The qualities of female leadership are missing from business, says Dr Philippa Reed.
The call to action on the inadequate numbers of women on boards in New Zealand has been sounded more forcefully in recent months - and highlighted by the Minister of Women's Affairs Pansy Wong in a recent Herald article.
A Herald editorial also broached the issue, with a headline
claiming companies are the losers from the paucity of women at senior leadership levels. It also called for more "dispassionate research" into the issues and questioned the myth of the glass ceiling after four decades of equal opportunities.
The Equal Employment Opportunities Trust (EEO Trust) has worked for 17 of those 40 years alongside companies which do have a stated commitment to making EEO real and effectively engaging an increasingly diverse workforce.
However, despite the work of the EEO Trust and many other committed individuals and organisations, just under 9 per cent of the directors of NZSX companies are women. Compare this with the total labour force which is 46 per cent women.
This would not be a problem if women did not want to be involved in corporate governance and they weren't good at it but there is plenty of research which suggests otherwise.
There are well-qualified women with ambition, with 122 women on the Institute of Directors database of members actively seeking directorships. There are 2800 qualified women listed with the Ministry of Women's Affairs Nominations Service and the Crown Company Monitoring and Advisory Unit has 810 women on its 2700-person database.
Along with the Human Rights Commission, the EEO Trust recently brought international governance expert Dr Susan Vinnicombe to New Zealand to meet prominent board chairpersons, senior men and women, and community representatives to explore strategies for the future.
Ideas from participants, all of whom are engaged in New Zealand businesses, included more transparent board recruitment processes, creating mentoring opportunities for women and a requirement for companies to report on gender diversity on their boards, similar to the Australian Securities Exchange initiative.
We have also encountered some vehemently negative responses to the proposition that this is an important issue which impacts on society - and that women can improve corporate governance. One of the most common was addressed by Minister Wong - that aiming to redress the gender imbalance at senior levels requires shifting the focus from merit to gender.
No one is suggesting lower standards of governance. In fact, events of the past 18 months or so have shown that corporate governance is in serious need of improvement. Tapping into a wider base of skills and experience is part of this.
A considerable body of reputable international research shows that diversity of views and experience around the board table - or the management table - brings advantages in innovation, risk management and less group-think.
So how many women are needed for a board to function more effectively? North American research found that three or more women became a "normal" part of a boardroom, mitigating the dynamics that might prevent one or two from making a full contribution. The research was among Fortune 1000 companies and found that women directors tend to make three contributions that men are less likely to make.
They tend to broaden the content of discussion to push boards beyond short-term financials and consider the concerns of a wide set of stakeholders. They are also more likely than men to ask tough questions and raise difficult issues. As one male CEO put it, "The men feel a gender obligation to behave as though they understand everything".
Third, women directors tend to take a more collaborative leadership approach than men, enhancing communication among directors and between the board and management.
The biggest gains from having women on boards relate to improved innovation, communication, strategy implementation, and employee and customer satisfaction.
In other words, as the Herald editorial said, it is business that suffers from women's under-representation around the boardroom table.
Companies that are genuinely committed to accessing diverse talent know that it takes a raft of initiatives to achieve change. A supportive workplace culture is critical, as are successful role models to help expand young women's aspirations. Some companies also adopt internal targets, knowing that while this may not work in isolation, it signals a commitment to measure progress, and a determination to translate words into action. This is precisely what is needed.
Calling for more women on boards and in leadership roles is in no way denigrating the achievements of those who have made it. They have done so under their own steam, on the basis of their experience, skills and commitment.
However, a spurious argument for appointment on merit can act as a cloak for cloning. The best people will not necessarily look or act like the people who are already at the top. Merit needs to be accurately measured.
* Dr Philippa Reed is chief executive of the EEO Trust.
