Question

It is not unusual for even large corporate boards to have no women or minorities on them. In the US, women held 16 percent of board seats at Fortune 500 companies in 2012. In her 2013 book, Lean In, Sheryl Sandberg points out that this number has been flat for 10 years— or, as she puts it, there has been no progress in the past 10 years. In Europe, of the total number of board members in Britain, only 12 percent were women; Spain, France, and Germany all had less than 10 percent. In Norway, by contrast, female members comprised 40 percent of the boards.

So how did Norway do it? In 2005, the government of Norway gave public firms two years to change their boards’ composition from 9 percent female to 40 per-cent female. Is this a good idea? Spain, Italy, France, and the Netherlands must think so: Each country is considering implementing a similar quota (though generally with more than two years to implement it).

Questions

3. Would a regulatory quota be a good solution? Why or why not?

4. What other methods could be used to increase female and minority participation on corporate boards? Should it be perceived as a problem when a company seeks minority women as directors so that both statistics rise? What data would you gather in order to verify that such appointments are sincere?

Answer 1

The regulatory quota would be a very good option in companies or organization which might not improve the percentage of women occupying corporate board positions. In such a situation, imposing such a mandatory move would ensure that women are considered for the position and given an opportunity for the same. For many companies, if such an imposition is not made, such a move might never get implemented. Many times, women with better qualifications, experience, and expertise do not get the opportunity to be a part of the corporate board owing to gender inequality or biases towards male employees even though they are not as competitive as the female counterparts. Such a move would give each employee an equal opportunity to prove their caliber. Many corporate CEOs and managers are wary of giving women the position and such move would assist in paving the way for giving the women a chance to prove themselves. It might even turn out that the female counterparts would prove to be better performers and eventually the imposing would prove to be a boon for the corporates.

Giving similar projects to female and male employees and judging the quality of the final project outcome, timeline, other employees’ satisfaction, customer satisfaction etc would assist in choosing the better candidate.

Qualification, experience in the field pertaining to the job role, performance statistics over a period of time, team building qualities, working in team, relationship with co-workers, leading a team, sharing work, helping co-workers and subordinates, treating subordinates as equals but in a disciplined manner, etc. would be some of judging qualities that should be considered for choosing the correct candidate for the corporate board.