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Progress has been slow in achieving greater gender diversity in executive board positions however, recently, there has been significant and successful growth in the appointment of female independent directors (IDs). There are more women on FTSE 350 boards than ever before with the representation of women more than doubling since 2011 – now 26.1% of FTSE 100 boards and 19.6%of FTSE 250 boards. I have personal experience of the appointment of three women to listed companies, each one being appointed on their merits to bring specific contributions to the boards.
One was appointed to Chair the Quality Committee of a medical devices business and made a very important contribution to the strategy and risk management of the company. A second was appointed to help the Board of an international construction business with its strategy and globalisation deliberations. She subsequently succeeded me as Chair of the Remuneration Committee. The third was appointed as Chair of the Audit Committee of a ports and property company and played an important part in the development of a comprehensive Risk Management strategy.
The significant business benefits to be gained by the appointment of independent minded women is currently either undervalued or lost to the detriment of business and other organisations. In my book The Independent Director, I seek to identify the good/positive characteristics of IDs which, I believe, are:
– Listening Skills
– Cultural flexibility
Good women IDs, in my experience, much more regularly bring all of these attributes to companies they work within than do male IDs. Though important contributors whatever the industry or business, there are also particular sectors where women can bring unique insights, including from being mothers e.g. Life Sciences, Education and in functions that involve (perceptive) career development such as Human Resources .There is also an increasing demand for women IDs to join the boards of a wide range of other organisations such as Universities, NHS Trusts, Housing Associations, Charities, Sports bodies etc. all of which present opportunities for the women involved and the boards they join. Currently, for example, only 20% of sports bodies IDs are women.
I have been on the panel of an FT Conference focused on increasing gender diversity and also the Professional Boards Forum which have given me a better insight into some of the issues which women face. These include:
– the attitude to parenting. If women are left to bring up the children whilst the husband goes to work then this can be a hurdle. However, in these days there is now much more sharing between parents, which can really help.
– being a single parent. This is an issue for men as well as women as I know from my personal experience when my wife died.
– The attitude of parents and teachers to the education of girls is fundamental. In our family we have three very successful daughters and I believe this is a reflection of their education.
– The practical issues of being away from home, especially overnights, and the demands of international travel. The family comes first and rightly so, but there is an inevitable conflict of priorities.
– The age of the children is also a very important issue since very young children and babies have very particular needs and demands from their mothers. However, as the children grow up, and with a strong support network, these demands and pressures on the working mum can be less. Clearly, if the children are disabled then this is another challenge.
For both men and women, companies can help with their policies and practices towards flexiworking, interim work, hot desking as well as by encouraging home-based working.
– The application of the latest technology can help so that board meetings now commonly use video conferencing to avoid the need to travel so much.
We need to educate and challenge senior managers to acknowledge, celebrate and embrace the strategic and governance skills of women so that they become agents for change. An example is to recruit senior men to be involved in mentoring, for example, European Women on Boards have approached me to help mentor Senior Women in business.
The Government should continue to encourage the need for more gender diversity e.g. the Theresa May/Vince Cable letter to FTSE companies setting out a strong business case for increasing representation of women to senior positions. It argued that statistics showed that companies with more women on boards outperform their rivals with a 42% higher return in sales, 66% higher return on invested capital and a 53% higher return on equity.
Leading Industry bodies such as The Institute of Directors (now with a female chair) and the CBI can continue to encourage and educate their members in this direction.
Search firms should be energised to play their part in ensuring that women get equal opportunity plus there should be more consistent and active interest from investors in this matter.
Business schools have an important part to play in educating senior managers and MBA students about the importance of and need for more gender equality on boards.
However, I am not convinced that quotas are the answer as all IDs should be appointed on their own merits irrespective of gender. I noted that, in a recent survey, working mums are split on boardroom targets.
Women do, however, need specific training and education to help them to succeed in becoming IDs. Elin Hurvenes, the founder of the Professional Boards Forum, argues that while companies could do a lot more women themselves need to do more to get themselves noticed “They need to raise their profile, tell people what they do, and network. I have talked to enough women to know that some still wait to be asked to join boards and think that their record speaks for itself. I have read their cvs and it’s clear they have outstanding results and a strong cv. They think that people will find them, but they will not,” she says.
A comprehensive approach to marketing yourself is required, part of which is seeing specialist search companies who focus on ID selection and recruitment. Many of the global search firms now have specialist divisions for IDs and, of course, there are specialists like Hanson Green.
However, given that according to the latest research 50% of opportunities are not available using this more formal process, networking becomes even more important so that you become aware of opportunities as they arise. My book has a chapter about how to build a portfolio directorships. I list the questions all prospective IDs should ask themselves:
– What do I have to offer?
– How will I find the right board?
– How much due diligence should I do?
– Do I have the time?
– Can I contribute?
– Will I learn?
– Will it be fun?
– What is the time commitment
– Is my current employer supportive?
– Should I expect a board induction?
I also identify a few simple rules to help you build a portfolio of ID directorships. These include:
– Choose carefully which offers to accept
– Build a balanced portfolio
– Avoid too many problem companies
– Avoid conflicts of interest
– Enjoy contributing to the companies with which you are involved
– Take the opportunity to learn about different sectors
To conclude, good luck and persevere. ‘Your country needs you’!
*Gerry Brown’s The Independent Director: The Non-Executive Director’s Guide to Effective Board Presence is published by Palgrave Macmillan.