The next time you’re in the board room, look around. If the only people you see around you are men, you’re likely putting your company’s future at a distinct disadvantage. That’s because diversity of thought is a key ingredient to corporate success, and one way to help ensure your business gets what it needs in this area is by electing more women to your corporate board.
Board seats have historically been filled predominately (and at times nearly exclusively) by men. This has been changing slowly over the past decade or so, but it’s time to pick up the pace, in part because it just makes good business sense.
According to a recent report from Catalyst, the return on equity for Fortune 500 companies with the most women board directors is a whopping 53% higher than for those with the fewest women board directors. Studies overwhelmingly show that companies with women directors on their boards tend to outperform on indicators of customer responsiveness, ethical accountability, and risk management.
Another study conducted by McKinsey & Company shows a strong correlation between the success of a business and the diversity of its leadership. In fact, the top 25% of gender-diverse companies are 15% more likely to outperform their competitors.
This research speaks volumes about not just the qualitative, but quantitative benefits of women serving on boards. So why are we still so grossly underrepresented in these roles? Sure, the number of women in board positions is increasing, but it’s still way too low, especially when you consider the proven, immense benefits of having more diverse representation and leadership. In fact, according to the 2018 Gender Diversity Index by nonprofit initiative 2020 Women on Boards, nearly half of the largest 3,000 publicly traded companies in the United States still have one or no women on their corporate boards.
Support and Mentorship
I believe the responsibility lies both with company leadership to seek out more diverse candidates, and with us as strong women to find – or create – a seat at the table for ourselves and others. For example, as someone who serves on several corporate boards, I made it my personal mission to advance more women for opportunities to serve as directors. This can mean, among other things, supporting qualified women for open seats on boards we currently serve on, mentoring women who are seeking their first board seat, and speaking out about the demonstrable benefits of women serving on boards generally. If all women currently serving on publicly traded corporate boards embraced this mission, we would create meaningful change.
I’ve always believed that “you can’t be what you can’t see,” meaning that it’s hard to envision yourself in a role that no one like you has ever filled. I was guilty of falling into this mindset early in my career. I never even dreamed of serving on boards for top companies because I had never seen a Latina do it.
Then came a turning point. I was invited to attend a women’s business conference in Mexico but declined as I had a baby daughter at home. The timing just wasn’t right. But after strong encouragement from one of my mentors, I hesitantly agreed. And I’m so glad I did.
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At that event, I met incredibly inspiring Latinas like Linda Alvarado who was a board member at Pepsi and 3M, and Maria Sastre, who served on the board for Laidlaw International. There, I had a true “a-ha” moment. I realized that I, too, could be a board member and that Latinas can push far beyond societal and cultural standards.
Since then, I’ve had the pleasure of serving on the Board of Directors for Comerica Inc., Cinemark Holdings Inc., and Kohl’s Corp., among others. I’ve also made it a personal mission of mine to help open the door for other women to step into these roles.
Finding a Pathway
I founded At the Table: Women in Business and Leadership to help more women find a pathway to the board table or to the c-suite. This program specifically focuses on empowering Latina entrepreneurs as the strong economic force that they are through training, guidance, and networking opportunities, helping to strengthen local communities from coast to coast.
I also proudly serve on the Dallas-Fort Worth steering committee for the National Women on Boards 2020 Campaign, an initiative seeking to increase the percentage of women on US company boards to 20%, or more, by 2020. We achieve this by empowering women and educating the public about the importance of this issue and the imperative need for more diverse counsel on all corporate boards – public, private, large, or small.
As investors are paying increasing attention to the effectiveness of their corporate boards, quality is more important than ever. And when they, and all of us, think about leadership and company performance, the composition of a company’s board is a critical element. If CEOs and existing board members can recognize the importance of age and education diversity, it’s time they also open their eyes and stop underestimating the benefits gender diversity can bring to the table.
The current job market is full of women who have the experience and expertise needed to serve as effective directors, and it would simply be foolish not leverage this incredibly rich talent pool when looking for strong governance and corporate oversight. Increasing the number of women on boards can bring just the shakeup that’s needed to improve performance levels, elevate standards, and raise company’s bottom line.
While equality for women in the workplace has greatly improved over the past generation, the representation of women on corporate boards has not kept pace. Ultimately, it’s a major and achievable opportunity for growth here in the United States and around the world. A corporate board comprised of both men and women will maximize performance, strengthen business, and contribute to the economy overall.
So, CEOs and governance chairs, it’s time to add more women to your boards – not just for the sake of diversity, but for the immense and all-too-often untapped business advantages they bring to the table.
