Hello readers! I am currently on my maternity leave spending some quality time with my family! Enjoy this guest post from today’s featured author!
The following is a guest post by David Morrison. Morrison grew up in Australia. He eventually acquired a PhD degree in plant biology, during which he became interested in wine. He started visiting wineries throughout Australia, just at the time when high-quality wineries were beginning to boom. Somewhere along the line he moved to Sweden, and in his semi-retirement he runs a blog called The Wine Gourd (winegourd.blogspot.com). In the interests of doing something different to every other wine blogger, this blog delves into the world of wine data, instead. He is particularly interested in the relationship of wine quality to price, and quantifying value-for-money wines.
The Academic Wino tends to stick to the natural sciences, only occasionally drifting into the social sciences, broadly defined. However, this does not mean that the latter is less important, but merely that there are fewer studies worth discussing.
One of the main issues is that academic studies in the social sciences are restricted by the common inability to do manipulative experiments on the behavior of human beings. Such experiments are generally illegal, immoral and impractical. This means that most of the research involves descriptive studies, where the researchers try to extract some meaning from whatever data they can collect. This tends to limit the generality of any conclusions.
Still, the topics themselves are always interesting, and worth investigating. One that might be of interest in this blog is gender differences in the running of wine businesses. The world is full of blatant gender biases, of course, although many people do not notice that they can occur in both directions. For example, at the university I worked at in Australia, the most gender-biased part of the bureaucracy was actually the Equal Opportunity Office, whose staff consisted solely of females, while the most gender-biased part of the academic staff was the Faculty of Nursing, which also consisted solely of females. Even the mathematics and engineering faculties had staff of both genders!
Gender biases can affect people in all sorts of ways. At that same university, I was asked to be the chairperson of the committee trying to set up child-care facilities at my local campus. I was asked because the rest of the committee members were all junior female staff, and they thought that this might be a bad combination if you wanted your voice to be heard by the university bureaucracy. I have no idea whether their concerns were justified in practice, but the possibility seemed real enough for me (a senior male) to agree, and to make sure that we were heard.
The point of those anecdotes is that any one social characteristic is unlikely to be of over-riding importance on its own. It is combinations of characteristics that have the big effects; and this is where gender can come into play (if it is going to) — gender on its own is not the key thing, but rather gender in combination with other social characteristics. This is an important point if we wish to reduce any given gender bias — gender may be only half the battle.
There seems to be very little literature about gender bias specifically related to the wine industry. There are plenty of studies about gender differences among wine drinkers (eg. International study examines gender differences in wine attitudes: confidence in wine knowledge, and opinions of sustainable wines), but that is another topic altogether. There are, however, a couple of industry-related articles that seem to be both relevant and interesting. In both cases, the authors show that gender biases do not exist in isolation.
Women in Senior Company Positions
Let’s start with this one:
Jeremy Galbreath (2015) A study of women in top business roles: the case of the wine industry. International Journal of Wine Business Research 27:143-158.
Many professions show little gender bias, the biological sciences being a well-known one. But even in these cases, it has long been recognized that gender bias may be at its greatest in any sort of organizational hierarchy, with male bias increasing in the senior positions. There is no reason to expect the wine industry to be an exception to this; and this is the subject of the first paper:
“…to empirically explore the extent to which women are advancing in the wine industry, and whether there are conditions which help facilitate their advancement. There is a perception that women are making great strides in the wine industry. However, this perception is largely anecdotal … One report goes as far as to say that women in top roles in the wine industry, such as winemaking, now constitute at least a 15 per cent representation rate, well above rates in top roles in other industries. This has led some to suggest that the wine industry, given its history of male dominance, has undergone significant cultural and structural change when it comes to gender representation in top roles … [My] study seeks to challenge the current estimated rate of the representation of women in top roles in the wine industry, while examining factors that predict women representation rates in these roles.”
Now, let’s face it, 15% may be better than the average, but it is still pretty low, at least compared to the 51% that women make up of the general population. One factor that the author notes from previous studies is that:
“…a male-dominated hierarchy exists, particularly in upper-level positions. The interviewees expressed views that within the organization, the ideal worker is conceived of as “masculine”. This includes, for example, the need to work long hours, to demonstrate commitment to the organization ahead of social or family responsibilities, to adhere to cultural norms such as golf days and watching football, and to have the physical strength required for heavy lifting and using machinery.”
Rather than the previous type of interview-based approach, the basic idea of this first study was to use an industry-compiled database from Australia and New Zealand:
“Data were collected from the annual Winetitles Australia and New Zealand Wine Industry Directory database, in each year for the years 2007-2013. Updated on a yearly basis, the Winetitles directory is the most comprehensive guide to wine producers in Australia, where a wide variety of detailed data is collected annually, including variables of interest such as regional location and names of key personnel.”
Over the 7 years of data, there were 2,145–2,574 firms listed (mostly wineries). The number of females in four key roles were counted, and their percentages then calculated: Chief Executive Officer (CEO), Winemaker, Viticulturist, and Marketer. Three variables were examined as factors that might influence these percentages: the age of the firm (ie. years), the size of the firm (ie. the wine number of cases produced per year), and the firm’s export orientation (ie. the percentage of sales as exports). The latter three were converted to categorical variables for analysis (1-6, 1-5 and 1-5, respectively).
The percentage of women in the four roles hardly changed at all across the 7 years — CEO: 12.7%, winemaker: 8.8%, viticulturist: 10.0%, and marketer: 53.5%. So much for the anecdotal evidence of 15% gender representation (except in marketing) and significant cultural and structural change, at least as far as Australia and New Zealand are concerned. The only other data quoted by the author is 9.8% women winemakers in California, which is not much different.
It is interesting to note that the representation rate is higher for the CEOs than for the winemakers and viticulturists, suggesting that there is considerable room for improvement in these two career paths. However, there was some evidence of a flow-on effect of the presence of women in the senior roles. For example, the presence of a female CEO in a firm was positively correlated with the concurrent presence of female winemakers and viticulturists (and to a lesser extent female marketers). This presumably means that the women, at least, are being proactive about gender bias, although there is some way to go. Mind you, the author does note that “across all agriculture industries, the current full-time employment rate of women is around 14 per cent”, which suggests that large changes in the wine industry cannot occur in isolation.
All of the correlations with the other factors were negative, so that increasing age, size and export focus of the firms were all related to fewer women in the key roles. That is, smaller and more recent firms have less gender bias in management, which is not particularly surprising.
Interestingly, at least some people in the wine industry seem to be proactively addressing this general issue. For example, there are a number of initiatives intended to address women as role models in the wine industry, notably the Australian Women in Wine Symposium and Awards (see The winners of the 2018 Australian Women in Wine Awards), and the Women in Wine New Zealand project (see Women in Wine mark first birthday).
As far as I can tell, this is still the only large-scale (ie. national) research study of women in the wine industry.
Women in Senior Family Positions
One acknowledged issue that was not addressed in the previous paper is that it “did not compare family-owned firms to other types of ownership structure.” That makes a more recent paper of particular interest:
Antonio D’Amato (2017) Do women perform better in family firms? Exploring the moderating role of family firm status. International Journal of Wine Business Research 29:299-315.
For this paper we move to the Campania region, in southern Italy, although the data cover roughly the same time period (2007-2014). We thus move from a national scale to a regional one, which is necessitated by the data collection — the required information would be hard to collect for an entire country. The paper has the ambitious:
“…aim of disentangling the relationship between female involvement and firm performance and shedding new light on this issue … [I] propose to analyze whether and to what extent the family firm status moderates the relationship between female involvement in top positions (as owners or board members) and firm performance. In fact, family firm status could be a beneficial condition for women, as women may face fewer obstacles in working for highly family-controlled firms.”
The data collection required accessing the information system of the local Chamber of Commerce plus the AIDA database of the Bureau van Dijk, to collect balance sheet data for the companies being sampled, as well as demographic information about the firms, and their owners and board members. Unfortunately, there was the commonly encountered problem of getting an unbiased sample. The author:
“…identified a population of 475 wine firms involved in the production of quality wines. Of these, 114 were corporations and thus represented the sample of interest. Twenty-six companies were excluded owing to difficulties encountered in acquiring all the necessary information. Specifically, some of these companies were either not yet operating or were in liquidation, and in a limited number of cases, the companies’ balance sheets were not accessible. The remaining 88 candidates were suitable for inclusion in [the] analysis … The data collection returned an unbalanced panel of 347 observations.”
The calculations involved estimating a series of key variables, including:
Company profitability = the ratio between EBITDA (earnings before interest, taxes, depreciation, and amortization) and capital employed;
Family power = percentage of capital held by the family + percentage of members on the board of directors from the family (scale is 0–2, lowest power to highest power)
Female involvement = percentage of equity held by female owners + percentage of female members who sit on the board (scale is 0–2, lowest involvement to highest involvement).
Also included were measurements of: firm age, firm size (ie. turnover), and debt / equity ratio. These were all combined via a linear panel model, in order to estimate the magnitude of each variable’s contribution to the overall Firm Performance.
The final sample of 88 firms were:
“…small, with an average age of approximately 12 years, financial leverage of approximately 70 per cent and a profitability rate of 6.6 per cent. Notably, the family power (FP) index is approximately 1.34 [2 = total family control]. This suggests that the sampled firms are highly family-controlled. This result is consistent with previous empirical evidence that highlights the prevalence of small and medium-sized family businesses in the Italian wine industry.”
In terms of Performance: (i) firms with less debt were more profitable; (ii) profitable firms tended to be older; and (iii) bigger firms generated more profit. None of this is unexpected. Furthermore:
“…female involvement is very low in our sample: the average value for this variable is approximately 0.5 [2 = total female leadership]. Therefore, female involvement in company leadership is still modest. Thus, we conclude that on average, the wine-producing firms in the Campania region are predominantly run by men.”
The key result, however, was the strong interaction detected between Female involvement and Family power:
“Compared to highly family-controlled firms, female involvement negatively impacts firm performance in low family-controlled firms. Practically, our results suggest that family firm status moderates the relationship between female involvement in company leadership and financial performance, such that family firms may mitigate the constraints on women’s work.”
In short, female leadership was less successful without strong family involvement, as shown in the accompanying figure. [see image below]
Given that this is a descriptive experiment, I emphasized above that we cannot attribute cause and effect when evaluating this interaction result. In particular, we cannot decide whether women are: (i) succeeding inside a family environment, or (ii) failing outside of that environment, or (iii) both. Are the challenges of a male-dominated environment hindering the performance of the women when they are alone? Are the women in family-run businesses matriarchs, who manage their family members differently to others? (The author notes that “59 per cent of these women leaders inherited the business from their family”.) Are the family members working together in a way such that the gender of the CEO is irrelevant in practice?
We don’t even know which questions to ask, let alone what the answers might be. Trying to answer any of them would be really hard.
Conclusion
Both of these papers illustrate the point I made at the beginning: gender issues do not exist in isolation. Wine-making is an agricultural pursuit, and it is unlikely to change independently of changes in the agriculture industry as a whole; and wine-making is often a family business, and it is unlikely to change independently of changes in business structures as a whole. The world would be an easier place to deal with if problems came singly, but probably also a more boring one.