Peter Grauer, Chairman of Bloomberg, states, “In business we have targets for performance. Board diversity should be no different. A company needs to be able to measure results and benchmark them against the industry. I should want to be better than my competitor on diversity because I know it will lead to better outcomes”.
Left to Right: Dennis McCuistion, Deborah L. DeHaas, and Billie Ida Williamson
Diversity of perspectives in the boardroom supposedly lead to better dynamics and governance. In a study of more than 100 of the Fortune 250 companies a board composed of directors representing a range of perspectives results in an environment of collaborative tension that is the essence of good governance. In a room where everyone has different points of view and there is a greater opportunity for cross-pollination of ideas, there are fewer unspoken assumptions, less “group think” and a greater likelihood of innovation (source).
While diversity is about much more than gender, according to the
2020 Gender Diversity Index (GDI), in 801 active GDI companies, women now hold 20.8% of board seats, an increase from 19.7% in 2016 and 14.6% in 2011, A.G. Lafley, Executive Chairman, the
Procter & Gamble Company says, “It’s simply good business to bring more women onto corporate boards. In P&G’s case, we want the best minds bringing external perspective, challenging our thinking, and adding their diverse points of view”.
Still it’s not clear that male and female board members differ all that much in their values, experiences, and knowledge (
source).
Joining host Dennis McCuistion to talk about the critical role diversity and relationships play in good governance are:
- Deborah L. DeHaas, Vice Chair and Chief Inclusion Officer, Managing Partner; Center for Board Effectiveness, Deloitte and
- Billie Ida Williamson, Forrester and Company. Our expert’s state, an inclusive environment increases a board’s effectiveness.
Our expert’s state, an inclusive environment increases a board’s effectiveness.
According to our experts, Diversity is also about the asking of good questions. Yet, if everyone on a board looks the same, are of a certain age, have the same work/professional experience and education, the variety of answers needed for good decision making is missing.
With diverse experience, cultures, and industry knowledge people have different viewpoints from which to address what really matters regarding a company’s well-being. Age diversity is also a factor. The average director’s age at most big U.S. companies is 63 plus. With technology at the hub of most businesses generational diversity, having younger board members who understand technological change is critical.
Global economies need to be innovative, with constant thought applied to what the customer wants, what could disrupt the business, cyber security risks, competition; the list is endless. The business world today is especially fraught with change and uncertainty. Diversity contributes to overall good corporate governance, where the company has the people, processes, resources, and culture to enable a thoughtful, proactive focus on strategy, customers, operations, and risk and thus maximize the opportunity for all stakeholder groups.
Special thanks to the generosity of The Hatton W. Sumner’s Foundation, Inc. and our other donors. The McCuistion Program, a 501 (C) (3) tax exempt organization does not receive any KERA pledge dollars, PBS funds or government grants. It is their generosity and our viewers which has kept us on the air for 28 plus years. Thank you for your continued support.
Be sure to watch more McCuistion TV programs on our website www.McCuistionTV.com.
Thanks for joining us,
Niki McCuistion
Co-Founder, Executive Producer, Producer
Business Consultant / Executive Coach, specializing in Organizational Culture Change, Governance and Strategic Planning
214-750-5157
www.nikimccuistion.com
nikin@nikimccuistion.com
***
2406 – Originally aired 07.09.17
