Diversity in the Boardroom
I recently had the opportunity to work with The Birmingham Post, a regional newspaper and several organisations in promoting board diversity. Together, we launched The ‘Diversity in the Boardroom’ campaign and pledge. The aim is to create a platform for organisations, across the private, public and voluntary sectors to commit to best practice in this area. Having been a board member and served many organisations for a number of years, I have continually seen a lack of diversity in the place of influence, which is typically at the top of an organisation.
As a governance consultant and previously as an accountant, I have acquired the skills to contribute to the boards of organisations in different sectors over the past twenty years. I have observed, like many other leaders in the city, the gaps in board composition. On these boards, I saw for myself the lack of younger faces and women. Additionally, most boards I encountered lacked representation from black and minority ethnic groups and in a city like Birmingham, this was not reflective of the community which those boards served. While the dedication and commitment of long standing board members who have served organisations for several years cannot be overlooked, this depth of knowledge and skill will be lost if it is not passed on to the next generation of leaders.
In my opinion, recruitment for board members should be based on competency, skill and experience. Competent board members are the most valuable resource in any organisation. However, if we aren’t proactive in finding the talent that is prevalent in various communities or we neglect to nurture the next generation of leaders, unfortunately the demographics of our current boards will not change for the foreseeable future.
The UK Charity Commission estimates that only 0.5% of the trustee population is made up of 18-24 year olds and the average age of a trustee is 57 years old. With Birmingham being the youngest major city in Europe and with under 25’s accounting for nearly 40% of its population, we must execute our recruitment practices in a way that emulates these facts. Failing to cultivate the skill and diversity that is necessary to ensure boards perform efficiently could have a negative impact on the long-term success of any organisation.
The Effective Board Member programmes (EBM), an initiative created and delivered by the governance forum, were designed to equip those people who want to contribute to the leadership of an organisation by becoming board members. EBM and similar initiatives only form the beginning of the journey to improve our boards. While the programmes offer the opportunity for people from all walks of life and with varying degrees of governance knowledge to gain an understanding of corporate governance, graduating competent individuals is ineffective unless they can contribute their knowledge to a board. Recruitment processes need to be reflective of an active commitment to bring these people on board. In relation to gender alone, Lord Davies, author of the 2011 report ‘Women on Boards’ stated that; “At the current rate of change, it will take over 70 years to achieve gender-balanced boardrooms in the UK.” That is not a legacy that I am comfortable leaving behind.
With this in mind, I believe that asking organisations to take the ‘Diversity in the Boardroom’ pledge demonstrates our collective commitment to secure a future where diversity in the boardroom is as important to us as the quality of service that we deliver. The pledge has been designed to act as a standard of good practice in the area of board recruitment. Organisations that take the pledge will demonstrate their commitment to review and update their policies and work towards creating a board and senior leadership team that reflects the diversity of the people they work with. Taking the pledge will sustain a culture that is inclusive; constantly ensuring the best people oversee governance in our society.
This is an exciting time for all of us. We have the opportunity to overcome the limitations of boards that confine their activities to those created from group think or passive perspectives to ones that benefit from the vitality, difference and brilliance that is missing on boards of all persuasions.
“Having multiple views on the possible outcomes of any action makes for a decision-making process that is more likely to take into account the various risks, consequences and implications of possible actions.”
Collectively, we can ensure the governance in our cities and beyond is open, transparent and adequately diverse to ensure the decisions we make minimise the risk of failure.
For more information about how you can take the pledge or register for our programmes, please visit effectiveboardmember.co.uk. You can also connect with us on Twitter @TheBoardEffect or @KGgovernance.
I look forward to championing ‘Diversity in the Boardroom’ with you.
Until next time…
