Women are infiltrating boardrooms in greater numbers but are still largely absent from board chairmanships.
The latest global report of women in the boardroom by advisory firm Deloitte, now in its fourth edition, shows an increase in women around the board table in the 40 countries surveyed.
But dig deeper and things are not what they seem, says Dan Konigsburg, managing director Deloitte Global Center for Corporate Governance.
“When you compare the number of women on boards with the number of women chairs, for example – often a much more meaningful indicator of where the power lies on a board – countries with high numbers suddenly look less inspiring.”
Konigsburg singles out Denmark, a country with more than 20% of board positions held by women but with no women in chairman roles.
In New Zealand, Deloitte’s analysis of board membership found 17.5% of board seats were held by women, but only 5.6% of board chairs.
“We intend to monitor this metric over time,” says Konigsburg, “and we expect it to be a meaningful predictor of real change in global boardrooms.”
Former Fairfax chief executive and professional director Joan Withers, who wrote an introduction to the Asia Pacific section of the report, says the push to get more women directors is not going to happen unless there is a pipeline of women coming through from corporate leadership.
“What we're seeing consistently is an under-representation of women at senior levels within organisations, and they typically characterise that as levels 1 to 4,” she says.
A new breed on chief executive emerging
Withers says larger employers are now working hard to assist women wanting to progress their careers, along with organisations like Global Women who are providing not only training for leadership but networking and mentoring support.
She points to a new breed on chief executive, singling out Auckland Airport’s Adrian Littlewood, Mighty River Power’s Fraser Whineray, and TVNZ’s Kevin Kenrick, who have a different perspective on diversity and “really get it” in terms of bringing through the best talent.
“I think that the only way it’s going to happen is if we get a focus on ‘what are the real issues that are causing women to not be there?’, particularly at CEO and the next level down, and then getting an understanding of how some of those impediments can be removed and changed,” says Withers.
With boards having a hand in key executive appointments, the presence of women at board level can impact the leadership recruitment process, says Withers.
“Boards that I have worked on are very much saying: have we put the net wide enough, are we assessing the universe in the way we need to to make sure we’ve got the best candidates for this?
“Diversity is a very important part of that.”
Shareholder advocates leading the way
The Deloitte report highlighted the work done by shareholder advocates, both publically and behind the scenes, to lobby for greater boardroom diversity since the last edition in 2013.
In New Zealand the Shareholders Association has committed to supporting several initiatives to lift boardroom diversity, including the Future Directors programme run by the Institute of Directors, and chairman John Hawkins says it will also have a quiet word with companies that are stuck in a “male, pale, and stale” rut.
The association’s policy is to promote diversity in its broadest sense, including gender, age, experience and ethnic background.
“The last thing you want is a whole bunch of people around the board table who all happily agree with each other,” he says.
Boards, especially at the bigger companies, demand experience, which creates a catch-22 when you’re trying to introduce new talent, says Hawkins.
“That’s where mentoring to some extent, but the Future Directors programme in particular, have a real role to play."
Hawkins says while there are exceptions, diversity around the boardroom is gradually improving.
“I think that this is the start, in some respects too late and some respects too slow, but there is a definite start there and I would certainly hope it would accelerate.”
View the complete Women in the Boardroom report.