Corporate Board Diversity
Customers, investors, and the general public are demanding that the board of directors of a business reflect the demographics of the community it serves. The inclusion of diverse members can boost the efficiency of a board and click this boost its credibility as an employer. Diversity in a corporate boardroom means different things to different boards and businesses.
Diversity is usually defined by gender and ethnicity. However the benefits of diversity extend beyond these traditional traits. Research suggests that boards with a more diverse mix of different experiences are less prone to groupthink. The idea is that directors with diverse backgrounds and perspectives are more able to debate each other’s opinions to generate robust discussions, stress testing alternatives and make informed decisions.
It’s hard to argue against the need for more diversity in corporate boards, but it isn’t easy for chairpersons and executives to select the best candidates. Some advocacy groups provide lists of possible board candidates but they’re not typically in the network of board chairs or have never been considered for the top management post.
Boards can begin by conducting an audit of their current members’ profiles. They can then use their annual evaluations in order to remove members that are no longer productive, and to find new talents who reflect the future of the company. They can also tap into their network to identify the trailblazers who aren’t part of their all-inclusive director pool.