispanic women just 0.2 percent. MCCA® was unable to confirm the race of two women.
5. There are 83 women general counsel at 82 companies in the Fortune 500, including Royal Dutch/Shell Group. Blockbuster's legal department is headed by a triumvirate-a leadership team consisting of two women and one man.
6. See "2005 Women on Boards," The Forum of Executive Women, at http://www.foew.com/clientfiles/pdf/WOB2005.pdf. Also, See "CIGNA Honored for Diversity of its Board of Directors with Award from Forum of Executive Women," PRNewswire, Sept. 2005, at http://sev.prnewswire.com/health-care-hospitals/20050923/?PHF00923092005-1.html.
7. The term Fortune 1000 is used here to refer to companies ranking among Fortune's 501-1000 companies.
8. We were unable to confirm information for six women general counsel: Dana Carabin (EGL), Eileen Coggins (Genesis HealthCare), Nesa Hassanein (Sports Authority), Martha Moyer (Dura Automotive), Tana Pool (Quanta), and Denise Tolles (Linens 'N Things).
9. See "Questar Announces Senior-Management Retirements, Appointments," Questar News Release, Feb. 2005, at http://www.questar.com/news/2005_news/02-09-05b.pdf.
10. The two companies unaccounted for here are Burlington Coat Factory and Ryerson Inc. Of the former, Valerie Dion was misreported as general counsel in the 2005 report; Paul C. Tang is general counsel of Burlington Coat Factory. Of the latter, Virginia Dowling, of Ryerson Inc., led her company from the Fortune 1000 into the Fortune 500 for the first time this year.
11. See Scott Mitchell, "Are Women and Minority General Counsel Undercompensated?" Diversity & the Bar®, March/April 2006. The study was based on a preliminary examination of the compensation of the most highly paid general counsel in the Fortune 500 as reported to the Securities and Exchange Committee and re-reported by a 2005 survey conducted by American Lawyer Media. It must be noted that the surveyed pool is restricted to those companies listing their general counsel among their five most highly paid officers in their annual proxy statements.

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From the July/August 2006 issue of  Diversity & The Bar^®