Board diversity, always a subject of interest and debate, is again hugely topical, with some of what has emerged from the current Royal Commission into our banking and financial institutions.
— Governance Matters (@GovernanceMatt) June 4, 2018
The topicality this time is driven by what I would like to think is pure coincidence but, sadly, I fear has plenty to do with something far more sinister and murky – and it’s that latent misogyny still has a pulse in corporate Australia.
The recent backlash on female board members as evidenced at AMP has seen some return to the hoary old argument that the travails of a few of our financial institutions can be traced back to society’s push for gender equality.
The argument says we’ve sacrificed merit on the altar of social engineering, and the inevitable result is people (read women) in positions they’re ill-equipped to hold.
While I am the first to argue that industry knowledge is critical and if a company operates in a certain industry, there is an absolute need for several of the directors to have a deep and long exposure to that sector and a need for a broader knowledge of contemporary issues affecting a company!
The two can – and should – co-exist: sector-specific expertise and broader expertise.
That’s the real issue, not gender.
At the same time, we should have moved way beyond gender in the diversity debate and recognised other aspects of variety. We should have noted that, in most boards, those around the table are predominantly Anglo-Saxon heterosexuals of a certain age demographic.
What about ethnic diversity? Or LGBTI diversity?
I am reminded of a large health sector client with its major hospital in a neighbourhood with a predominantly Asian population. It came as something of a shock to the board when I expressed my surprise that the board did not have a single director of Asian descent.
They looked a little nonplussed when I suggested that it might be beneficial for all concerned that the board was a little more reflective of the majority of the community it served.
The time had well and truly come for them to have a serious conversation around someone with an ethnic background who might bring the desired skills to the board.
After all, respected research has provided us with enough compelling evidence to vindicate the view that where there are diverse, highly skilled boards, they tend to deliver better results than equally skilled homogenous boards.
If we take diversity beyond just gender diversity, imagine how much better our results might be?
That’s my challenge today – let’s remember the words of Canadian Prime Minister Justin Trudeau when questioned a few years back on his new gender-balanced Cabinet, offered a simple explanation: “Because it’s 2015”.
It’s now 2018…
Until next time,