Monthly Archives: February 2014

Two or three things I think when people mention “Golden Skirts” to me

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On a couple of recent occasions, I was  asked  about what is commonly defined as the “golden skirts” phenomenon, whether there’s a risk of some female non-executive directors taking on too many Board roles as a result of a law on #DiverseBoards (this is another one of many possible definitions).

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I would warn to be skeptical. I would even go as far as to say that this is a clear instance of unconscious biases at play. We look at women in a different, more biased way than we would normally look at men.

The expression “Golden skirts” has the very same unconsciously negative overtones as expressions such as “pink” quotas and the like. Unconsciously, similarity bias makes us fear adding diverse members to the board.

There might be women taking on too many board positions, exactly as there might be many men who do the same. Nothing to do with gender nor with the law. Let’s note, though, that we do not seem we use a similar “gender” stereotype as that of a “golden skirt” when we describe such a phenomenon when it involves men.

Even if we assumed, for the sake of the argument, that there might be cases of women taking on an excessive number of non-executive board positions, under no circumstances would this imply scarcity of female talent or a peculiar behavior of women.

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In addition, we need to be extremely careful. If you properly look for it, and manage to overcome unconscious biases, female talent is abundant so that there is no risk that women take on too many board positions as there is too little talent to meet demand.

In the country where I live, where a law on #DiverseBoards has been in place since 2012, we haven’t observed this phenomenon amongst women any differently than we would observe it amongst men. I would even go as far as to say that in my personal professional experience, I have encountered in women an extreme level of care about not taking on too many board seats, thereby running the risk of dedicating too little time to any single given board position they hold. Not for a reason of gender, we should note. Rather, as women have approached Board roles with more insight, as they have “raised the standards” in terms of preparing for a board seat. From now on, even men will have to do the same.

Reducing unconscious biases. Raising talent, merit, competencies, improving corporate governance. This is what #DiverseBoards is all about.

Tommaso Arenare

www.twitter.com/tommaso_arenare

A couple of things we learn from a law on #diverseboards

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I was recently asked what lessons we learn from the implementation of Italy’s law 120/2011 fostering gender Diversity on corporate Boards (so-called “Golfo Mosca” law).

In summary, this law provided an unexpected positive nudge to the country’s very perception on gender diversity, as well as to its corporate governance.

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Let me comment on both aspects.

Improving the stance on Gender Diversity through reducing unconscious biases

Humanity is thought to have taken its modern form some 200,000 years ago. Back then, when we used to live in the Savannah, in small closely-knit family groups, most of our key decisions were about our “fight or flight” dilemma, when we would face dangerous animals or other dangerous human beings and we had to decide, in as little time as possible, if the best way to save our lives was to “fight” for survival or else “flight away”.

A “snap judgment“, as the word implies, is our unconscious habit to make a decision about people, or reacting to people, in a matter of very few seconds after we meet with that someone or we face the situation we consider as a challenge. A snap judgment is a very precious and important habit, which we have developed over millennia of evolution.

Separately, “similarity bias” happens when we select people that are more similar to us, as opposed to people who appear more different. Evolution has fostered this trait, as a key manner to survive ever since the difficult times when we would live in the Savannah, trying to escape from animals and all sorts of dangers.

The combination of snap judgments and similarity biases is the one reason why gender diversity (but also age diversity, geographic diversity and possibly many other aspects of diversity) is so difficult to happen without a little nudge (such as that of a proper law). The “Golfo-Mosca” law forced shareholders to select new members of the board from the “under-represented gender”, overcoming unconscious fears, to the advantage of merit, competencies and corporate governance.

Without the proper nudge of a similar law, countries that are rightly considered as a cradle for merit and competency-based choices, such as the UK or the US, have not been able to move the presence of women boards swiftly to anywhere above the 15 to 17% mark (end of 2013) as opposed to about 20% in Italy over the same period.

Improving Corporate Governance

Another great result of Italy’s “Golfo-Mosca” law was that overall corporate governance improved. Some leading Italian companies have rightly taken the law as a great opportunity to reduce the number of board members, so as to make better use of their boards. FIAT Chrysler for example, reduced the number of its board members from 16 to 9 in 2012, thereby making it more effective as well as smaller.

We have also seen the development of several training programs for candidates to the position of non-executive director (with Valore D’s “In the Boardroom” being particularly dear to me, as you will read in a separate section).
This actually sets a new benchmark not only for women but for men as well. If shareholders have to select new board members, all things remaining equal, they would inevitably prefer to select candidates that have gone through specific training.

The real next step is to bring gender diversity down from boards to executive levels. We need to foster mentoring as a way to ensure that when it comes to promoting talent, women are in a similar position as men. Similarity bias, as we have described above, impacts very much on the promotion of executives. We want to intervene to reduce the impact of similarity bias in favour of promotions based on talent and merit.

Tommaso Arenare

www.twitter.com/tommaso_arenare