When men rule the table

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Any teacher knows the excuses children give for not completing a task, from grandma’s funerals to “the dog ate my homework”. The kids could take some inspiration from Britain’s biggest companies, judging by the rationale given for not hiring female directors, as seen in a new government study. Women don’t want “the hassle and pressure” of sitting at a table, they “struggle with complicated issues” and, anyway, “all the good women are already taken”. As the eponymous heroine of the film Shirley Valentine he said, “Aren’t people full of shit?”

Bartleby has a rather cynical view of dysfunctional leaders, recalling how Tiny Rowland dismissed them as “Christmas tree decorations”. They seem to fall into three camps: friends and acquaintances of the chairman, who will not challenge his authority; worthy public figures, who will not have enough experience to oppose management decisions; and managers from other companies, who would have enough knowledge of dissent, but who don’t have the time or the will to rock the boat.

But if the concept of non-executive leaders is to work at all, a wide range of opinions is needed to avoid “groupthink”. And the concept of a shortage of qualified women is a classic catch-22. If companies don’t hire women, they don’t get the experience.

Perhaps the most telling of the many excuses the board members had was “we already have one woman on the board, so we’re ready”. A paper* by Katherine Milkman and colleagues at Wharton concluded: “If organizations see gender diversity as a goal but tend to consider that goal satisfied once they match or just a ‘exceeding the levels of gender diversity of their peers, real gender diversity may be at risk. .”

Many more boards had two female directors than would be expected by chance alone. That’s probably because the average number of female directors on S&P 500 boards is 1.92, so any company with 2 directors can claim to have “more women than average”.

Clearly, companies are hiring women for show and not because they think it will add a competitive advantage. Some may argue that this is the “signal” market that does not help female directors and therefore it is a reasonable conclusion. However, there are a million reasons why companies may or may not succeed, from the economic climate to technology, and the composition of the board is probably only a small influence. But hiring more women could send a signal to both female employees and customers that the company is an inclusive employer. And there’s a chance that female leaders could help companies avoid the kind of marketing disaster like Bic pens for women.

* “Threshold Effects and Social Norms May Hinder Gender Diversity Efforts on US Corporate Boards, Making ‘Twokenism’ the New Tokenism” by Edward H. Chang , Katherine L. Milkman, 1, Dolly Chugh and Modupe Akinola

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