As countries around the world set targets to increase the number of women directors in public companies, new research suggests that meeting those goals might be complicated by the fact that male and female board members do not agree on whether board diversity will improve a board’s performance.
According to the research, women and men on corporate boards disagree on the need for quotas and the reasons why fewer women are represented on boards, and whether or not a diverse board matters for good corporate governance.
The research, conducted by Heidrick & Struggles, the executive recruitment group, Women Corporate Directors, an organization made up of women who serve on boards, and Boris Groysberg of the Harvard Business School, was based on survey responses from 721 male and female board members in 26 countries.
Quotas appear to be a particularly divisive topic. Just 13 per cent of men surveyed personally supported quotas; and even among women, the figure was only 41 per cent.
Similarly, while more than half of women (53 per cent) thought quotas were an effective way of increasing board diversity, just 18 per cent of men agreed.
I spoke to Bonnie Gwin, vice-chairwoman and managing partner of Heidrick & Struggles’ North American Board of directors practice, about the findings. She told me:
“One thing that struck me is the increasing percentage of women who seem to support quotas. That is not what I hear when I speak with board members, but it seems as though a number of women are beginning to think that quotas are something to consider. It may be because quotas are part of the dialogue in countries like Norway, France, Spain, and the UK. In the US, they are not part of dialogue about what makes a great board.”
About a third of women directors believe closed-off traditional networks are the main reason more women aren’t considered for director positions. Men, on the other hand, tens to believe that the fact there are fewer women currently in executive leadership roles creates a smaller talent pipeline for entrance into the board room.
Gwin says that one way to remedy this is for companies to “look beyond the CEO level” when they are identifying and recruiting possible board members.
Men and women also hold disparate views on whether increasing the number of women in the boardroom will improve overall board performance.
More than half (55 per cent) of female directors say that three or more women on any board make it a more effective board. Yet only 16 per cent of male directors agree with this. Gwin says this sentiment may have to do with “outside forces dictating” how companies compose their boards.
About three quarters – 76 per cent – of women also believe increased board diversity will be effective in rebuilding trust in boards. This compared with less than half – 42 per cent – of men surveyed.
“In my opinion, diversity of boards is simple: it is good for business. It is a competitive advantage to have a lot of life experiences around the table.”