Women may have better odds of getting a membership at Augusta National Golf Club than becoming the chief executive officer of an energy company in the Standard & Poor’s 500 Index.
With its decision to name Lynn J. Good as its first female CEO, Duke Energy Corp. (DUK) will be the largest U.S. energy business by market value led by a woman. Good will be only the second female energy leader on the index, raising the amount to 0.4 percent, according to data compiled by Bloomberg. At Augusta National, home of the annual Masters Tournament, two women were allowed to join when the club changed its rules last year, accounting for 0.7 percent of an estimated 300-member roster.
While energy companies have long been led by engineers or lawyers, professions that were dominated by men, “over the last five to 10 years you’ve seen more women move into leadership,” Good, 54, said in a phone interview yesterday. “You see more women in the CFO ranks. It’s an evolution.”
Becoming chief financial officer, as Good was at Duke, may be one path to leadership for females in the energy industry. Women currently serve as CFOs at some of North America’s largest energy producers, including Chevron Corp. (CVX), Occidental Petroleum Corp., Marathon Oil Corp. and Encana Corp.
A CFO gets “great expertise to become a CEO so long as you show that you’re not doing just the day-to-day numbers but you are really looking at all the possibilities of how a company can grow,” said Susan Stautberg, co-chairman of Woman Corporate Directors, a global association of female board members.
There were 54 women serving as CFO of S&P 500 companies in January, up from 40 a year earlier, according to data compiled by Bloomberg.
While energy companies have trailed other industries in appointing female CEOs, the number of women directors has risen in energy board rooms in Calgary and Houston, Stautberg said.
“Energy companies, like many heavy industries, were very male-oriented, very macho environments,” said Valerie Newell, chairman and managing director of Riverpoint Capital Management Inc. in Cincinnati, who supervised Good at her first accounting job at Arthur Andersen LLP. “It’s important to make sure you are very technically competent.”
Good has been CFO for Duke since July 2009, after serving in that role at Cinergy, an Ohio-based utility that Duke acquired in 2006. She has followed Jim Rogers, who was chairman and CEO of Cinergy and took on those roles at Duke. She will succeed Rogers next month as he steps down.
In her new role, her base salary will be $1.2 million and she can make $8.1 million if she meets short- and long-term corporate targets in her first year. Good made $3.09 million last year and Rogers was paid $8.73 million in total compensation.
Rogers agreed to step down as chairman and CEO by the end of the year as part of a settlement with North Carolina regulators investigating a leadership change hours after the Charlotte, North Carolina-based company bought Progress Energy. An independent board member will be chosen as the next chairman, the company said yesterday.
“It’s more challenging when it is a male-dominated industry like energy, which makes her and this accomplishment so unbelievably remarkable,” said Newell.
Good was among the first women at Arthur Andersen assigned to audit a Cincinnati-based utility that Duke later bought, Newell said. “She just kept climbing the ladder.”
The mother of two teenage sons, who counts golfing and travel among her hobbies, Good said her role at Duke was never just about reporting the numbers and financing the company. Instead, she helped integrate Duke’s financial, operational and strategic objectives.
“If you think through all the priorities of Duke over the past 12-to-24 months, I’ve been involved with all of them,” said Good.
Good joins Sempra Energy (SRE) Chairman and CEO Debra Reed on the short list of female energy company leaders on the S&P index, which has 74 energy-related businesses.
“I’ve spent my entire 35-year career in the energy industry and early on I had few role models,” Reed said. “But I believe the old paradigm is changing.”
Women are running several smaller U.S. utilities that aren’t part of the index, including PNM Resources Inc., Alliant Energy Corp. and Hawaiian Electric Industries Inc.
Utilities may have advanced women to CEO roles more rapidly than other industries because as regulated monopolies, they tended to face government pressure for diversity among directors, said Ilene H. Lang, chief executive officer of Catalyst Inc. a New York-based advisory company for women business leaders.
Women account for 23 percent of utility CEOs in the Fortune 1000, according to data compiled by Catalyst. That compares with 4.3 percent among all companies, Lang said.
“This is the new normal,” Lang said of Good’s promotion. “It’s not your father’s energy company anymore.”
Forbes Magazine’s annual ranking of powerful women has only one from the energy field, Maria das Gracas Foster, who was appointed the head of state-controlled Petroleo Brasileiro SA last year. Lynn Elsenhans, the former CEO of Sunoco Inc., fell off the list after leaving the company last year.
Ginni Rometty, who ranks 12th on the current Forbes powerful women list, became chairman and CEO of International Business Machines Corp. last year. Her appointment prompted questions about whether she would be invited to join Augusta National, located in Augusta, Georgia, which has historically asked the CEO of IBM to join its ranks.
The first two female members invited were Condoleezza Rice and Darla Moore, the club’s chairman said in August. The club declined to comment on its membership yesterday.