Jim is a Premier Managing Director for the NYSE’s Global Corporate Client Group with responsibility for companies headquartered in the Connecticut...
While some of what I’ve been discussing in this space has involved companies and individuals doing some great work for those in need, this topic does not fall into the ‘philanthropic’ category by any stretch of the imagination, however I did want to share some of the comments made by a terrific panel discussing how to better engage more women for spots on corporate boards of directors.
“There’s a natural tendency to say we need a CEO, but how many CEOs on a board do you really need?” That question was posed by Murray D. Martin, CEO of Pitney Bowes Inc., one of 52 companies recognized at the New York Stock Exchange Wednesday for their efforts to put more women on corporate boards.
Companies honored have at least 20 percent female representation on their boards. “You don’t need all CEOs, you need people with other skill sets,” observed Mr. Martin as part of a panel entitled “Women on Boards: Why Now and How?”
Mr. Martin believes corporations have to work harder to seed the pipeline. “As women rise in the corporation, we send them to directors training and look to get them on a public board.” Other panelists pointed out that nonprofit board experience can provide important experience.
Shelly Lazarus, chairman of Ogilvy & Mather Worldwide, heads the board nominating committee for General Electric Co. She says it’s frustrating to see the same people up for consideration repeatedly: “I challenge search firms here.” She says women entrepreneurs are an underused resource when it comes to public board membership, but it can be hard to find these candidates. The catch 22: Entrepreneurs lack public board experience and without public board experience they may not get nominated or elected. Lazarus says it is crucial to look at skills such as financial, legal, government, technology the candidate may offer.
If Europe is any indication, corporations may be turning to skilled women entrepreneurs to serve. Norway, Spain and France now require public companies to fulfill an aggressive gender quota. Earlier this year, EU Justice Commissioner Viviane Reding called on public companies to voluntarily fill 40 percent of board seats with women by 2020. “I believe that self-regulation could make a difference if it is credible and effective across Europe. However, I will come back to the matter in a year. If self-regulation fails, I am prepared to take further action at EU level,” she said in a statement.
Those honored at the New York Stock Exchange offered arguments that gender diversity on corporate boards is a strategic imperative. Their views are support by a recent McKinsey study. It finds that companies with women on their boards significantly outperform those with no female representation: by 56 percent in terms of operating results and by 41 percent on return on equity.