Keys to Building a Diverse Board
Third Quarter 2012
Corporate Board Member
Corporate Board Member recently interviewed Jane Stevenson, vice chair, Board and CEO Services, Korn/Ferry International, on the importance of board diversity and how boards can overcome challenges in the search process.
How would you describe Korn/Ferry’s philosophy with regard to diversity in the boardroom?
In a nutshell, we believe diversity is not only a good thing, it’s a business imperative. We believe that boards that have true diversity—not just diversity by one label or another—but diversity from the perspective of global reach, from the perspective of male/female, and race, have the strongest collaborations around governance. Therefore, because of that, we do our clients a real service when we are able to help them facilitate more diversity in the boardroom.
How does that philosophy translate into the work you do when clients require help with a board candidate search?
It translates in a very practical way in that we often end up having conversations around the complexion of the board that go beyond merely the criteria for that search. Instead we look at the board in total and look at where there are opportunities to most effectively insert perspectives from different viewpoints, gender, race, etc., into the equation. Sometimes that’s received more positively than others, but in all cases, we try to ensure we have a very diverse slate, so the board has, at a minimum, some options to consider.
How do you respond to boards that feel the qualified pool simply isn’t large enough?
This is really a chicken-or-egg kind of a question, because there is an expansion that has to occur in the marketplace to broaden that pool. That’s number one. But for the most part, I think it’s a cop-out excuse, to put it bluntly. I think it is more challenging to find those diverse candidates, but I believe there are opportunities to think more creatively, as well. So in a very linear sense, you’d have to concede that the lack of qualified candidates in the pool is an argument, but it also creates opportunities for boards to think more about what someone is going to bring to the thought process and to the whole governance discussion. And many times, that means someone who isn’t a sitting CEO of a certain company magnitude. If the board is open to thinking in that way, then there is usually opportunity to find well-qualified candidates who can meet that need.
Considering the very slow moving trendline on diversity progress, what do you believe it will take for corporate America to take a giant step forward in creating a more diverse boardroom environment?
I think it will take a couple of things. One of them is what Corporate Board Member is doing, and what Korn/Ferry is doing, to support the Move the Needle event, which is why it’s so exciting for us to participate.
Second, I think women are starting to speak more loudly. In fact, I know a couple of women who are not even willing to be on a board if they are the only woman. There is also more awareness that there has to be openness to diverse thinking and to having really strong teams. And teams are at their best when you have diversity, because you build off of each others’ perspectives, strengths, constraints, etc. As boards with diversity in place take hold, over a longer period of time, I think we’ll see stronger business results. So I’m hopeful from that perspective.
What about the possibility of mandates, similar to what many European countries have instituted?
I’m not sure that is likely to happen here. But I do think there are opportunities to create awareness that puts pressure on boards to at least think about it. Where the government is having influence is with highly regulated industries and where there are particularly large volumes of women or a particular diversity sector as customers. In those situations, there needs to be fair representation on the board to align their business strategies, so we do see that happening more today.
So to summarize, what is your outlook on progress regarding U.S. board diversity?
I think positive visibility around boards that are diverse will create peer pressure to move the needle forward—that’s essential. But there are a lot of different elements that will impact the current situation, and where we can create change is when we shine the light on the issue, both from a positive perspective and also from a peer-pressure perspective. But as you know, in governance the risk factor is always what seems to move the needle to create change in the boardroom. So we need to keep that pressure on.