Women remain strikingly rare at the very top of American corporate life. Fewer than 10 percent of chief executive officers at S&P 500 companies are women, a figure that has improved only slowly despite two decades of public commitments, diversity programs and mounting pressure from investors. A new study led by the University of Massachusetts Amherst suggests that part of the answer may lie not in hiring practices or corporate culture, but in something far more mundane and far more powerful: how a company is organized on its accounting ledger. According to the research, published in the Strategic Management Journal, women managers are significantly more likely to be promoted to CEO at firms divided into separate business units, each with its own revenues, costs and bottom line, than at companies that operate as a single, stand-alone entity.
The study, led by Ulya Tsolmon, associate professor of strategy at the Isenberg School of Management at UMass Amherst, and co-authored by Tingyu Du of California Polytechnic State University, finds that women in multi-unit firms had a 37 percent higher probability of internal promotion to CEO than women in stand-alone firms. The magnitude of that effect is notable in a context where promotion to the top job is extraordinarily rare in any given year. Across the dataset, promotion to CEO occurred in roughly 0.56 percent of about 2.4 million manager-year observations, meaning that any factor that shifts the odds by more than a third deserves serious attention from both researchers and boards.
The scale of the evidence base lends the finding considerable weight. The authors drew on 25 years of personnel records from the LexisNexis Directory of Corporate Affiliations, covering 616,754 managers at 49,135 U.S. companies between 1993 and 2017. That longitudinal design allowed the researchers to observe individual managers’ careers over time and to compare promotion outcomes across firms with different organizational architectures. Rather than relying on surveys or self-reported accounts of advancement, the study tracked what actually happened to hundreds of thousands of executives as they moved, or failed to move, toward the corner office.
The central mechanism the authors propose is accountability through measurable performance. When a manager runs a division with its own profit-and-loss statement, her results are quantified, comparable to those of the executives running other divisions, and, crucially, difficult to attribute to anyone else. This narrows the space for subjective judgment, the territory where decades of research on evaluation have repeatedly found bias creeping in. As Tsolmon explains, it is clear who has led the unit, and a division with its own P&L makes it much easier to say that a specific person ran a specific business and to point to the results. Performance becomes legible in a way that reputation, sponsorship and informal standing are not.
That legibility matters because promotion decisions at the highest level are rarely made on objective criteria alone. In centralized, stand-alone firms, assessments of senior managers often depend on internal control exercised through hierarchy, relationships and impression management. Executives advance by cultivating allies, navigating networks and shaping how their contributions are perceived. Tsolmon suggests that this environment can be more difficult for women if they have fewer chances to break into the networks that allocate resources and promotions. In a divisionalized firm, by contrast, the numbers produced by each unit create a common currency of evaluation that is harder for prejudice to distort.
The contrast with the historical record of the gender gap is stark. As recently as 2015, there were more men named John running major U.S. companies than there were women, Tsolmon notes, a comparison that captures the scale of the disparity better than any percentage. The gap, she emphasizes, is not just any disparity but a huge one. Against that backdrop, the finding that something as structural as firm architecture can move promotion odds by 37 percent reframes the problem. The explanation may have less to do with attitudes and more to do with accounting, with what information organizations generate about the people who work inside them.
We tend to think about organizational structure as a question of efficiency, coordination and control, Tsolmon says. But structure also determines what information organizations produce about people, and that can affect who gets ahead. This insight carries implications well beyond the question of who becomes CEO. If the visibility of performance shapes promotion outcomes at the top of the hierarchy, it may shape hiring, evaluation and advancement decisions at every level below. Multi-unit firms delegate more authority, which means they must mentor managers and tie incentives to results, practices that generate objective records of individual contribution as a byproduct of doing business.
The authors are careful about what the study does and does not show. The results describe associations rather than proof that restructuring a company will produce women CEOs, and Tsolmon is explicit that the prescription is definitely not that everybody should just go out there and become divisionalized. Companies do not choose their structures at random, and each architecture carries trade-offs. Divisionalization can impose costs of coordination, duplication and competition among units, and it is not a lever that boards can pull in isolation from strategy, industry and scale. The finding identifies a relationship, not a ready-made intervention.
There is also an important limit at the front end of the pipeline. Divisionalization does not necessarily address inequality elsewhere, particularly when it comes to who gets handed a division to run in the first place. If women are underrepresented among division heads, then even a fair, numbers-driven promotion process at the top will operate on a skewed candidate pool. The mechanism the study identifies works by making already-appointed leaders’ results harder to discount; it does not by itself correct the earlier sorting decisions that determine who leads a unit with its own P&L. Tsolmon would like future research to examine whether the gender gap emerges earlier on the career ladder, and whether the visibility of performance affects men and women differently as they climb.
For boards and executives, the study offers a way of thinking about diversity that shifts attention from attitudes to architecture. Rather than asking only how evaluators can be trained to judge fairly, it asks how organizations can be designed so that judgment has less room to wander, so that the record of who ran what, and with what results, speaks clearly enough that bias has fewer openings. Until we really understand the mechanisms behind the disparity, Tsolmon cautions, it is hard to prescribe solutions. But the research makes a compelling case that the path to the CEO suite runs through structures, not just sentiments, and that the ledgers companies keep may quietly decide who gets to sign them.
Subject of Research: The effect of firm divisionalization on the gender gap in CEO promotion
Article Title: Want more women CEOs? Start with company structure, research finds
Article References: Want more women CEOs? Start with company structure, research finds. (n.d.). Original publication
Image Credits: AI Generated
DOI: Not provided
Keywords: women CEOs, organizational structure, divisionalization, gender gap, CEO promotion, profit-and-loss accountability, Strategic Management Journal, corporate governance, leadership diversity, managerial careers, UMass Amherst, performance evaluation
Cite Scienmag News
Courtney Benton. (October 13, 2026). Company Structure May Hold the Key to More Women CEOs, Study Finds. Scienmag. https://scienmag.com/company-structure-may-hold-the-key-to-more-women-ceos-study-finds/
Courtney Benton. "Company Structure May Hold the Key to More Women CEOs, Study Finds." Scienmag, 13 October 2026, https://scienmag.com/company-structure-may-hold-the-key-to-more-women-ceos-study-finds/. Accessed 13 October 2026.
Courtney Benton. "Company Structure May Hold the Key to More Women CEOs, Study Finds." Scienmag. October 13, 2026. https://scienmag.com/company-structure-may-hold-the-key-to-more-women-ceos-study-finds/

