Thirty Percent Coalition

We know that gender diversity at all levels is good for business.  Study after study shows that companies in the top quartile for gender diversity are more likely to have financial returns above their respective national industry medians and that diversity is a competitive differentiator. (See, e.g. McKinsey’s “Diversity Matters” report and Catalyst’s “Why Diversity Matters.”)

What we don’t yet know is how do we get representative numbers of women into the leadership positions of corporate America and achieve gender equality in the US? A recent piece by Nikki Waller and Joann Lublin in the WSJ called What’s Holding Women Back in the Workplace? discusses the recent comprehensive study on this topic by Lean In and McKinsey and does an excellent job of illuminating the issues and suggesting solutions, up to a point. What they did not discuss is the one action that has already been proven to be a game changer, all other factors notwithstanding: Put more women on the boards of directors.

In addition to correlations with improved financial performance, reduced fraud and better corporate governance, research shows that greater representation of women on corporate boards also correlates with an increase in women executives in that corporation. A Catalyst study published in December of 2013 indicates that a 10% increase in female board membership is, over time associated with a 21% increase in female executive presence in those companies. This includes a greater percentage of women in the profit and loss (i.e. line) positions that matter to the company’s bottom line and from which SVP and C-suite offices are most often filled.

Another striking statistic from the Lean In/McKinsey study is that 56% of women feel a strong, senior sponsor is extremely important to their advancement, while only 37% of men think the same.  Women see a leap to be taken over challenging waters, with few women on the other side to support them, to guide them, or at the very least, to simply stand for the proposition that it can be done. Women corporate directors provide role models for women at the early stages of their careers.  Career expectations of women at companies with gender diverse boards are also likely to go up as they see the possibility of moving into the top corporate echelons. It is also likely this positive mindset will encourage them to stay on track for the long haul.

The push to achieve gender diversity/parity should be part of a multi-faceted initiative, not simply focused at the board level. Yet we should not ignore a proven path to gender equality, which is increased gender diversity in the boardroom. More diverse boards will produce more diverse senior management and more diverse workforces. Overall, this produces better outcomes for companies seeking long term, sustainable growth.

There are many resources available to boards to help them identify qualified women directors. The Thirty Percent Coalition (http://www.30percentcoalition.org), a national organization comprised of more than 80 members committed to the goal of increasing gender diversity in the boardroom has compiled resources identifying qualified director candidates, including DirectWomen (www.directwomen.org).

Kathleen Franklin
DirectWomen Alumnae