Diversity and women participation in a complex world…
thus, why the selection criteria for a board of directors has not changed?
The FT recently published an article titled “Change how boards work to achieve true diversity”, by Vivian Hunt (22/10/20), a senior partner at McKinsey & Company (see online at: https://www.ft.com/content/0d095d7e-7333-4614-86ff-8264ea835894 ).
The article is professionally written and supported by valid questions and information. It brings back to the table the old question about women and minorities participation and Non-Executive Directors (NEDs) at board level. It states that although companies may have acknowledged the benefits of diversity, these same companies are not yet executing it.
The discussion starts with the problem that is facing all of us, can businesses continue to behave and think as they did before the pandemic? What lessons have been learnt?
Probably the main lesson emerging from this crisis is that the world is a lot more complex and interdependent that we ever imagined. Consequently, the survival of businesses is completely linked to the human community, the economy, the world as a whole. Another emerging lesson is that “the world” in which businesses operate comprises very different perspectives, capabilities, and experiences which, if disregarded, can negatively impact society and the sustainability of businesses.
Thus, if companies need to survive and build up strength after the crisis, this will not be possible if they continue ignoring the multiplicity of interests, experiences and points of view that surrounds the business. Companies will need to learn and amend their strategies and operations to respond to the “new normal”.
How can this perspective be built-in within a business? One obvious way is the active incorporation of minorities and women in the board of directors of companies.
The selection of non-executive directors across the different businesses and organisations, as presented in the article by the FT, is still highly restricted by traditional patters of selection that were adopted by previous generations. Companies and organisations are still using the same criteria and analytical tools that prioritise the choice of members of the dominant culture, similar educational institutions, similar social standing and experience, than has prevailed for decades, despite the current increasing complexity of the countries, the companies, and the world as a whole.
The article is thoughtful and clear when it asserts that nowadays diversity will not be enough because after the current pandemic period there will be a clear need to restore trust on companies. This trust will very much depend on the way that these companies deal with the whole set of stakeholders on which they depend for their survival.
A good board of directors for the “new normal” must value the experience that diversity effected by women and minorities participation, can bring to the company. This is not a theoretical issue. It is a practical undertaking which can only materialise and be put together if the selection and inclusion of new Non-Executives in the board of directors takes the matter seriously, promoting members of the community to contribute, to get motivated, and to take part in what is substantial for the organisation.
Despite some relative improvements in the case of women participation, the general situation suggests that minorities (many of whom are women) are overlooked even when they are well qualified and long experienced for attaining NED positions.
The issue cannot be restricted to suggesting a statutory quota or to pushing for guidelines that may become a simple “box-ticking” exercise. The issue demands a serious assessment of factors affecting the selection of NEDs as part of a real understanding of today’s world. The job is shifting the traditional selection and head-hunting methods that have become real obstacles to the transformation processes that are needed.
What is really stopping firms and organisations in modifying their practices towards genuinely sponsoring and reinforcing women and minorities’ participation? How will companies embrace the “new normal” and be proactive in changing the current constraints faced non-traditional NEDs? What exactly in the current system of your organisation is stopping women and minorities in getting designated as non-executive directors?
Look seriously to your own company and make progressive and pragmatic changes that help to get your board of directors where it should be. Change the “logarithms” that are stopping progress.
We all have a responsibility in this task!
