Why Our Efforts to Get More Women on Boards Aren’t Going Far Enough
Mary Karen Wills
Women are rising, but we’re a long way from gender parity
California lawmakers drew national attention—and criticism—last year by passing a law that will essentially require certain companies in the state to appoint a whopping 684 women to corporate boards by 2021.
Senate Bill 826’s backers equated the move with breaking a glass ceiling—and pointed to simple arithmetic: women hold just 15.5 percent of board seats at Russell 3000 companies in California, compared to 16.2 percent among all the companies in that index. “It’s high time that corporate boards include the people that constitute more than half the ‘persons’ in America,” Governor Jerry Brown said at the time.
Wherever you stand on the California law, which faces inevitable court battles and is especially controversial in California’s male-dominated tech sector, its passage should prompt anyone who cares about gender parity in corporate leadership to ask a tough question:
If after years of initiatives and good-faith efforts, boardrooms are still dominated by men, then what, aside from laws and mandates, can be done to level the playing field? Perhaps the answer starts with getting more women into the C-suite and onto board recruiters’ radars. And as women, we can help populate those databases with purposeful networking and forceful advocacy on the boards we’re already on.
Progress, to a point
We’ve made some progress. Women received 40 percent of board appointments in 2018 compared with 18 percent in 2009, according to a recent report by Heidrick & Struggles. That trajectory would lead to gender parity in appointments, not seats, by 2023, the report found. But other numbers aren’t as promising. A report published last year by the Alliance for Board Diversity (ABD), in collaboration with Deloitte, found that women held only 22.5 percent of Fortune 500 board seats.
Larger companies appear to be doing a bit better; those with a market capitalization of $5 billion or more appointed to boards 57 women and just 19 men during a six-month period in 2018. But The Washington Post in January 2019 expressed skepticism, noting that diverse boards are often “a smokescreen” to conceal the lack of diversity in the C-suite. Indeed, women hold just 25 percent of C-suite positions at some of the largest companies in the US, according to a Korn Ferry analysis in April 2019.
Clearly, whether it’s in the C-suite or the board room, there’s much work to be done.
Looking differently for qualified candidates
Indeed, the issues of women on boards and in C-suites are very much related; to even qualify for many boards, candidates often must have C-level experience. That means more men have the experience deemed necessary—and the problem too often becomes a vicious circle. Some diversity advocates have suggested loosening the C-suite experience requirement. Companies might “need to look at a broader set of industry experiences, C-suite roles, backgrounds, and skills for potential board candidates,” according to the report from the ABD and Deloitte.
While that point is valid for many reasons, Deloitte made it specifically regarding high “recycle rates” for women and minorities, in which “boards more frequently will pull from a pool of existing minority board members instead of bringing new directors in.”
One solution to address the recycle rate issue and gender parity more broadly is to create better, more searchable resources. If a company wants to look beyond its own LinkedIn networks for qualified candidates, only disparate resources—essentially databases from member organizations with varying missions—exist. Sometimes companies turn to headhunting firms, which have more comprehensive lists, but those are often filled with men, too. The few women on the headhunters’ lists then tend to be recruited for boards over and over—thus, the recycling-rate problem.
One isn’t enough
Under California’s law, affected companies face a $300,000 fine if they don’t have at least one women on their boards by the end of 2019. But that’s just the beginning. Companies with five total directors must have two women on their boards by 2021, and for companies with six or more directors, at least three must be women.
Credit to the California lawmakers here, as research has found that appointing only one woman to a board can be as ineffective as appointing none. In fact, a 2006 report about women on corporate boards said the appropriate number of women on each board is actually three. “Increasing the number of women to three or more enhances the likelihood that women’s voices and ideas are heard and that boardroom dynamics change substantially,” the report said.
That report’s authors noted that women who served as the lone board representatives often reported “not being listened to, being excluded from socializing and even from some decision-making discussions, being made to feel their views represent a ‘woman’s point of view,’ and being subject to inappropriate behaviors that indicate male directors notice their gender more than their individual contributions.”
Women helping women
If we’re going to support those female directors, let alone achieve gender parity on boards, we have to embrace not only all of the above, but also a simple, crucial idea: women must find more ways to help other women.
When a woman is ready to leave a board seat, her first thought should be, “Let’s make sure another woman gets this spot.” And when a board seat opens up, women board members should push to find the right woman for the job. That’s more easily done if women on boards know of other qualified candidates, which is why networking events, like BRG’s Women’s Leadership Conference this October, are so important. There are opportunities for women who’ve made it to boards and C-suites to pass on what they’ve learned.
Victoria Medvec, for example, has learned that it’s critical for a board candidate to broadcast “the unique value she brings to a board.” In a 2018 KelloggInsight article, Medvec, the Adeline Barry Davee Professor of Management and Organizations at Kellogg School of Management, relayed a story of a qualified woman who had repeatedly failed to land a board seat. She “realized she needed to reach out strategically to an even broader range of people to communicate the value she could bring to particular types of boards and seek their advice,” Medvec wrote.
That realization led her to board seats at companies she admired. It’s the kind of story we need more of, both from a statistical perspective and as a way to develop and share best practices.
This is not to say that gender parity is women’s problem to fix. Corporate boards and leaders created this problem and need to do their share to help fix it. But with lawmakers poised to impose gender diversity on a corporate sector that has yet to take the necessary steps to allow more women into board rooms, this is an important moment. We should make the most of it.