Are women on a collision course with the COVID ceiling?

We know working women are in crisis right now. But will the pandemic also infect the pipeline to the top of corporate America for women in the future?
October 4, 2021, 9:30 AM UTC
Illustration by Janelle Barone

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When former PepsiCo CEO Indra Nooyi joined the beverage and snack giant in 1994, she had never worked with a more senior woman or even had a close female colleague at her level. The 15 top jobs in the company were all held by white American men in blue or gray suits. The bylaws of corporate America had been written for men by men. Nooyi would go on to change some of those rules, but to get to the top, first she had to learn them. “If you don’t understand what happens in the corridors of power by interacting with men, you end up falling further behind,” she says. 

Those corridors, like the rest of our lives, have moved online over the past 18 months, making it even more challenging for women to elbow their way into the spaces that have long shut them out. In a survey of members of Fortune’s Most Powerful Women community—a group that primarily consists of CEOs and other C-suite executives—55% said they did not think they could have advanced to their current role if they had spent significant stretches of their career working remotely. In a virtual world, how do you know that no one clued you in on the important Zoom that is happening right now? When you’re physically present, you can walk past the conference room or peer into your boss’s office. “At least then you know you weren’t invited,” Nooyi says with a laugh. 

No matter the industry or title or level of seniority, the economic disruption caused by COVID-19 will leave a scar on working women in ways that other downturns have not. Blue-collar women lost their jobs and have yet to fully regain them. Working mothers whose livelihoods were saved by telework dropped out at higher rates than women without children and men. Those who remained did so at a cost. “Mothers who stayed in the labor force had great stress, anxiety, and frustration,” says Claudia Goldin, a professor of economics at Harvard. “They were working under tremendous strain.” 

It’s acutely wrenching that the pandemic arrived just as women were reaching new milestones in the labor market. In January 2020 they made up more of the workforce than men for the first time in over a decade. At the very top of corporate America, women were starting to not just receive invitations to those closed-door meetings but actually run them. In June, when the most recent Fortune 500 list was published, a record 41 women led some of the biggest companies in the U.S. Let’s pause to acknowledge this is still a depressingly low number—but it is progress. Ten years ago, there were only 12. 

Given the urgency of the crisis hitting women in other segments of the working world, it’s understandable that there hasn’t yet been much attention paid to the pandemic’s potential impact on women in the C-suite. But whether the ranks of female CEOs will continue to grow in a post-COVID future has implications far beyond the corner office. Women are graduating from college at significantly higher rates than men and are starting to get closer to parity in the most competitive MBA programs. But the ratio flips inside U.S. corporations, and the discrepancy grows the closer you get to the top. A recent report from McKinsey and found that women face a “broken rung” at the step up to manager. Last year, 89 white women and 85 women of color were promoted to manager for every 100 men. “Think of this as an economist, not a feminist,” says Nooyi. “This is our single biggest opportunity, and somehow we’re suboptimizing that.” 

Ex-PepsiCo CEO Indra Nooyi says women are rethinking their career aspirations.
Erik Tanner—Redux

One way to address corporate America’s self-defeating failure to empower women is to put people devoted to improving diversity in leadership roles. Those people tend to be women, and particularly women of color: The McKinsey/ study found that female executives were almost twice as likely to spend a substantial amount of time on diversity, equity, and inclusion outside of their core jobs compared with men. It’s a vicious or virtuous cycle, depending on how you look at it: Lose women at the top, and you lose the engine driving change throughout the company.

Current and former female Fortune 500 CEOs say they are less concerned about the outcomes of the generation now poised to enter the C-suite than women further down the pipeline. It’s the senior directors and the VPs who are at risk—the women who may still have younger children at home, the ones Land O’Lakes CEO Beth Ford describes as “those who don’t know what is yet possible for themselves.” In our survey, 58% of respondents who could identify a promotion or job that had been a turning point in their career said it came during the prime child-rearing age range of 30 to 39. 

For Ford, it wasn’t until she was in her forties that she realized she had the potential to be a CEO. When the Land O’Lakes board tapped her for the job in 2018, she had worked at seven companies across six industries. Research by executive search firm Korn Ferry has shown that this kind of range is critical for female CEOs, who tend to work in more sectors, organizations, and jobs over the course of their careers than male chief executives. But some of that movement has stalled over the past year and a half. “When you’re on that trajectory, you’re taking opportunities to move. You’re being seen by the senior team; you’re understanding what it’s like to be a leader,” Ford says. “Some of those things are still happening, but it’s happening totally differently. There’s a delay, and it’s causing some real problems in terms of your vision for yourself, your aspiration, your ambition.” 

Land O’Lakes’ Beth Ford didn’t see her own CEO potential until her forties.
Photograph by Jessica Chou

When Ursula Burns took the helm at Xerox in 2009, she was the first Black woman to ever run a Fortune 500 company. Burns says she had always been prepared, good at what she did, but not any kind of “super brain.” What made the difference for her was she was known, seen, and spoke up. The most senior executives took an interest in her success, selecting her for special projects that revealed the inner workings of the company. But during this era of working from home, Burns says the risk of “out of sight, out of mind” has been more acute for women and people of color. It has also made it even harder to find a cohort of people who look like you at work. “That was rare. And now it’s literally gone,” she says. “It’s more likely that you are isolated and not recognized and not known.” 

The pandemic has put at risk not just employees’ own visibility but also their ability to gain insight into the companies they work for. Ellen Kullman, CEO of 3D printing technology company Carbon, says she’s concerned that it’s harder to assess a work situation in a remote environment. She spent her formative years at GE but left in 1988. “It was feeling that I was potentially never going to be allowed to compete at the highest levels,” she says. “My experience there was that it was different for me than it was for some of my male counterparts. At some point, you just make a choice.” She joined DuPont, which she says had a more egalitarian culture, and ran the company from 2009 to 2015. 

The pandemic has thrown work culture into a mind-numbing chaos. But that chaos has also challenged the rigidity of corporate America, which punished workers—especially women—for asking for anything outside of its norms. “This is one of the largest reorganizations of work for professionals that’s ever happened,” says Marianne Cooper, a sociologist at the Stanford VMware Women’s Leadership Innovation Lab. While the majority of our survey respondents said working remotely would have hurt their own trajectory, more said that going forward remote work would help women’s careers rather than hurt them—a sign that change is underway. “You can’t have a flexibility stigma anymore if everyone is home,” says Erin Reid, a professor at McMaster University’s business school, who studies gender in the workplace.

Jennifer Morgan left her job as co-CEO of SAP last year and took eight months off to spend some time thinking about what she wanted to do next. She is now the global head of portfolio operations at Blackstone, and the time she spent reassessing her own career has made her think more broadly about what work should and can look like. “We talk about digital disruption, we talk about business model disruption,” she says, “yet we all still have a very traditional notion of talent.” As she’s been building her team, more candidates have been asking for something different: part-time work for a very senior role, a scaled-back position for a woman returning from maternity leave. She has said yes to all of it—something she might not have done in the past. 

Some academics believe that a radical change in how jobs are organized could really make a difference for working parents. But there are clearly limits to how far up the chain this kind of restructuring can go. Like many companies, Kullman’s Carbon instituted a no-meetings policy one day a month to free employees from the tyranny of Zoom. Kullman says it reenergizes people and opens up mental space to dig into big issues or problems. The one person who does have meetings that day? The CEO. “There’s always something that comes in,” Kullman says. As Nooyi puts it, “There is no flexibility at the very top.”

In the midst of so much uncertainty, corporate boards have become more risk averse about undertaking a CEO search. And those that have gone ahead have been just as risk averse in their selection. A study by executive search firm Heidrick & Struggles found that during the early months of the pandemic, companies prioritized candidates with previous CEO experience. Because few women already have those three critical letters on their résumés, the rate of female executives selected declined. 

Some headhunters believe that the next six months will turn all these trends on their head—that the pent-up demand for change at the top will be a boon for women. There are two big factors driving this prediction, says Jana Rich, founder and CEO of executive search firm Rich Talent Group. The first is that the pandemic has put more value on qualities that, rightly or wrongly, tend to be attributed to women, such as empathy and authenticity. “EQ—this emotional quotient—has been more important in the last 18 months than certainly any time I’ve ever seen in my career,” says Best Buy CEO Corie Barry.

The second is momentum. More than 60% of respondents in the Fortune survey said their senior management team had become more diverse in the past year. “We are at a point where there’s so much visibility about the lack of diversity in the C-suite that going back is almost impossible,” says Burns, whose board work includes Teneo, Exxon Mobil, and Uber. But she’s concerned that the enormous pressure senior leaders are under to make their companies less homogeneous will lead them to elevate white women, the group most familiar to those already in power, and declare success when people of color have made little progress. “It’s a risky time from that perspective,” she says.

There is one looming, existential question that could make all this debate moot: Do women still want what corporate America is selling? “If everything is geared around white male norms, then we shouldn’t be surprised that the product doesn’t fit,” says Jane Stevenson, vice chair of board and CEO services at Korn Ferry. 

Rich could, off the top of her head, name two women from the tech industry whose next jobs easily could have been as CEOs of high-growth companies. Instead, both walked away. “There’s definitely a huge reevaluation happening,” she says. “The question is, do they want these jobs? They look at it and say, ‘You know what, I’ve been awfully close to that fire, and I don’t want it.’ ” 

Nooyi, who’s been in the hot seat, gets it. She says moving into your next job was the only thing her generation knew. “A lot of women are asking, ‘Is this really worth it?’ It’s just exhausting.” 

Still, that might not be as dire as it sounds. Women who opt out of traditional ladder climbing will end up building their own pathways, says Nooyi. She believes this cohort will create their own companies and measures of success that are different from those prescribed by traditional corporate America, otherwise known as white men. “They made the rules, they live by the rules,” Nooyi says. “We need a critical mass of women to make our own rules.”

That’s a future some—including those who made it to the top the old way—are more than ready to see. “I want them to actually have the chance to articulate out loud, ‘I don’t want to do this. Thank you for offering,’ ” says Burns. “That’s true equity, that’s true equality—when you get the chance to turn the goddamn thing down.” 

This article appears in the October/November 2021 issue of Fortune.

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