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The 'Risk Tax' and 'Punishment Tax' Could Be Derailing Women's Careers. Here's How to Recognize — and Avoid — Them in Your Organization. Dr. Yasmene Mumby, a sustainable leadership advisor and founder of The Ringgold, explains how women, particularly those of color, are held to different standards at work — and what we can do to change that.

By Amanda Breen

Key Takeaways

  • Women whose job performance was rated higher than men's were judged as having less leadership potential.
  • The "risk tax" and "punishment tax" mean women must take risks to stand out at work — then face negative consequences in some cases.
  • Determining how widespread discriminatory practices are is the first step toward addressing them effectively.
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It's no secret that women often have to go above and beyond to prove themselves in professional settings where male colleagues don't face the same level of scrutiny.

In fact, one recent study found that women whose job performance was rated higher than men's were judged as having less leadership potential than their male counterparts, per Yale Insights.

Women, especially women of color, have to take more risks in the workplace to secure top leadership positions — but doing so can have some seriously negative consequences, Dr. Yasmene Mumby, a sustainable leadership advisor and founder of consulting company The Ringgold, tells Entrepreneur.

Women have to demonstrate their abilities to a greater extent than men just to access the same opportunities, essentially facing a "risk tax" in the workplace. "This is a calculation that many leaders who identify as women have to make on a daily basis to not be ignored," Mumby says.

But a "punishment tax" is often levied when women do take those risks to stand out. Many women face steeper penalties for the decisions they make as leaders with high visibility than men in the same position do, Mumby explains.

Related: 6 Ways to Better Support Women in the Workplace | Entrepreneur

The research bears it out: A Harvard Business School study found that female financial advisors are 20% more likely to be fired for misconduct compared to men, and another from the University of Alabama revealed that female CEOs are 45% more likely to be fired, per the World Economic Forum.

"Workplace culture is made in the 10-15 second interactions colleagues have over conversation."

Why do women have to navigate these issues today? "It's a ripple effect of the tenor of this country," Mumby says.

"We have not come from underneath the systematic discrimination and withholding of opportunity of people who have been historically marginalized and underrepresented in American society, namely people of color and women," she explains.

The result is a "blistering combination" of racism and sexism at work, Mumby says, and the onus is on us to spot the signs and take the steps required to change course.

First, pay attention to the language used to describe women and women of color in the workplace, Mumby suggests — whether it's written in an annual review or verbalized at the end of a presentation. For example, are questions being asked in a "less curious and more accusatory tone?"

"Workplace culture is made in the 10-15 second interactions colleagues have over conversation," Mumby says.

Related: Sexism in Tech Is Dying: Are You Still Part of the Problem?

When it's clear discrimination in the workplace is unfolding, Mumby suggests asking an important question: Is it a single individual who's attacking and/or undermining their colleagues, or is it a series of individuals?

If the problem is limited to one individual, it can be dealt with via HR: Perhaps policies or practices might be tweaked to mitigate the issue, Mumby says.

But if several people are exhibiting discriminatory behavior, the workplace "is dripping with implicit racial and gendered bias" — and a more comprehensive approach is necessary.

"Studies show you can't have a one-off training; it needs to be cyclical."

"Then it's a pattern of behavior, of action, of language being used," Mumby says. "That's a concern. So then you have to look at an organizational-wide initiative to solve it. I've seen organizations work towards this through a multi-pronged approach, [including] overarching trainings. Studies show you can't have a one-off training; it needs to be cyclical."

According to Mumby, trainings must be coupled with individual coaching and observations that occur at unknown intervals with consent — because what people say in a coaching session can be "wildly incongruent" with how they actually behave in the workplace.

"People like to perform when there's an event," Mumby explains. "They're not necessarily their genuine selves. So it's got to be sustained intervention that includes training at intervals throughout the year coupled with leadership coaching and sessions in a non-evaluative space, where people can have room to unpack their leadership actions and not be punished."

Related: 4 Strategies to Empower Women in the Workplace | Entrepreneur

Holding people accountable is key too, Mumby says, noting that those who undermine their colleagues should be called out "with compassion," in public and in private. It's also important to document recurring patterns.

"You need to bring what is implicit, explicit."

And for women in the workplace who feel the "risk" and/or "punishment" tax being levied on them? Mumby has a couple of suggestions.

"If you are in an environment where the treatment is such that your inner brilliance, light, confidence, well-being and mental health are being compromised, it is time to go," she stresses. "I am a proponent for prioritizing one's self-worth, one's well-being and one's brilliance, and if you are in a situation where that is being chipped away and weakened, undermined, I cannot say in good conscience stay."

But if you have the "emotional bandwidth" to manage such a situation, observe who's perpetrating the behaviors — and document all of your interactions with them, Mumby says.

Related: 10 Working Women Pioneers Who Changed the World for Good

"Do not have any isolated conversations, interactions, work, collaborations with this person separately because then it becomes your word against theirs," Mumby explains. "You need to bring what is implicit, explicit — out so that people can see this is a sector of our culture that we don't want, and this is the impact of this person's actions. Once you bring the implicit explicit, you go to HR."

Amanda Breen

Entrepreneur Staff

Senior Features Writer

Amanda Breen is a senior features writer at Entrepreneur.com. She is a graduate of Barnard College and received an MFA in writing at Columbia University, where she was a news fellow for the School of the Arts.

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