I am particularly glad to read this great article as it relates to the US and the tech industry, both rightly considered a cradle for merit and competency-based choices. In fact, focusing on increasing gender diversity at board level would be greatly beneficial for merit. Let me briefly comment on a couple of aspects:
- In addition to valid and interesting research, as that from Credit Suisse and several more examples, selecting talented women for Non Executive Director positions is a phenomenal way to emphasise merit in the selection of Non Executive Directors.
Even in countries like the US, or sectors as tech, which have considered “merit” as a driving compass in selecting people, the percentage of women on boards has barely moved past the 15% mark.
Focusing on selecting more women can be purely revolutionary, as it will increase choices based on leadership competencies.
Let me bring in the case of Italy. We have recently introduced a law, in essence requiring, since 12 August 2012, Italian listed or State-controlled companies to appoint a fifth (to become a third at the following mandate) of board members as part of the “under represented gender”. This law has been implemented earlier by a number of Italian corporates, during the Annual General Meeting season of 2012: exceptional women were selected. As shareholders were nudged by the law towards changing some board members, they realised they would be better off by selecting them on the basis of merit and competency;
- Another great result was that overall corporate governance improved. As this law mandates for shareholders to change a number of board members, Italian companies have rightly taken it as a great opportunity to make better use of their Boards. Hence, some leading Italian global companies, such as Fiat Chrysler for example, implemented a smaller board, with a view to fostering its effectiveness.
- As a final remark, let me repeat one of my mantras: exceptional female talent is ever more crucial, in one of those defining moments, as difficult as they are, where proper and effective use of talent and leadership can, and will make a difference for the better. More on this here: http://wp.me/p2mHJv-28 .
In the mid-1950s, economist Harry M. Markowitz first described how investors could reduce their overall risk by filling their portfolio with securities that do not usually move in the same direction. As with all significant economic research, Markowitz (who was later awarded a Nobel prize in economics for his work in portfolio theory) proved mathematically what every good grandmother has known for centuries — don’t put all your eggs in one basket. Or, if you prefer to listen to your Sunday school teacher, take a look at what King Solomon, one of the richest men of his time, wrote in the book of Ecclesiastes, “Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.”
Now what does this have to do with your boardroom? Plenty, if you read the new report by the Credit Suisse Research Institute. The…
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