Focusing on Quotas to Improve Board Diversity is Stupid!

ECONOMICS US

Countries with higher levels of gender equality have higher economic growth. Companies with more women on their boards have higher returns. Peace agreements that include women are more successful. Parliaments with more women take up a wider range of issues – including health, education, anti-discrimination, and child support.  ~Ban Ki-moon, UN Secretary General

In boardrooms and corporate executive meetings around the globe the focus is on increasing gender diversity at all levels of the business, but especially at the top.  With recent studies by McKinsey (Women Matter, McKinsey & Company) and others showing that more diverse senior teams consistently deliver better business performance, there has been increased pressure to increase the number of women at the top.

In 2011 the UK government published the Davies Report on Board-level diversity (Women on Boards) and set a target of 25% female board directors by 2015. This is starting from 12.5% in 2010.  Essentially doubling in five years!  Great objective and as of the most recent 2014 BIS Women on Boards report, it looks like the goal will be achieved.

Untitled

 

Job Done?

While this may look like good news and “job done”, there is much more to the story. First of all, a good number of women on boards in the UK are American, and secondly, they serve on multiple boards! Not exactly what was intended, but it helps tick the box!

More importantly, if you look at what is happening inside of companies where the real work is done, and where the value of diversity of all types pays big dividends, the story is less than flattering.  While women start out in about equal proportions to men in entry-level positions in UK corporations, there is a massive amount of female attrition in the higher management levels.  For greater insight into this fallout, and the figure below, see Your Loss by Christina Ioannidis and Nicola Walther.

attrition-triangle

The fallout is so great that very few women are available for senior executive positions. And even more interesting, the % of women in senior executive positions has been declining over the past several years!

Boards and Exec

It’s the Culture, Stupid !

As a response, a multitude of “women only” training courses and workshops designed to “prepare women for senior roles” have sprung up in the UK.  And then there are external and in-company “Women Networking” events to build stronger women to women networks. The theory behind all these activities being that women don’t understand the special nature of senior roles and need additional training, networks and education. Another one of life’s great myths! (for an excellent review of the many myths about women in business, see Cracking the Code).

Teaching women to understand the challenges of senior management is like polishing the apples when the barrel is rotten!

It’s the current corporate culture that’s the problem, not women’s skills or capabilities.

The fact is, business is a male dominated environment and the corporate culture of most, if not all companies, is a collection of male habits and behaviours. It’s not right or wrong, it’s just the way it is.

The way corporate cultures evolve is by the establishment, repetition and consolidation of reasonsbehaviours, work habits, ways of dealing with each other and customers, into characteristic “ways of working”, or “how we do things around here”. And it’s mostly driven by male-dominated styles.  Male jokes, male aggression, male fun, male drinking sessions, male internal competition, male bonding, male ways of dealing with each other. They all combine to create a heavily male corporate culture. And (no surprise) women are wired differently than men, they approach problems and people differently, it’s the way it is. And it’s one of the great values of diversity!

Trying to teach women executives to be more male-like or fit into the male dominated corporate culture is the wrong approach.  Instead of workshops for women, we need workshops for men and women together!  Customised in company workshops designed to bring both groups together to learn from each other, to build a corporate culture that works even better, for improved competitive advantage.

Want to increase the % of women and others on boards and in senior management? Want to really capture the power of diversity for competitive advantage and business effectiveness?

Forget about quotas.  Start bringing all the parties together to build a new, high performance corporate culture that is powered by diversity, not quotas.

Written and Posted by:

John R. Childress
Senior Advisor on Corporate Culture, Leadership and Strategy Execution
Author of LEVERAGE: The CEO’s Guide to Corporate Culture and FASTBREAK: The CEO’s Guide to Strategy Execution
Visiting Professor, IE Business School, Madrid

email: john@johnrchildress.com

PS: John also writes thriller novels

About johnrchildress

John Childress is currently Visiting Professor in Strategy and Culture at IE Business School in Madrid and a pioneer in the field of strategy execution, culture change, executive leadership and organization effectiveness, author of several books and numerous articles on leadership, an effective public speaker and workshop facilitator for Boards and senior executive teams. In 1978 John co-founded The Senn-Delaney Leadership Consulting Group, the first international consulting firm to focus exclusively on culture change, leadership development and senior team alignment. Between 1978 and 2000 he served as its President and CEO and guided the international expansion of the company. His work with senior leadership teams has included companies in crisis (GPU Nuclear – owner of the Three Mile Island Nuclear Plants following the accident), deregulated industries (natural gas pipelines, telecommunications and the breakup of The Bell Telephone Companies), mergers and acquisitions and classic business turnaround scenarios with global organizations from the Fortune 500 and FTSE 250 ranks. He has designed and conducted consulting engagements in the US, UK, Europe, Middle East, Africa, China and Asia. Currently John is an independent advisor to CEO’s, Boards, management teams and organisations on strategy execution, corporate culture, leadership team effectiveness, business performance and executive development. John was born in the Cascade Mountains of Oregon and eventually moved to Carmel Highlands, California during most of his business career. John is a Phi Beta Kappa scholar with a BA degree (Magna cum Laude) from the University of California, a Masters Degree from Harvard University and was a PhD candidate at the University of Hawaii before deciding on a career as a business entrepreneur in the mid-70s. In 1968-69 he attended the American University of Beirut and it was there that his interest in cultures, leadership and group dynamics began to take shape. John Childress resides in London and the south of France with his family and is an avid flyfisherman, with recent trips to Alaska, the Amazon River, Tierra del Fuego, and Kamchatka in the far east of Russia. He is a trustee for Young Virtuosi, a foundation to support talented young musicians. You can reach John at john@johnrchildress.com or john.childress@theprincipiagroup.com
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