Feb 22 2011
As discussed at the London HOO meeting, a report by the Financial Times suggested that the UK government-sponsored inquiry into board diversity led by Lord Davies of Abersoch will not look to impose quotas for FTSE companies. Instead, the report says, boards may be given a two-year timeframe in which to meet a common minimum target – expected to be between 15 per cent and 30 per cent – to speed up the inclusion of more women on the boards of the UK’s largest companies.
A move mimicking Norway’s initial approach of avoiding government leglislation, but not going far enough for some.
Quotas Versus Targets
Lynda Gratton from the FT argues for the imposition of quotas, stating that while the first wave of women may suffer, future generations will see more women at the top, spurring aspiration and providing a plethora of role models and mentors.
In a counter argument, Catherine Hakim sees board gender quotas as the latest 'fantasy' bandwagon, stating any success in getting more women on boards does not trickle down to the rest of society, instead it is ‘purely symbolic’.
Gender Diversity and Performance
Hakim attacks the one argument that might convince corporations to take a proactive step in the right direction - performance, claiming that since Norway’s achievements 5 years ago there has been no evidence that gender equality has spurred greater performance.
For such a judgement, one would need to study the board dynamics and performance, before and after – including soft dynamics as well as figures. Thus, I am sceptical for her claim - you cannot prove gains without a standard. For this reason, more rigid board performance benchmarking would help - without more effort in this direction we will never be able to judge positive results.
Contrary to the above claim, McKinsey worked to prove the positive effects of gender equality as the board composition and corporate performance consultancy demonstrated mixed gender boards outperform their all-male counterparts. A mantra that has been purported by many experts and professionals long before.
[Read McKinsey's 'Women Matter' reseach]
Women Are Their Own Worst Enemies
We have all heard the arguments for why women have not reached the top, from low self-esteem to pro-creation. And these arguments carry heavy public opinion weight; 27% of senior executives answered Yes to FT’s question ‘Are women their own worst enemies when it comes to achieving diversity in the boardroom?’ 92% of respondants were women.
However, as demonstrated in McKinsey’s recommendation, it is no longer the time to shrug off gender inequality as a gender trait or an inheritance from the historically male dominated workplace that just needs time. Quotas will only solve a fraction of the problem. In this respect, Hakim's polemic serves a purpose - organizations must lead in change. But if they won't (clearly failed so far) perhaps it is time for the government to give them a push in the right direction - a serious threat would get results alone.
Here are McKinsey’s five recommendations for improving equality at the top. Make sure you read the full report for context.
1. Create transparency by Implementing gender diversity KPIs
2. Implement measures to facilitate the work/life balance
a. Flexible working hours
b. Career flexibility
3. Adapt the human resources management process
4. Help women master the dominant codes, nurture their ambition
This article was written by Christian Pielow from the Association of Executive Search Consultants (AESC).
BlueSteps is the exclusive service of the AESC that puts senior executives on the radar screen of over 6,000 executive search professionals in over 70 countries. Be visible, and be considered for up to 50,000 opportunities handled by AESC search firms every year. Find out more at www.BlueSteps.com.