BOARDS ARE TAKING ON more strategic roles within their companies, but many of them aren’t prepared to handle global risks, and most of them aren’t as diverse as they need to be. Those are among the findings of the 2016 Global Board of Directors Survey released in April by Boris Groysberg, the Richard P. Chapman Professor of Business Administration at Harvard Business School in Boston, Massachusetts; Jocelin Yo-Jud Cheng, a doctoral candidate at HBS; executive search firm Spencer Stuart; the WomenCorporateDirectors (WCD) Foundation; and researcher Deborah Bell. The survey gathered responses from more than 4,000 male and female directors in 60 countries.
According to respondents, there is a “gap between best practice and reality” when it comes to the ability of boards to handle strategic challenges, especially regarding talent issues. For instance, both public and private company directors named “attracting and retaining top talent” as one of their top strategic goals; yet most gave their own boards relatively low ratings on talent issues such as board diversity, HR/talent management, CEO succession planning, and director evaluations.
9% of male directors support boardroom diversity quotas.
The report also found that the top three issues board directors consider most relevant are the economy, the regulatory environment, and cybersecurity. Women are more concerned about risk than male directors, and women are also the ones pushing for more formalized mechanisms for board turnover, such as setting retirement ages and term limits.
Regarding a lack of diversity on boards, the researchers noted that private and public companies tend to have similar proportions of female and ethnic minority directors on their boards and asked why the number of women on boards is not increasing. Older male respondents cited the “lack of qualified female candidates” as the primary reason; women believed that it came down to the fact that diversity is not a priority in board recruiting; and men under the age of 55 said that the reason was that traditional networks tend to be male-dominated. Another problem might be that boardroom diversity quotas aren’t popular: 49 percent of female directors support them, but only 9 percent of male directors do.
Download the report at www.womencorporatedirectors.com/page/_2016boardsurvey.