Women on Boards : Moving from ‘Why’ to ‘How’ Posted on January 5, 2015 by willforumindia The past few decades has seen women professional take significant strides into the professional domains, yet in India with over 500 million women, women executives at the top have yet to a see a shift in their positions and influence. ‘Balanced Leadership’ which advocates equal representation of both qualified men and women professionals is to a great extent still treated with tokenism and most of the dialogues remain elementary. In 2006, Norway passed a law requiring 40% of the boardroom seats to go to women in 2014; Germany passed legislation for 30% of the board composition to be women. In 2013, India amended the Companies Act – it mandated that all companies listed on stock exchanges must have at least one woman on its board of directors. As per the Indian Boards Database (indianboards) from the 1464 companies listed on the NSE, 37% of the listed companies are still without women directors. In India, even this number of ‘one’ woman director has been met with resistance with reasons such as the pool of ‘qualified’ women is sparse and that women do not demonstrate the mental resilience required to take tough decisions. The easier route for most Indian companies has been to designate a women director from the promoter family, thus achieving compliance and also sadly demonstrating their unwillingness to truly diversify. In the larger context, the debate on “Why Women on Boards” has long gone in favour of the argument and the extensive evidence indicates that companies with more women on their boards outperform companies with fewer or no women directors. Organizations increase their competitiveness, have a better stakeholder engagement, have improved corporate governance and ethics, and increased net income growth. The shift now needs to be from thought to action, on how to make this happen – the tangible, demonstrative actions which organizations need to undertake to a) have women at the boards and b) to ensure that these women are not reduced to figureheads and instead have a powerful role to play in supporting governance and sustainability. Call to Action: #1: Legislation: While quotas are debatable – the fundamental argument for quotas is that they singularly help initiate action and create the “critical mass” which if left to intent alone, may be never achieved. Till such time there exists a better methodology which guarantees the advancement of women, quotas are here to stay. #2: Articulate and Embed the organization’s commitment- Organizations with no stated intent needs to begin with this first step – state it explicitly and communicate this intent. For organizations which have a stated intent need to ensure adequate sustainable actions drive the ambition. However all of this can be achieved only from top down and needs to be owned and driven by the top echelons of the organizations and also demanded by the stakeholders. Companies also need to designate independent women directors versus women directors from families alone. #3: Validate the Number of Women in the Leadership Pipeline: Even organizations with a sizeable number of women workforce struggle to have more women in senior roles – who can be seen as logical candidates to be promoted to the boards. The real work for organizations is to eliminate gender biases, create this pool of high –potential women and ensure career advancement for deserving capable women candidates at all levels is charted out and firmly embedded into the DNA of their talent management and leadership frameworks. #4: Invest in Women Candidates: Invest in the development of these candidates by providing active sponsorships, executive development and building board capability and readiness way before these candidates are moved into these roles. #5: Role of Women Directors for Good Governance: Women on Boards must advocate and support the advancement of more women to senior management roles. Whether as role models or as those in a position of authority, these women have a critical role to play in supporting the overall mandate and need to assume responsibility. Role of women across levels is of extreme relevance – rather than wait for entitlement, they need to also actively seek assignments and raise their hands for larger stretch assignments. Cultural shifts are compelling organizational change toward embracing diversity on boards and senior leadership. Traditional mind-sets and decades of cultural-social biases need to be rejected in the workplace. In 2015, a personal commitment from all business leaders to ensure that there is at least one woman director on every board and for true visionaries to go beyond the legislature and have 30 % women directors will prove to be the game-changer for Corporate India. In 2015, the WILL Forum is determined to build board capability for 400 women professionals in India. To enrol for the programs, please visit willforumindia.
Posted on: Mon, 05 Jan 2015 16:58:30 +0000
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