Originally published December 2014
Gender diversity is clearly an important topic in the corporate governance arena. I would even venture to say that never before has the issue of women in the boardroom or the lack thereof been more focused on. We are no longer discussing whether gender diversity makes sense or is desirable, this has been confirmed and proven over and over again. Now, the debate has moved onto the “how.” How do we make it happen? How do we get more women onto more boards? Not because of some handout or some quota but because they are well qualified and will make contributions that will improve the functioning of the companies which they serve.
This dialogue usually goes hand in hand with another about who is qualified to sit on a board and what do boards look for in terms of experience. There are all kinds of commentary and information out there about which skills and experience translate best into board nominations. As the issue of gender diversity gains traction so does the request for guidance and information as to what it takes to gain entry into the boardroom.
To achieve some clarity on this issue and debunk the myths, I decided to do some informal and certainly not statistically significant research. I looked at women appointed to public company boards over the past year and came up with a sample of twenty such circumstances. Again, these are public companies of a variety of sizes and not completely reflective of the many private, venture and non-profit appointments that occur daily. Nevertheless, I then looked at the backgrounds of these women. Not surprisingly, twelve of the 20 women appointed to these boards were, or had previously been, CEOs, division presidents or General Managers. In other words, they had profit and loss (P&L) experience, were line managers and presumably know how to run businesses in their entirety. This is not surprising since the role of board director, by definition, necessitates understanding and making decisions about companies at their most comprehensive and strategic level.
The other eight women in my sample had somewhat diverse backgrounds and experience which will be encouraging to all of you non-CEOs interested in serving on a board. There were two Chief Financial Officers, a former career Consultant (from McKinsey), a Chief Marketing Officer, a General Counsel, a former Audit Partner, a business school Dean and a Chief Information Officer. This is clearly a broad assemblage and indicates what should already be widely-known. That is, the best boards are made up of diversity, not only in gender and ethnicity but in experience, qualifications and background.
Another dimension that merits mention alludes to the question of whether one needs prior board experience to get onto a public company board. This is so often the question that is asked amongst women seeking a board role. My assumption on this issue was confirmed in this sample of 20 appointments. Specifically, at least as far as public company boards go, prior board experience is highly desirable. Nineteen of the 20 women I investigated had prior board experience that ranged from public company to private and non-profit. Alas, the message is clear, “start small.”
Once again, I reiterate that this is simply a glimpse into the complex world of board appointments. But twenty public company nominations can still provide valuable ideas and insight. Bottom line, the news is encouraging and not very surprising. There are a variety of career paths into the boardroom although for the time being, it still seems preferable to acquire operating experience if at all possible. And, more often than not, best to start your board director career with a private or non-profit stint.
For those interested the specifics of the 20 appointments in my sample, please contact me.