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Prematurely promoting women to fulfil board quotas lets down those who are there on merit
This month saw the publication of Lord Davies’ second annual progress report on women on boards. The primary recommendation of his original report, published in February 2011, was that FTSE 100 boards should aim for a minimum of 25 per cent female representation by 2015. He is now encouraging FTSE 250 companies to take up the same challenge, and asks FTSE 350 chief executives to publish, by September, the percentage of women they aim to have on their executive committees by 2015.
As a female corporate partner working primarily with listed companies, my knee-jerk reaction to the idea of more women in the boardroom was that it must be a good thing. I am increasingly uncomfortable, however, with the narrow male vs female context in which the debate is playing out.
Diversity is not about quotas but rather ensuring that boards have a complementary and balanced set of skills, and all individuals feel able to express their views effectively. The qualities that make up a diverse board are not necessarily male or female. Although a gang of like-minded male directors headed by a dominant male CEO is one obvious route to group-think. Mrs Thatcher’s later cabinets provide a good (albeit extraordinary) example of a female leader who did not notably countenance much debate or divergence of views.
More importantly, I am concerned about the damage that may be done to women by setting the artificial targets for board representation too high.
In the legal profession we have made great progress towards equality, particularly at the more junior level, albeit with much work still to be done. I am not, however, an advocate of mandatory quotas for female partners. Equally, my sense is that the pool of female talent in other sectors may not yet support female director quotas, whether mandatory or self-imposed. This is in no way a question of women not being as able as men, but rather reflects what Lord Davies has identified as the “executive pipeline challenge”. The only way to become a chief executive is by gaining experience and achievements over many years. Whether we like it or not, traditional attitudes to women kick in much earlier in a woman’s career than the stage at which she is ready to join the board. If women are not being given equal opportunities and support throughout their careers, which is still too often the case, it is naive to think there must be a huge backlog of women ready and waiting to take up executive positions to meet arbitrary targets.
The worst possible outcome would be for women to be appointed to executive positions who do not yet have the full skill set to perform at the highest level. To place women on boards who are not yet ready to hold such office would do a grave disservice to those women who have got there on merit.
I accept that there is always going to be an element of learning on the job, but surely we would be better to focus on mentoring and preparing high-calibre female senior managers with a view to getting them into executive board positions in three to five years’ time rather than to accelerating these women onto boards before they are ready, just to fulfil a quota.