Post on 16-Jan-2023
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Women on Boards: Networking for Tapping the Talent
Research Proposal
Jay Partin, PhD
Managing Director
Diameter Group, Ltd.
San Diego, CA USA
PH: +1 – 619 – 356 - 0408
jpartin@diametergroup.com
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Introduction
The role of women in modern society and in the workplace, in particular, has been the object
of much debate and deliberation since the industrial revolution of the 18th
century. Their
workforce participation rates increased following World War I and World War II to the point
that some women now occupy the highest seats of authority and responsibility in the
corporate world. Those that have achieved those positions didn’t get there easily and many
more have tried to rise to those ranks but were not able to do so for a multitude of reasons,
some personal, some societal, and many for lack of a career path to reach that destination.
Helping to fill this vacuum or void with more certain knowledge and useful tools is the
overall goal of this research.
Women are now engaged in the workforce in larger numbers than ever before. According to
the World Bank’s 2012 Gender Equality and Development Report the number of women in
the workforce has increased dramatically, reaching an 80% participation in the richest
countries. However, the percentage of women who attain the ranks of senior management or
board of director membership is a very small percent. The general purpose of this research
proposal is to attempt to ascertain why this happens, how it happens and what can be done to
change it, namely, increase the number of women on boards of directors. There are numerous
studies that have investigated the causes of under-representation of women in executive
director positions. The explanations range from broad social issues to situation-specific
reasons that determine whether there will be any female directors or, if so, who and how
many.
On a societal basis, the major factors as to why there are so few women directors are twofold:
1) men have historically run businesses and the company boards of directors were an
exclusive domain for men and 2) psychologically, the boards valued cohesion and
conformity, both of which are difficult to achieve with representation from dissimilar
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backgrounds and values. Seeing no business reason to change, they continued to be all male
clubs until relatively recent times, largely the results of the women’s movement that reached
a critical mass in the 1960’s and has culminated in the recent actions by such organizations as
the Lord Davies Report (2010) and US Securities and Exchange Commission
(2009). These
and their European counterparts have issued directives, guidelines and goals with timetables
to facilitate significant increases in minority and women representation on boards of
directors. Interest groups seeking greater board diversity are tracking progress and pressuring
private and public entities to comply.
There are many explanations that have been offered to describe why so few women are
directors. Some of the reasons are the basis for a lot of research that will be included in this
study. They can all be categorised under the general term, “bias.” Bias against women and
minorities who, because of gender or colour, do not have the same experience, requisite
skills, social standing or other attribute that would fit in with the in-group. Kim (2007)
summarised the reasons for lack of diversity for women in management in three ways: 1) the
person centered perspective looks at the position requirements and concludes that the woman
lacks managerial traits, competence and career aspirations needed for advancement. 2) the
organization centered perspective concludes that the practices and dynamics of the
organization doesn’t fit with women, and 3) the institutional perspective focuses on the
impacts of societal and/or cultural values on the organization's perception of managerial
women. These same general arguments have been used in the past to rationalise why women
aren’t suited for board membership. On closer examination, one can see that these all have a
flawed logic and do not hold up to close scrutiny.
As to the person-centered perspective, that argument fails if one performs an objective job
analysis and identifies the actual knowledge, skills, traits and abilities that are required to
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perform the job and assesses the degree of fit the person, male or female, has for that job. The
lack of an objective position assessment and selection process is a primary reason why so few
women are selected for director positions. Arbitrarily assigning value to traditional male
trains as director job requirements will eliminate most women. Similarly, allowing Chairmen
and other board members to recommend people like them will disqualify anyone out of their
network. Heilman and Haynes (2005) have shown that woman can perform as well as men on
common tasks if they have accurate knowledge and information. As this research will show,
stereotypes about women as leaders are unfounded and new evidence shows a distinct style to
complement others.
As to the organization-centered perspective, that explanation assumes that systems,
procedures and methods are best understood by men who designed them and that women lack
the experience, understanding and aptitude to perform to the same standards as men. Kanter
(1977) found that performance in organizations favour men because they have access to
information networks typically unavailable to women, thus contributing to their lesser ability
to perform. The same principle applies to board membership for women. If they are denied
access to top management positions, serve in “trophy” roles, they will not be able to qualify
for position descriptions that prescribe experience levels they are unable to acquire.
The institutional perspective is a function of old social mores that led to stereotyping that has
prevented women to have access to the types of programmes, educational experiences and
jobs that would prepare them for senior management roles and directorships. This is a
cultural artifact that has changed slowly and will continue at its own pace unless the
corrective actions now underway are fully implemented and sustained.
This is a general description of the environment that now exists and which will need to
change in order for greater diversity to occur on corporate boards. Some of the efforts that
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have been taken have produced positive results. Participation rates by women have steadily
increased over the past two decades, although slowly. Boards with one or more women now
show that at the end of the last decade of the 20th
century, some progress had been made
(Daily et al 1999). The average number of women in Fortune 500 boards doubled between
1986 and 1987. More recent data from the Women on Boards Report (2011) show that
females now compose 12.5% of the members of the corporate boards of FTSE 100
companies. Norway is the country leader at the moment with a 40% participation rate of
women.
These results show that something can be done to effect change on corporate board
membership. The questions still remain as to what works and how to implement them. There
are many answers to those questions because several things have been tired and all have
worked to varying degrees. Burgess and Tharenou (2002) and Mattis (2000) reviewed the
results of several programmes implemented by Fortune 500 companies and summarised the
programmes they undertook to affect boardroom diversity. The actions can be summarised
as: 1) redefining pool eligibility, 2) internal company promotions via career ladders, 2)
objectifying the selection process, and 4) involve women in subcommittees having to do with
central and core business issues.
These were not done for altogether altruistic reasons “because it was the right thing to do.”
There are also legitimate business reasons for doing so. The benefits of adding women and
minorities to corporate directorships have been widely investigated and identified some
tangible benefits while not being able to substantiate some claims. Perhaps the most
quantifiable study was done by Credit Suisse Research Institute (2011) in which they were
able to verify that companies with at least 1 woman on their board, over a 5 year period,
could benefit as follows: 1) Higher return on equity (ROE) @16%, 2) Higher Price to Book
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Values (P/BV) Multiples = 2.4x, and 3) Higher average growth (14%). They also suggested
that non-financial benefits included: 1) A signal of a better company, 2) greater effort across
the board, 3) a better mix of leadership skills, 4) access to a wider pool of talent, 5) a better
reflection of the consumer decision-maker, 6) improved corporate governance, and 7) risk
aversion. These results were further bolstered by Professor Nick Wilson of Leeds University
Business School who stated that having 1 or more women on the board could reduce
bankruptcy risk by 20% or more.
With potential benefits like this and the prospect of having legislative mandates that go
beyond the present suggestions and disclosure requirements of the regulatory bodies’ recent
actions, there are serious efforts in process to find more qualified women outside directors. In
addition to announced board member additions, executive search firms have adopted a
Voluntary Code of Contact and have expanded their operations to meet increased demands.
With the demand for women on boards increasing and a knowledge that qualified candidates
are in scarce supply, how are the needs going to be met? There are a few options that are now
being used. The fundamental strategy is to change the selection criteria. A concomitant
change is to conduct a thorough needs analysis and commission qualified resources to recruit
and verify candidates that meet the specifications. Such a process would need to be disclosed
inside the board and to those with a need to know. Once agreed to, the search would begin by
identifying talent pools and selecting the best qualified candidates. This is an initiative that
organizations can take, but what can an interested board prospect do to enhance her prospects
of qualifying and being discovered? That is the aim of this research.
In the past, board positions were usually filled by the Chairman from among his direct
contacts or contacts in his board’s networks. Depending on the power of the Chairman, he
usually had the power to influence the choice to fill any vacancy. If the Chairman is weaker
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than the board, he would most likely need a consensus or a majority of the board to concur
with his recommendation. The process is an example of “old boy,” closed group networking
that has created corporate boards for decades. It is an efficient system. Only like-minded
males with similar work experience, education, age, ethnicity and values can expect to be
accepted for membership.
Literature Review
We have seen that networking works for men, but, if women don’t belong to those networks,
how can they ever gain access to corporate board rooms? If corporations were inclined to
breach the gender barrier, how can they establish linkages with viable candidates? Several
studies have been done that show ways that women can network themselves into those
circles. Forret and Dougherty (2004) determined that “network behaviours,” defined as
“individuals’ attempts to develop and maintain relationships with others who have the
potential to assist them in their work or career.” Their study examined 5 types of networking
behaviours: maintaining contacts, socializing, engaging in professional activities,
participating in community, and increasing internal visibility. Results showed that men and
women network differently and with different results. Those who were able to increase their
internal visibility by engaging in high profile projects received more promotions and
increased compensation. Maintaining external contacts and involvement in community
activities had a positive effect on career advancement, but more so for men than women.
Does this mean the women are less effective in managing their networks than men and if so,
why?
Searching for a director level position is similar to searching for a job. It involves many of the
same techniques. It requires communication, information gathering, and contact with
individuals and organizations that have openings to fill. This research proposal assumes that
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networking is an essential component of enabling women to achieve greater access to director
positions and that better understanding and utilising the networking process will facilitate that
goal. We will conduct a survey of perceptions as to what factors are important for board
positions, size and composition of social networks, how these are related and how they may
affect board search and selection processes. We also expect to find estimation of required
search intensity as measured by time. Hoye et al (2007) found that the size of one’s network
and the intensity or strength of the relationships affects the outcome of the search. It affects
the level of the organization contact and helps determine the level of introduction into the
organization. People with a higher status in terms of education and status are likely to provide
greater assistance and more valuable information (Aguilera, 2002; Reingold, 1999).
Wanberg, Kanfer, and Banas (2000) described the intensity of networking that is required for
job search success.
The model for this process of networking and job search is described in the Appendix, Figure
1. It is based on an integration of networking principles and modified social exchange theory.
The social exchange theory was originated by Homans (1961) and Blau (1964) was that value
is given for value received (i.e. reciprocity). We have combined that concept with a
networking model to explain how someone might approach the prospect of obtaining a
directorship on a board of directors. The major actors and their roles are accounted for in this
scenario. The model describes the flow of information in the system and how it can be
accessed by aspiring board members.
Research Methods
This study will set out to determine the networking process that was used by incumbent board
members to obtain their appointment as well as determine the networking strategies in use by
persons now seeking director positions. The focus will be on how individual networks are
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defined, how they are utilised in seeking or maintaining board relationships. The design calls
for a combination of personal interviews of 5 men and 5 women who are either board
members or seeking appointments and survey of a population of 30 persons who are seeking
board appointments.
The specific aims of the research are to answer these questions.
1. What networking methods do you use/recommend for business contacts?
2. What methods are most effective for maintaining visibility among those you wish be
associated with?
3. What personal attributes or qualities are perceived to be most attractive for
prospective board candidates?
4. How can the answers to these questions be used to identify ways to facilitate better
access for women into corporate board networks?
A two part questionnaire consisting of approximately 30 items will be given to each
participant. (Appendix, Survey Questionnaire Part 1 and Survey Questionnaire Part 2) The
questionnaire will consist of both categorical item responses (demographics) and 5 point
Likert scales using descriptors such as “Almost Always” to “Infrequently,” with a “Not at
All’ option. The questions are based in part on research done by Sheridan and Milgate (2005)
in which they examined corporate practices when considering adding women to the board of
directors, the qualities they look for and how they are addressed. Hoye (2007) developed a
method for measuring the strength and effectiveness of networking models used in job
searches. The research model will employ features of both to form a new networking model
with a specific application for board level job search.
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Hypotheses that will be tested:
Hypothesis 1: Internal/Subjective Items will be rated higher than External/Objective Items
Hypothesis 2: Current board members referred by Chairman or board members will
recommend less time for networking.
Hypothesis 3: Prospective board members will rate internal/subjective items higher than
external/objective items.
Hypothesis 4: There will be no difference between the ratings of current or prospective board
members on organization selection requirements.
Hypothesis 5: Network size will be positively associated with time spent networking.
Hypothesis 6: Tie strength will be positively associated with time spent networking.
Hypothesis 7: Tie status will be positively associated with time spent networking.
Hypothesis 8: Men will rate themselves highest in network size, strength and status.
Means, standard deviations, and correlations among all variables will be computed using
Cronbach alpha, t-tests, ANOVA and factor analysis.
Success models will be developed in terms of what worked for current directors and
consensus models for those who are currently seeking director positions.
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Appendix
Demographic Survey Questions
Gender
� Male
� Female
What is your current position?
� Existing board member
� Aspiring board member
Are you
� Non Executive Director
� Corporate Director
How many NEDs do you hold
� 1-3
� 4-6
� 7-10
� 10+
Highest level of education achieved
� College graduate
� Graduate school
Survey Questionnaire Part 1
Almost Always
Very Often
Sometimes Infrequently Not at
All
What do you believe is the most crucial in
attaining a board position?
Strong track record
Business contacts
Good understanding of general business principles
Intelligence
Communication qualities
Objectivity
Integrity
Leadership qualities
Advanced educational background
Involvement with not for profit or community
organization
Diplomacy and tact
How to be brought to the attention of the board? Almost Always
Very Often
Sometimes Infrequently Not at
All
Recommended by Chairman
Recommended by board member of company
Recommended by board member of own company
Was shareholder of company
Had family affiliation with company
Recruited by executive search firm
Don’t know
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For Current Board Members Almost Always
Very Often
Sometimes Infrequently Not at
All
Why do you think you were selected as director?
Possess desired area of expertise
Hold appropriate job title/leadership position
Have high visibility
Fit desired regional profile for board member
Have corporate board experience
Have not-for-profit experience
Be a member of a minority group
Don’t know
For Prospective Board Members
What do you think it takes to be selected as
director? Almost Always
Very Often
Sometimes Infrequently Not at
All
Possess desired area of expertise
Hold appropriate job title/leadership position
Have high visibility
Fit desired regional profile for board member
Have corporate board experience
Have not-for-profit experience
Be a member of a minority group
Don’t know
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Survey Questionnaire Part 2
• Each item will have an appropriate Likert scale
Network size* 1. I know a lot of people who might help me
find a Board position.
2. I can count on many relatives, friends, or
acquaintances for information about Boards.
3. I know few people who might help me
search for a Board position (reverse coded).
4. I have connections I can talk to about
helping me find a Board position.
Tie strength* Most people who might help me find a
Board position:
1. Are people I know very well, such as
family or friends.
2. Are people I often talk to.
3. Are people I feel comfortable talking to,
even about sensitive subjects.
Tie status* Most people who might help me find a
Board position:
1. Have received a good education.
2. Have a good Board position themselves.
3. Are generally doing well in life.
Networking Over a three month period, how much time
would you recommend spending on
networking to facilitate getting a director
position: _____ hours or _____ days