April 24, 2012 by Darry Marengere — Guest Blog:
Gender equality on boards of directors remains an issue.
On March 29, 2012 the federal government announced that as part of its 2012-2013 budget it was creating an advisory council of business leaders to promote the presence of women on corporate boards of directors.
The budget noted that although women in this country have reached the senior ranks of business they remain in the minority on corporate boards.
This month Marengere Group shines the analytical spotlight on women in the boardroom and asks the questions “Where are we?” The answer is in the form of an infographic detailing the situation of gender equality – or lack of – in the Canadian C-Suite.
The women’s advocacy group Catalyst concluded from a 2011 study that the proportion of women on Canadian boards rose only half a percentage point between 2009 and 2011. Women currently hold just 14.5 per cent of board seats in Financial Post 500 companies, it said, and 10.3 per cent in public companies. Additionally, nearly 40 per cent of FP500 companies and over 46 per cent of public FP500 companies have zero women serving on their boards.
Why? Canadian universities have been producing a fairly equal number of men and women business grads for years.
The answer is involved and detailed in the infographic, but the big question these days is what to do about it.
Norway is a celebrated example of the use of quotas to promote gender equality in the boardroom. It passed a law which catapulted women’s share of seats from 9 per cent in 2003 to the required 40 per cent now. Quebec passed a similar quota in 2006 for its crown corporations; today the proportion of women on those boards is 42 per cent.
Replicated studies have shown that a diverse board – and certainly, a gender diverse one – increases profitability. It also increases accountability by establishing measures such as a code of conduct and conflict of interest guidelines.
The use of quotas, however, remains controversial. European Union justice commissioner Viviane Reding, for example, is giving “self-regulation a last chance. I would like companies to be creative so that regulators do not have to become creative.”
In the meantime, various non-governmental organizations have issued recommendations, as detailed in the infographic, and as I mentioned in an earlier story, organizational culture may be the largest culprit. As the Ivey Business Journal Online put it “In the current cultural environment, the playing field is not level.”
Quit hogging the ball, guys.
About Darry Marengere — Business and health care analyst who likes to write stories for you to be informed, laugh, share, and brighten your day.