A key reason why there are still so few women on corporate boards comes down to old ways of thinking. Prioritizing inclusion and diversity has traditionally been considered a “nice thing to do” rather than a true business imperative. As a result, we regularly hear disappointing news like the recent report on 2018 Gender Diversity Index, which found that of the 2,835 active Russell 3000 companies, women hold only 17.7 percent of the board seats. Smaller companies are even less diverse, with the percentage of women on boards stuck at only 13 percent.
The fact is, though, as Deloitte recently called out, there is now an “inclusion imperative” for boards—one that requires “redefining board responsibilities to support organizational inclusion.” By building an inclusive leadership team in the boardroom—one that better matches today’s diverse marketplace and customer base—board members can help drive better company performance and bottom-line financial results.
Here are some points from SHAMBAUGH Leadership to keep in mind about the critical nature of board inclusion:
- Your board should reflect a diverse customer base. In a recent keynote last week to top leadership, I emphasized that creating balanced leadership teams and organizations has become a competitive advantage. No one person or group has all of the answers, so relying on a board that’s not diverse—where backgrounds of the members are closely mirrored, and everyone looks the same or thinks the same—will not help companies stay competitive. Boards, executive teams, and company leadership need a broad and diverse range of experience and perspective to succeed in today’s business environment.
- When building your board, remember buying power. Those developing inclusion initiatives need to think broadly across the board so that all types of voices have an equal chance for a seat at the table. Focusing on just women for a moment, we’ll see that according to some estimates, women account for as much as 85 percent of the total buying power in the U.S.—around 14 trillion dollars or approximately 60 percent of personal wealth. When we look at consumer spending worldwide, women are estimated to control about $40 trillion according to the latest figures—and these numbers are growing. These numbers shouldn’t be ignored at the board level.
- Balance your leadership thinking and approach. As reported in Forbes, “Given the size of this market it would be foolish for organizations not to cater to the needs of the female consumer. Yet…because of gender stereotyping, organizations often do just that.” At SHAMBAUGH, we completely agree with this assessment. Bottom line: women—who represent a significant percentage of the needs and voices of customers in every industry—are critical for balancing leadership thinking and decision-making at the board level and throughout organizations.
- Prioritize governing inclusion. As companies consider how to bring better gender balance to their boards, it’s important to understand a key distinction between diversity and inclusion. As Deloitte defines, “diversity is a state of being and is not something that is ‘governed,’ while inclusion is a set of behaviors and can be ‘governed.’” What this means is that companies have an unprecedented opportunity in front of them to begin better governing inclusion initiatives on their boards.
- Get current board members involved. SHAMBAUGH has long promoted the importance of inclusion at the board level in ensuring that all voices—including women’s voices—have an equal chance to be heard around the table. Current board members can play a key role in facilitating inclusive practices around board member selection, so that high-potential women in their organizations can have the same opportunity to contribute as board members, advance their careers, and help the company succeed.
If your company is ready to take it to the next level in creating better gender balance on your board and leadership team, SHAMBAUGH Leadership has tools, trainings, and customized programs that can help—to learn more, contact me at firstname.lastname@example.org.
Rebecca Shambaugh is a leadership expert on building inclusive and high performance cultures. She speaks at major conferences and to executives on how to disrupt traditional mindsets and create an inspiring vision and roadmap for driving greater levels of innovation and performance through a unified voice for leadership. Rebecca is the Founder of Women in Leadership and Learning, a regular contributor to Harvard Business Review, and blogger for the Huffington Post. She is author of the best-selling books It’s Not a Glass Ceiling, It’s a Sticky Floor and Make Room for Her: Why Companies Need an Integrated Leadership Model to Achieve Extraordinary Results.
SHAMBAUGH’s Mission: We’re on a mission to develop high-performing and inclusive leaders who transform workplace cultures so everyone can thrive.
Find out more about us at: www.shambaughleadership.com