Extreme Make-Over: Corporate Board Edition
By Rosa Cho, Writer & Researcher
The recent jaw-dropping statement by Twitter’s CEO Dick Costolo proclaiming that he has a difficult time filling out the board seats with qualified female members sounds so retro. Harvard Law school circa 1992, anyone? According to numerous industry observers and experts, the absence of women is likely more about Costolo’s lazy due diligence as a CEO, even if the tech industry is an especially difficult field for women to penetrate.
But if you shift the lens from one particular industry to the larger global picture, all is not completely lost. Increasing numbers of women are and have been making their presence felt in the high-power C-suite circles worldwide. Comprised of more than 2,500 women corporate leaders, WomenCorporateDirectors (WCD), a global membership organization of women corporate directors, asserts that the aggregate market value of the companies its members serve as board members would total almost $8 trillion. Norway, a poster child country in regards to successfully increasing women in boardrooms, was the first country to adapt board gender quotas in 2005 and now prides itself in having 40.9% of their corporation board seats held by women.
The thing is, some of these changes took place because there was a social and political will to create and implement regulations and to induce—even if artificially—increases in representation of women in high-power positions in the business world. We cannot expect individual board members to voluntarily open up positions and mentor and nurture people who are outside of the ol’ boys’ network. We have tried that ever since the corporations have been in existence, and this has not worked. Further, researchers tell us that, although numerous women leaders have been employing innovative means to make it to the top, they feel that mentorship and cultivating nurturing relationships with insiders is incredibly helpful, but seriously lacking for women business leaders.
One way to make these things happen is through shareholder activism and empowering everyday customers of these large corporations to voice their opinions for change, be socially conscious and responsible, and be the leaders in undoing inequalities in their boardrooms. For the most part, regular everyday people have no concept of what it’s like to deal with millions or billions of company dollars or to determine what nebulous, amorphous characteristics qualifying one to hold corporate board or CEO positions.
What is apparent for many average citizens, though, is that despite the apparently highly selective, coveted nature of those high-power positions, many of who end up in them mess up—to put it mildly. Their decisions, largely made behind the closed boardroom doors, contribute in no small part to global economic meltdowns and recessions. Part of the problem is that within a like-minded, demographically (and thus experientially) homogenous group, there is bound to be groupthink and the stale and ineffective problem-solving it generates. In order for any organization to thrive, it needs diverse viewpoints. This is precisely what many corporations boardrooms lack. Increasing shareholder activism that demands change is one possible approach to solving this intractable boardroom diversity problem.
Women’s economic power is increasing as they control more consumer dollars. Globally, women’s earning power is predicted to reach $18 trillion by 2014—a force to be reckoned with, given that that is more than twice the estimates of GDP of India and China combined. Despite this growing buyer power of women, the market is filled with products and services with women-unfriendly designs. If companies want to attract female customers, their top leadership positions must have a serious make-over and fill them with people who can understand big portions of growing consumers who are not men and produce goods and services that cater to people who have been un/der-represented and marginalized as consumers—such as women, racial/ethnic minorities, LGBT communities, young and old people, differently-able-bodied people, to name a few. The world is transforming rapidly, and it is about time corporate boardrooms reflect some of these changes.