Two-thirds of ASX 200 boards say they “always or sometimes” gravitate towards candidates who are known to board members when selecting new directors, hindering efforts to achieve gender diversity on boards, according to a survey by the 30% Club.
Directors who responded to the survey said it was easier to work with someone who was known to board members and who had established reputation in the market.
Susan Oliver, 30% Club Steering Committee member, said given the current small percentage of directors who are female, this leads to a “catch 22” situation for women.
“…Fewer females are known to directors, and this reduces the likelihood that females will be selected,” said Oliver.
Only 6.5 per of respondents sought outside advice on succession planning, and only 10.2 per cent of respondents cited the need for enhanced board diversity.
“The challenge in achieving gender equity is not one of supply but continues to be one of demand, with insufficient numbers of boards perceiving gender diversity as a strategy imperative,” said Oliver. “When chairs place too high a value on ‘collegiality and teamwork’, it can be sued as a code for ‘being like us’ and limit the opportunity for injecting innovative and diverse thinking.”
The Club posited that good succession should be based on skills, diversity and planning for the future rather than replacing like with like.
Other practices that hindered diversity efforts were the adherence to a de-facto fixed term for directors of nine or 10 years, as well as highly specific experience briefs.
By Anastasia Santoreneos
Source: Money Management
“My biggest mistake is not recognizing the power of compounding and the ability for it to build wealth, and therefore, not investing early enough,” she says. “To me, if there is one thing that can change our society, our economy, and the world, it is getting more money in the hands of women.
Indigenous Americans make up less than 1% of board members for major, publicly traded businesses, according to DiversIQ analysis. Only five people among the 5,537 board members for the S&P 500 identify as fully or partially American Indian or Alaska Native.
These three questions can not only play a pivotal role in strengthening an organization’s DEI culture; they can also serve as team-building exercise. The process of evaluating one’s understanding of DEI principles promotes open discussions, knowledge sharing, and alignment within the team.
