Retaining and developing women leaders: a business issue.

• Position: Elliott, Davis

What motivates firms to reassess their efforts to retain and nurture women's leaders? "We really didn't come to a sharp realization that we had a problem," says CPA Todd Mitchell of Elliott Davis, in Greenville, South Carolina. "But we did notice that we had a great group of people through the manager level, then a lot of managers started to disappear, and they were all females. We had both women and men moving up, then all of a sudden the number of women dropped off, with very few at the shareholder level."

What was behind this problem? "We found the issue was not only turnover but also stagnation," Mitchell says. "Our team members were talented, but they were not moving ahead."

In the midst of this process, the firm was also considering succession issues. "We asked ourselves who would succeed our stars and superstars," he reports. "We realized that even if every male in the pipeline moved up, we wouldn't be able to fill the positions we were projecting in our strategic plan, given our expected growth. That's when we knew we had to be more successful at moving women into top leadership, including ownership positions."

The problem also had an impact on the firm's M&A prospects. "Women at potential merger partners asked where our female leaders were," he says. "They questioned how they would be treated at our firm."

Such questions hindered the firm's ability to grow through mergers.

According to consultant Mary Bennett, stagnation and turnover among women, a lack of female leaders and succession concerns are common problems at many firms. Given the impending retirement of the baby boom generation, firms are assessing how many new leaders they will need. "They are realizing they cannot get there with half the population. Firms will fall short if they don't take advantage of all the talent available to them."

As firms wrestle with this challenge, Bennett cautions against succumbing to the "pipeline myth."

"Many people say that once women have been in the...