Boardrooms Diversity: Focusing on the Bottom Line
May 29, 2013
NEW YORK — April 9, 2012 – Women are bringing a much needed source of emotional intelligence (EI) to the boardroom table and as a result improving a board’s ability to innovate, make consensual decisions and connect with customers and staff according to a survey by Inspire, the business network for senior board-level women supported by Harvey Nash.
The survey, Return on Diversity, completed by 326 board-level executives across 19 countries, revealed that almost two-thirds of respondents (64 percent) believe women are bringing a greater level of EI to the board, which in turn brings greater cultural understanding (91 percent believed better EI boosted the board’s ability in this area), better board consensus (80 percent) and greater creativity and innovation (75 percent).
In addition, the survey revealed that 92 percent of survey respondents believe that women bring new and different perspectives to the board, with participants’ comments ranging from how women take a different approach to risk to how women offer greater pragmatism in decision making.
While most respondents agreed greater EI at the board level had a positive impact on the soft attributes of the board, less consensus surfaced on how this affected other attributes. For instance, regarding a board’s ability to make bold decisions, most (60 percent) respondents believed having greater board EI had no affect or for 12 percent of respondents had a negative effect. This was even more pronounced when looking at speed of decision making where 68 percent believed EI had no positive effect, and 13 percent felt it was negative.
Carol Rosati, co-founder of Inspire and director of Harvey Nash, said: “At a time when companies are desperately seeking new ways to create revenue streams through innovation and entering new markets, the need for creative thinking and cultural understanding of customers and staff has never been greater. This survey shows that companies bringing women onto boards can be one way they achieve great board emotional intelligence, and in turn better board effectiveness.
Simultaneously the survey shows greater board EI is an overwhelmingly positive thing, and it also shows that EI can make boards operate differently. Boards must recognize that becoming diverse is more than just a change in their makeup; it can often create a change in their approach altogether.”
The survey also looked at how to achieve greater female board membership. Respondents overwhelmingly rejected the idea of government quotas (only 6 percent supported this option) preferring the emphasis to be on companies to cultivate and develop their own female talent pipeline (48 percent). A further 29 percent of respondents believed the main barrier to female progression is the attitude among C-level male executives.
Alexa Bailey, co-founder of Inspire and consultant at Harvey Nash, said: “Women are not looking for a prop to help them into senior roles but instead, a change in attitude from the board itself. A specific case in point is the Nomination and Governance appointment Committee. All too often the selection criteria for new board members is based on whether the person has had previous experience at board level, rather than does this person have the right set of skills and values to do the job? It’s an important difference especially if we are going to evolve the talent pipeline for future board leaders. Another change is around support given in both the domestic and professional sphere. Achieving gender balance in the boardroom and at the executive level requires support both in the workplace and at home, where domestic support services, childcare and supportive partners have a powerful impact on an executive’s ability to focus on work.”
About Inspire’s Return on Diversity report
The survey was conducted online from November 2011 to January 2012 and reflected the views of 326 senior decision makers made up of 17 percent CEOs, 31 percent board-level executives, 20 percent non-executive directors and 32 percent executives in other categories.
Seventy-seven percent of responses were from the UK and the U.S., with the remaining spread among 17 other countries.
Inspire’s Report Return on Diversity contains the key findings from the survey as well as detailed commentary from:
- E. Mervyn Davies – Lord Davies of Abersoch
- Umran Beba – CEO, PepsiCo Asia Pacific
- Allan Cook – Chairman, WS Atkins
- Mary R. “Nina” Henderson – Trustee, Drexel University and Drexel College of Medicine, Director, Visiting Nurse Service New York
- Diana Brightmore-Armour – CEO, Corporate Banking, Lloyds Banking Group
- Eva Au – MD, IDC Asia / Pacific Astrid Clifford, CEO, HSBC Bank Armenia
- Fiona Woolf CBE – Alderman, City of London Corporation
- Lady Susan Rice CBE – MD, Lloyds Banking Group, Scotland
- Marie Staunton – CEO, Plan UK
- Benjamin Akande Ph.D – Dean of Webster University’s George Herbert Walker School of Business & Technology