As recently as last year, pharmacy chains were a bright spot for female leaders — one of the few sectors in corporate America where women could make it to the very top. Rosalind Brewer was CEO of Walgreens Boots Alliance Inc. and, at the time of her appointment, the only Black woman leading a Fortune 500 company. Karen Lynch was running CVS Health Corp., the biggest public company ever helmed by a woman. Heyward Donigan at Rite Aid Corp. rounded out the trio.
Today, all three are gone. Donigan and Brewer were both shown the door in 2023, and Lynch was ousted last week, when CVS announced that the board had unanimously decided to dismiss her after a string of disappointing earnings, repeatedly downgraded forecasts and pressure from investors.
In the aftermath of their collective departures, what’s now become apparent is that their rise had little to do with the pharmacy industry being particularly inclusive or intentional about fostering and promoting female talent. Instead, each company had an impossible job that needed to get done. And impossible jobs often go to women.
It’s a classic glass cliff scenario. A variation of the glass ceiling, this theory holds that women are mostly likely to get a shot at a big job when a company is in crisis or turnaround. In such cases, corporate boards are more willing to try a new kind of leader because the one they have (typically a white man) isn’t working out, or because likely male candidates see the job as a minefield they don’t want to touch. Women take the job because they know it may very well be their only chance to run a company. When they struggle or fail, boards then have an excuse to return to the leadership status quo (again: white men).
Despite the scale of what Lynch, Brewer and Donigan were expected to do — transform struggling businesses operating in the deeply broken health-care sector — they were not given much time to do it. All three lasted less than four years in the job, even shorter than the average 4.5-year tenure for female Fortune 500 CEOs, according to research firm Equilar. Meanwhile, the average male Fortune 500 CEO lasts 7.2 years. “There’s not a lot of margin for failure for women CEOs,” Marianne Cooper, a sociologist at the Stanford University’s VMware Women’s Leadership Innovation Lab, once told me.
At Walgreens, Brewer wasn’t given the full authority to turn around the struggling chain. She and her predecessor, Stefano Pessina, seemed to disagree on strategy, which wouldn’t have been as big a deal had he not remained executive chairman and one of the company’s largest individual shareholders. He wanted the company to expand through partnerships, not the acquisitions that Brewer sought. At the time of her departure, Pessina said the company was looking for a replacement with “deep health-care experience.” But he knew that wasn’t Brewer’s biggest strength when he touted her digital and retail bona fides at the time of her hiring.
Over at CVS, Lynch is out for the failure of a plan that was hatched before her arrival. Her predecessor, Larry Merlo, started CVS’ attempted transformation from struggling retailer into a health-care industry juggernaut with his nearly $70 billion acquisition of Aetna, where Lynch was then president.
Lynch was also contending with an activist investor, who wanted to shake up management. This particular challenge is not all that unusual for female CEOs, who have a 50% higher likelihood of being targeted by activist investors than their male counterparts. They could be bigger targets because they’re more likely to be running these struggling companies. Or perhaps it’s because activists know boards are faster to fire a female CEO. Or maybe it’s just because women face more scrutiny in general.
Case in point: While Lynch was ousted, CVS Chairman Roger Farah, who said last week that it was “the right time to make a change,” got promoted; he’s now executive chairman and will have more of a hand in running the company. That’s despite the fact that we can assume he and the rest of the board signed off on Lynch’s hiring and strategy in the first place.
Lynch, of course, was not blameless in all of this. She made plenty of mistakes. But it’s also important to acknowledge the things that were outside of her control — including the glass cliff she was facing.
By Beth Kowitt / Courtesy Bloomberg Opinion
