New Initiative to Increase Diversity on Director Candidate Slates

By Melissa J. Anderson (New York City)

Earlier this week, almost three hundred women board directors gathered at the second annual WomenCorporateDirectors Global Institute to discuss issues that corporations are facing in an increasingly global and complex marketplace.

Last year, the organization, composed of over 1,400 women in 42 chapters around the world, put forth a call to action to increase board diversity. In order to do so, this year, the group announced its newest project: the WCD Global Nominating Commission, a task force of CEOS and nominating committee chairs from top corporate boards, which will focus on increasing diversity on candidate slates for directorships.

Henrietta H. Fore, global co-chair of WCD, CEO and chairman of Holsman International, and a director at ExxonMobil and Theravance, Inc, said, “With the Commission, we are taking on the next challenge – urging nominating committees, who determine the composition of the board, to focus on global diversity.”

She added, “We will work with these important decision-makers in a whole new way.”

Alison A. Winter, global co-chair and co-founder of WCD and a director at Nordstrom, added, “With greater demand on boards and from boards to increase diversity, the Global Nominating Commission will be an important center of influence for nominating committees worldwide.”

Increasing diversity on candidate slates has been touted as a way to build more diverse boards, without resorting to quota rules that have been adopted in countries in Europe and Asia. Board diversity has been shown time and time again to drive better decision-making and has been correlated with increased corporate revenues.

Based on the challenges that corporations will face in the coming years, diversity can only improve boards’ ability to tackle the tangled web of global opportunities that lie ahead.

Leadership and Change

Opening the summit, Co-Founder and Global Co-Chair of WomenCorporateDirectors Susan Stautberg said, “To be a leader is isolating, and doubly so if you’re a woman.”

That’s one reason the group was founded – to enable women directors to connect and share advice and best practices on pertinent issues that leaders face. “Directors need help as we prepare for the ups and downs of the future,” she said, such as building the employee engagement of Gen Y, tapping into the rapid growth of emerging markets, and managing slower growth in mature markets.

Not only that, she continued, but the time when Western directors can claim ownership of best practices is over. Directors must be willing to listen to their global counterparts in order to approach the issues that are shaping today’s business environment.

She added, “Now, more than ever, directorship requires courage in the face of change.”

Shifting Global Challenges

Citing a recent survey by WomenCorporateDirectors on the issues directors are most concerned about, Winter noted that global economic security is seen as the biggest risk. “Stakeholders don’t feel organizations are managing risk effectively.”

She added, “Some would add, and we would agree, that there is a correlation of higher financial performance with better risk management.” Winter also noted that companies that have put more resources toward risk management have tended to recover from the financial crisis better than others.

The opening panel of the Institute attempted to identify potential risks and challenges that companies face during a time of rapid globalization. The panel’s moderator Maria Livanos Cattaui, former Secretary-General of the International Chamber of Commerce introduced the panelists: Holly House, Litigator, Paul Hastings; Olufunke Osibodu, Group Managing Director and Chief Executive, Union Bank of Nigeria; Gina Raimondo, Rhode Island General Treasurer; Susan Schwab, Director, Caterpillar, Boeing, and FedEx and former US Trade Representative; and Mercedes Aráoz Fernández, Representative in Mexico, InterAmerican Development Bank, Director, QuiCorp, and former Minister and Presidential Candidate, Peru.

The women discussed challenges arising from new regulations, fewer multilateral trade agreements, fewer resources, disruptive technology, and the interplay of politics and fiscal realities. By engaging in constructive dialogue, directors are better positioned to advise their companies on the future of business.