I interviewed Katherine Garrett Cox of the Alliance Trust last week. You can find a full interview with her in this week’s MoneyWeek magazine, out on Friday. If you’re not already a subscriber, subscribe to MoneyWeek magazine.
Given that she is both a woman and CEO of a huge listed company, it was inevitable that we would end up talking about the lack of female directors in the UK. At the moment, a mere 12.5% of FTSE 100 company directors are women. And if you knock out the non-execs, that comes down to more like 5.5%.
The reasons for all this are much debated, but the general conclusion is that thanks to the breaks they take for their children and an apparent preference for lifestyle over career, there just aren’t enough women in the pipeline to make the numbers much higher.
So should there be more women on boards? I suspect there should be. Katherine isn’t so sure. She has a pretty good pipeline of women in her own company: at graduate level she reckons Alliance have a reasonably good 50/50 gender split and even at the top she still thinks around 30-35% of managers are women. But that doesn’t mean she thinks that having women around is in itself vital.
Instead she sees it as being “all about balance” and how people think. “Some women can think like men and some men can think like men.” So getting a good board isn’t about gender, it’s about having a group of people who think independently of each other – about avoiding ‘groupthink’.
Given that, forcing people to hire more women for the sake of it by putting in place quotas makes no sense at all. Katherine also gives me an excellent article from the Harvard Business Review that sums up all the anti-quota arguments pretty well. I’m almost convinced.
But later I wonder. If one whole group of people isn’t getting themselves on to boards, it is tricky to get together the diversity you need to stop groupthink. So maybe you do really need women – not because they are women, but because they represent 50% of the population.
Then I wondered if the lack of a pipeline is really about women failing to put in the work to get board ready because they don’t want to, or if it is actually about them failing to put in the work to get board ready because they can’t see the point. 73% of women questioned for a recent Institute of Leadership and Management survey agreed that the glass ceiling still exists. Only 38% of men did.
Add the perceived glass ceiling to the ongoing idea that the executive world really is an old boys’ club (one in which men of a certain age trying to think of people to ask on to their board can only think of other men) and it might be the case that women don’t get to the top because they don’t try. But it might also be the case that they don’t try because they think it isn’t trying that brings success – it’s being a 55-year old man.
If so, and if we want women to be on boards, we need to make it clear that if they make the effort to fulfil the requirements they’ll get their just rewards. Targets won’t do for this – targets never do anything (ask a politician). So we have to have quotas – quotas that we enforce. That way, competent women who get to the top and get themselves board ready will know they will eventually end up on a board.