One of the common barriers when it comes to getting more diverse voices in the boardroom is not seeing beyond your own networks.
Case in point. In an effort to diversify the board of a Fortune 500 company, a board member recommended his neighbor who was professor emeritus of information technology at a prominent university. The professor had great subject matter expertise on information technology but very limited business knowledge. He didn't read the board materials in preparation for the board meeting which became obvious by the questions he asked during the meetings. He was ultimately not nominated to stand for reelection.
Such narrow outreach has contributed to limiting the process of diversification in the boardroom, but mandated or not, the diversity imperative for corporate boards is here to stay. Recent activism around workplace equity is helping to move the needle but it's still moving at a glacial pace.
Although we are seeing some momentum, change takes time and dedicated effort. Diversity just doesn't happen unless there is a belief and commitment to the aspiration of having a more diverse board.
Research studies have repeatedly shown that market caps are bigger and above-average financial returns are in the top quartile when there is gender, racial, and ethnic diversity on corporate boards. Not to mention the social and cultural lift that occurs when customers and employees can see people "like me" in powerful positions.
There are multifaceted reasons as to why many companies don't make more progress diversifying board composition. An honest and difficult assessment of these factors will help corporate boards make progress in a meaningful way.
Here are some of the barriers to board diversification to help identify actions that boards can take to make more progress with diversity:
* It's not what boards are used to doing; attracting diverse candidates requires a different approach. Many boards rely on their own personal networks which tend to be more homogeneous. Recruitment processes that ensure diverse slates of candidates must be adopted.
* Artificial barriers come into play; the traditional 'go to' profile tends to be a sitting CEO, which limits the pool of available diverse candidates. Focusing on the skill sets the board needs rather than the position title...