Gender Diversity in the Boardroom Helps Companies Thrive
By Nancy Sheppard
The move to improve gender diversity on corporate boards is growing. One of the major reasons for this trend is that a growing body of research has demonstrated a positive link between a company’s performance and the proportion of women serving on its governing body.
Some of our nation’s most respected business icons see the benefits. As Warren Buffett said in 2013, “We’ve seen what can be accomplished when we use 50% of our human capacity.” He was referring to women, but if you add the number of talented minorities that aren’t being tapped, it’s more than 50 percent.
Worldwide, a number of countries (beginning with Norway in 2008 with Germany as the most recent in March, 2015) have instituted quotas requiring that a percentage of women sit on public company boards.
Could serving on a corporate board of directors be in YOUR future?
You may not be prepared today for a corporate board seat, but if the idea of helping to steer the direction of the thousands of private and public companies throughout the world intrigues you, you might consider evaluating your career progression in a manner that will assist you in becoming a viable candidate. Boards are increasingly looking at diversity including age, gender, and ethnic backgrounds as part of their evaluation process. Any one of these could serve to your advantage as you consider your options for joining a corporate board.
Board service can be very rewarding, as you usually work closely with a small group of people who come from a variety of backgrounds. It often provides a continual learning process addressing key business issues. Most boards provide financial compensation for directors ranging from a small amount of stock for start-ups to six figures for large Fortune 500 boards. If you are on any board, there are risks that must be considered, and making sure that the company (or nonprofit for that matter) has sufficient Directors & Officers insurance is highly recommended.
Here are some questions a candidate should consider to determine if he or she is ready for board service:
- Are you generally knowledgeable about the fiduciary requirements and roles of a board member?
- Are you comfortable understanding financial statements?
- Do you have a minimum of 10-15 years recent experience in a senior leadership or executive role?
- Can you clearly articulate your value proposition to a board?
- Will your schedule allow at least 30 hours per quarter to devote to your board work?
- Can you provide at least two recommendations from senior executives or board members supporting your candidacy for a board position?
- Have you had direct profit and loss responsibility and/or do you have experience in areas that are especially important in our changing world such as risk management, international markets, mergers & acquisitions, social media, big data, etc.?
- Can you be designated a ‘Financial Expert’, such as a CPA?
- Are you in this for something other than the “money”?
- Will you have the support of your own board of directors and/or your management to serve on a board?
- Do you like to ask deep, thoughtful questions about assumptions for business decisions?
- Are you comfortable with playing the director oversight role vs. the management role?
- Do you look for innovative ways to approach issues?
- Can you, and do you, question the conventional wisdom?
- Is strategic thinking a part of your business DNA?
- Are you a proven team player with an understanding that dynamics of a board is one of the most important parts of good governance?
- Will your background check be clear of any concerns for the company?
When you can answer “Yes” to all of the above questions, you may have the skills, experience, and time which are expected for a director position.
At Women2Boards, we encourage successful women business leaders, as well as emerging leaders, to explore the idea of board service. Most of our members have served on nonprofit boards and see corporate boards as a next step in their career progression. We guide women in the process of gaining a board seat, provide governance education and encourage them to gain additional business experience -- if needed -- that will improve their opportunities to be asked to serve. We provide a registry of ‘Board-ready Women’ so corporations can look beyond their own networks to find gender diverse candidates that have the skills and experience they want for their board.
Nancy Sheppard founded Women2Boards in 2014 as a way to assist both corporate boards and women connect and improve gender diversity. After more than 20 years as the CEO of a membership organization providing educational programs for community bank directors throughout the Western U.S. We have a nonprofit affiliation with a (501)(c)(3) fiscal sponsor.