When it comes to women on boards, the National Association of Corporate Directors (NACD) has come a long way, Baby, to quote an old TV ad for the Virginia Slims. The first issue of NACD’s original newsletter, Director’s Monthly, featured a Board of the Month – first American Savings and Loan. The board’s photo shows 15 directors, all apparently white males. This kind of board composition was commonplace in the late 1970s, and NACD’s membership reflected this fact. Flash forward to the present day, when most boards have diversity and the picture looks as quaint as a TV ad for smokes. How can a board grow in diversity? Here is the story from NACD, expressed as lessons learned for boards and for the individuals who seek to join them.
Women on Boards: Seven Lessons from the NACD Experience
In the 2014 annual meeting season, when shareholders have “face time” with their boards, they may ask about the faces they don’t see. Only 16.6 percent of board seats in the Fortune 500 are held by women, according to a recent report from the Alliance for Board Diversity. Picture it: that’s just two women on a 12-member board, and only one on a six-member board. And although women are fairly likely to lead the audit or nominating committee, with about a one in five chance of leading those, says the Alliance, they are less often seen chairing the compensation committee chair or assuming the role of lead director or board chair, where the odds of their leadership are only one in ten.
Preliminary results from the 2013-2014 Public Company Governance Survey of the National Association of Corporate Directors (NACD) shows that 73.3 percent of boards report having at least one woman—with more than half of these having more than one woman, a new and encouraging development. Such progress may keep mandatory diversity quotas mandatory diversity quotas at bay.
Still that leaves one out of four boards today in an all-male milieu. That’s one reason NACD maintains a Director's Registry with more than 6,000 candidates who have the option of self-identifying by gender and/or race. Nominating committees can specify not only the credentials and experience they seek, but can ask DR staff to be sure to include qualified candidates who have self-identified as women and/or as belonging to a particular demographic group.
Every public company director today had a first board. Those who wish to follow in their footsteps can take certain actions. If you are reading this as a woman seeking a board seat, this advice is especially for you!
1) Start by serving on the board of a local nonprofit.
2) Network with other directors as a peer.
3) Seek education that will prepare you to succeed in the boardroom.
4) Prepare a resume that highlights your board-related value.
5) Put your resume on a director registry so boards can find you.
6) Continue to read about issues of relevance in the boardroom.
7) Be inspired by examples of females who have served on boards before you.
NACD can help aspiring female directors and others all of these steps, including the last. NACD’s board has always been diverse and so has its leadership. Of the nine chairs we have had in our nearly four decades, three have been women. The current NACD board chair is Reatha Clark King, who succeeded Hon. Barbara Hackman Franklin. Both King and Franklin have been advocates for board diversity. King co-chaired the 2012 NACD Blue Ribbon Commission on Board Diversity, and Franklin is known for her work in recruiting women to leadership positions in the Nixon Administration, as recently chronicled in the book, A Matter of Simple Justice (University of Pennsylvania Press, 2012).
Their female predecessor in chairmanship, Jean Head Sisco, speaking as NACD chair in 1992, predicted a greater presence of women on boards nationwide as early as 1992. "I can assure you that on the boards that I sit on, on the boards that many of our members sit on, that you're seeing a great surge for greater diversity in the selection process," she told a Philadelphia Inquirer reporter headlining an “old boys club.” Today NACD is ahead of the diversity curve.
How did we do it? NACD founders sought highly successful individuals known to them through professional circles. Then, one woman at a time, one place at a time, NACD became a sterling example of gender diversity. To name just a few examples of NACD’s pioneering choices, the Association selected Juanita Kreps as its first Director of the Year (DOY) in 1987; she would be the first of many future female DOY honorees. Pioneer Sisco chaired the first NACD Blue Ribbon Commission (on executive compensation in 1993), and paved the way for many other women to chair Commissions. Of 19 so far, nine have been chaired or co-chaired by women. When Franklin turned the chairmanship over to King this year, a formal resolution—jointly penned and signed by all board members—commended Franklin’s“outstanding service over many years on several major corporate boards, thus setting an example for others to add more women directors.” In short, one good woman led to many. What are you waiting for?