Tuesday, January 6, 2009

Women Gain Hidden Ground in the Boardroom

Recent research by by Dan R. Dalton and Catherine M. Dalton profiled in the Harvard Business Review (HBR) highlighted that women are starting to gain some hidden ground in the boardroom.

With over 80% of purchasing power in the USA being influenced by women, businesses need to factor in more customer or consumer purchasing experiences that cater to women's needs.

If over 80% of the boards are governed by men, how can they effectively understand their customer psyche. I find it rather ironic - we hear the claim customer first, yet the board of director leadership composition rarely reflects a fully diversified market profile to local markets.

In Toronto, for example our main ethnic sectors would be ensuring a mix of Asian, Hindi, Italian, Jewish, Hispanic, Black and White cultural heritages had a represented voice in the boardroom. Unfortunately companies lag in diversity at the top, and leadership representation of women remains in Canada 5-6% of board room composition on average.

This research below highlights some glimmers of hope.... time will tell. The statistics have not really improved in over 15 years ... so I remain concerned this research is not representative rather a glimmer of hope is always an improvement in outlook. So recognition and applause is deserving to the research team.

Research Highlights are summarized below:

Although the number of women serving as Fortune 500 directors has risen only marginally in recent years, the simple board-membership data conceal important progress. The percentage of women on the crucial audit, compensation, and nominating/corporate governance committees of the biggest companies is increasing markedly, as is the likelihood of their chairing those committees. Moreover, significantly more women have become lead directors (a pivotal position on a board where the chairman is also CEO). In 2001, just 1.8% of lead directors were women; by 2007, the figure was 8.1%.

Other trends support the notion that women’s corporate clout is growing at a healthy pace:

** More than 80% of Fortune 500 boards include at least one woman.

** Between 2001 and 2007, the number of boards with two women rose 34%, and those with three more than tripled (from 25 to 76 companies).

Thus, it is becoming commonplace for male directors to interact with female directors who have significant governance responsibilities.

That portends well, we believe, for women’s increased presence in the boardroom over the long term.

1 comment:

rnbresearch said...

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