The strong business case for gender equality in the boardroom has been articulated powerfully recently, everywhere from Davos to governance groups to the consumer media. CEOs, chairs and directors are doubtless tuned in and concerned about both the perception and performance of their boards on this issue. The core argument that makes the case for gender equality as an effective business strategy is that diversity encourages constructive debate and independent thought, without which productive change will never be effected.
One of the most important considerations when evaluating a prospective director is how he or she would complement current skills, and complementary skills are by definition different skills, acquired from the different experiences, insights and styles that gender diversity brings. It is frequently noted that women directors not only bring to the table invaluable insights into female consumers, but also serve as inspirations to female employees. Some studies have gone so far as to claim that the absence of women at the board table implies obsolescence and groupthink, and that their presence in greater numbers on the boards of companies that consistently outperform their competitors constitutes proof.
The net result is that the benefits of gender diversity are irrefutable, and there has been considerable noise on the topic. So why has change been so long in coming? We believe that the roadblock has been the recruitment process, and that the implementation of an effective recruitment strategy to correct this shortfall should be addressed.
The old-school networking and “usual suspects” approach that controlled board recruitment in the past is being replaced, even for men, because it has been acknowledged to be inadequate for a host of reasons in this new world of greater board accountability and transparency. A strong board with the optimal mix of skills and experience is a critical competitive advantage, and the recruitment of new directors is too urgent a business issue to be determined by a “who knows whom” approach. The recruitment process for business management at all levels adheres to quite stringent criteria, handled for the most part by professional third-party search firms. There is no reason that the standard to which board directors are held should be any less rigorous.
Best-in-class searches are dictated by business strategy and perceived gaps in skills on the board, rather than by incentives or quotas. Systematic, competency-based recruitment by an experienced outside partner that includes the most talented women—as well as men—will result in directors with the skills and experience required for a specific board situation. Conscientious focus on this process ensures that the well-known pitfalls of board selection will be avoided, such as choosing a known quantity over a potentially better candidate, and compromising on crucial competencies to fill the seat quickly. It also addresses the goal of casting a wider net that will include more women.
Competency-based recruitment legitimizes the focus on gender by shifting it from a compliance or fairness issue to a best-practices issue. In an era when accountability is paramount, competencybased recruitment conducted by an experienced third party serves the purpose of documenting the due-diligence requirement of a rational and thorough process.
It is frequently posited that capable women director candidates are not currently on the search radar screen, chiefly because there are still relatively few women with the traditional director background. We believe that as a natural result of modern, rigorous, disinterested recruitment, the best women—who certainly are out there—will be identified right along with the best men.
Kim Van Der Zon is a partner at Egon Zehnder International.