Beyond gender diversity

02 August 2017

Beyond gender diversity image

Boards need diverse experiences – including, and beyond, gender

Research from Rita Goyal, Professor Nada Kakabadse and Professor Andrew Kakabadse

Despite public acknowledgment of the need for more equitable representation of women in leadership, there are still many male bastions in the UK yet to be inhabited by women.

In a recent article on BBC News, Katie Wright listed out a few areas where women have yet to occupy the top job. A few of those positions are Chancellor of the Exchequer, Archbishop of Canterbury, Governor of the Bank of England, and even agent 007!

Boards of top listed companies in the UK have undergone a transformation in the last decade, improving their gender balance significantly. The rationale behind these endeavours is two fold.

First, women have historically been missing from leadership roles, either by design of the powerful or due to the constraints of women’s socially acceptable roles. Now women ought to have opportunities to claim a place in those positions.

Secondly, women display a diverse thinking style and way of behaving that may improve decision-making greatly. A gender-balanced board also conveys positive signals to stakeholders, such as employees and customers, demonstrating that women have a level playing field, and that merit is respected in the company.

However, the emphasis on promoting gender diversity on boards also has led to sceptics asking questions, with reasonable validity, about the concrete benefits gender diversity offers a board and about other attributes also being relevant in boards.

Our research at Henley Business School addresses these questions. We interviewed forty-two board chairs and other members and asked them which diversity attribute is most relevant for improving a board’s performance. The response can be summarised as ‘experience’. The most relevant attribute that board members may have, which improves theirs and their board’s performance, is a diverse experience. Both personal and professional experiences count.

A diverse educational and functional experience enables board members to question assumptions made about the strategic plans of the company and to probe deeper. It also refines their ability to advise and guide the executives as they have wider knowledge and skill-sets than homogeneous boards. As a result, such expertise breaks the group-think which could, otherwise, potentially lead to failure of boards in their roles.

Personal experience of being exposed to challenges, such as different socioeconomic conditions or different languages, in their formative years make board members more tenacious and resilient. Such backgrounds drive them to seek innovative solutions to problems and not be demoralised easily.

Board members of a different nationality or a rich experience of other cultures have valuable international networks and also help boards in understanding local procedure and customs when companies are expanding their operations to territories outside the UK. Similarly, for ethnic diversity on boards, the contribution of members of the ethnic minority is richer if they have had varied experiences of growing up in other cultures. Merely a different ethnicity may not add uniqueness to the contribution of board members if their other experiences, such as educational and social-political-economic background, are the same as those of the majority demographic on boards.  

Lastly, gender is claimed to be a unique experience. And therein lies the contribution. Female directors bring a diverse thinking and contribution because the summation of their experiences is substantially different from that of their male counterparts. Moreover, despite different professional expertise, women often display certain attributes such as greater empathy towards stakeholders, sensitivity about the outcome and impact of board decisions, and deeper commitment to ensuring responsible resourcing. Boards benefit by recognising these traits and incorporating them, rather than by dismissing them for fear of stereotyping their colleagues.

Word by Rita Goyal, Doctoral Researcher