GENDER DIVERSITY:
Looking for differences on corporate boards
Gro Ladegård
1.
2.
Associate professor
UMB School of Economics and Business
3.
Oslo University College
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UNIVERSITETET FOR MILJØ- OG BIOVITENSKAP
Gender diversity: Why?
1.
2.
3.
4.
5.
Democratic argument: women are half of the population and
should not be systematically excluded from board positions
Legitimacy argument: women on the board advance the
firms’ reputation
Pool of resources argument: the larger the pool of
candidates, the easier to find suitable candidates
Competence argument: Women have different backgrounds
than men and contribute with different types of competences
Social role argument: Women have different social roles and
thus different attitudes and values than men. They will
contribute to a shift of focus in board tasks
3 and 4 requires that there are detectable differences between
men and women on the board that are manifested in
behaviour.
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Research on WOCB
 Human capital differences:
– Personal attributes (age, education)
– Professional experience (business, ownership and management experience
– External linkages (networks and interlocking directorates)
 Findings:
– Women directors are younger
– Less CEO experience
– Sometimes more non-business backgrounds, sometimes external, sometimes internal
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Human capital: Evidence from Canada
and USA
Number
Percent
Business Managers
Generalists
Specialists
Comm. Influentials
Insiders
63
45
37
32
16
32.6
23.3
19.2
16.6
8.3
Total
193
100.0
Business Managers
Specialists
Comm. Influentials
Dunn 2010:
Female directors in Canada
Number
Percent
Men
Women
Men
88
6
5
31
9
49
88.9
6.1
5
34.8
10.1
55.1
99
89
100
100
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Women
Hillman & Cannella 2002:
Fortune 1000 firms USA
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Evidence from Norway
Business Managers
Insiders (ownership)
Number
Percent
Men
Women
Men
Women
204
85
43
56
55
23
217
177
Heidenreich & Storvik 2010: Women on ASA boards
USA: Women, more than men, are community influentials
(non-business background). Men are typically business
managers
Norway: Women more often business managers. Men are
more often insiders: They are owners or represent owners.
Other relevant categories?
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Attitudes and behaviour: Difference in leadership styles
 Assumptions that women more communal in their behaviour:
– Philantropy
– Corporate social responsibility
– Strategic, qualitative tasks
– Contribute to open debate, less conflict
 Findings:
– Ratio of women on boards related to behavioural control, less conflict
– Men more autocratic and laissez-faire leadership, women more democratic
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Exploring differences in “quota boards”: Interviews
 11 companies that
– Existed and were ASAs in 2004 and 2010
– Had one or no women on the board in 2004 and 40% in 2010
– The board had 7 directors or more (40% is beyond the critical mass of 3)
 14 persons were interviewed, 8 men and 6
women
– Questions of tasks and human capital
– Comparing 2004-2010, and men-women
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Sample characteristics
Table 1
Sample characteristics: company, board and respondents
COMPANY A
COMPANY B
C OMPANY C
COMPANY D
Industry
Food/grocery
Electronic
medical records
Marine food
products
IT
No. of employees
20 000 (2007)
150
585
6000
2004
2010
2004
2010
2004
2010
2004
2010
Board size
8
8
5
7
6
7
8
9
Number of women
1
3
0
3
0
3
0
4
Male respondents
Female respondents
1* (10)
4 (3,3,13,7*)
2 (4,3*)
1 (5)
1 (4)
2 (3,1)
2 (8,3)
1(8*)
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Human capital
Table 2:
Education and industry experience
Women directors (6)
Men directors (8)
Formal
education
Master in business administration (2)
Law and business economics (1)
Master in agricultural science (2)( 1
also have MBA)
Master in economics (1)
Master in business administration (2)
Master in engineering (1)
Business administration (2) (1 also
with additional IT education)
Master in political science and public
law (1)
Physician (1)
Bio engineer (1)
Industry/
occupation
Politics (executive on environmental
issues)
Computer industry (executive on
innovation)
Transport (CEO)
Food/nutrition, R&D (CEO)
Technology (consultant)
Energy sector (CEO)
Food/grocery (CEO, chair on board)
International healthcare (Senior Vice
President)
Healthcare technology (CEO)
Investment (executive)
Telecom (senior vice president)
IT industry (product manager)
Government (assistant administrative
officer to mayor
Fish exports (CEO)
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Gender differences in human capital
 Level of education: all women had postgraduate, while 5 of the
8 men had. 2 women had additional education.
 Field of expertise/education: Men more different types of
education (e.g. medical doctor, political science, bio-engineer).
More men are specialists?
 Women more narrow experiences, and more women were
CEOs.
 Director experience: Women 3,33 years, men 6,8 years.
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Perceived differences
 Changes from 2004 to 2010:
– In 2004 women did not have sufficient human capital, today they have
– The women on their board have sufficent competence, but competent
women are hard to find
– Men and women differ in their opinions: the women say that men and
women have similar qualifications, while the men thinks there are few
women with sufficient qualifications. (what are the sufficient qualifications?)
– Professional experience should count before gender, but men mainly recruit
men.
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Perceived differences in board roles and tasks
 Strategic tasks: More strategic now, mostly because of the
NUES guidelines. The work is more rule-oriented
– External directors are more strategic, and women are more often external
directors.
 Monitoring tasks: Board members differ regarding their
emphasis on these tasks, and this is related to their
background and daily work.
– Monitoring role is conceptualised differently: Women say ”follow rules”, men
say ” control is important”.
– Two kinds of people: rule followers vs. value creators. Dependent on the
industry specific background
 Service tasks: The chairperson are the one giving advice to the
CEO, and only on request.
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Board culture and decision making culture
 Discussions: open discussions, all participate. More women and
more diverse boards make the discussions better.
 Men: women have other perspectives. Women: we contribute
to good discussions, not necessarily because we have different
perspectives.
 More pleasant atmosphere in discussions.
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Board development tasks and structure
 All prepare themselves better in 2010, but that is because of
the NUES guidelines. (some assert that women are more
diciplined than men, and that newcomers prepare themselves
better)
 No ”alliances” or hidden decisions between the meetings
 Structuring of tasks: Board work is more formalised now. 3 out
of 4 boards have a selection/recruitment committee.
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General perceptions
 One man:
– Women are more considerate than men
– Men are more risk-taking
 Listening skills: men feel women are better listeners, women
do not.
 Overall a better working atmosphere.
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Summary
 Women are more narrower recuited
 Have more education and are more often managers
 Men are more often owners
– Recruiters are risk averse, or stereotype
– The ideal type of a director has board experience and management
experience. Women do not have board experience: status balance requires
management role and higher education for women.
 Social roles, topics of interest, behaviours, appear to be similar
between men and women
– Board directors have well-defined roles, and the pre-selection is extensive.
– Stereotypical roles (women being more communal in their behavior) is not
supported
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Quota law
 The most important attribute for diversity is background and
experience
 Diversity on corporate boards has not increased, as women are
more narrowly recruited
 The total competence of each board may have increased, if
women replace less competent men (we do not know)
 Stereotyping is obviously common, as men and women often
have different opinions about gender differences
 The ideal type of a board director may be subject to change in
the future
 Recruitment processes could be investigated further
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