Canadian corporate directors agree board diversity is an important and worthwhile initiative that can contribute to better decision-making and governance, according to a study by the Institute of Corporate Directors (ICD).
Diversity in the Boardroom: Findings and Recommendations of the Institute of Corporate Directors is based on a series of town hall discussions in Vancouver, Calgary, Edmonton, Saskatoon, Winnipeg, Toronto, Ottawa and Halifax, and a survey of 550 ICD members.
Of those surveyed, 90 per cent agreed board diversity is a governance issue of importance and nearly 80 per cent believe board diversity contributes to better decision-making.
But most of the town hall and survey participants were strongly opposed to government-imposed quotas or legislated mandates — only four per cent were in favour of such measures.
"Greater board diversity can contribute to better governance," said Stan Magidson, president and CEO of the ICD. "The key is for boards to make diversity a priority and approach it within the context of their particular skills matrix and board composition.”
The ICD urged Canadian boards to consider its six recommendations:
•Consider diversity as an important part of the criteria used to determine board composition. Diversity for these purposes should be broadly defined to include gender, ethnicity, age, business experience, functional expertise, personal skills, stakeholder perspectives and geographic background.
•Adopt formal diversity policies that outline the essential criteria and experiential attributes that fulfill the needs of the board.
•Direct search firms, where used, to include diverse candidates in searches whenever possible (and subject to satisfying the qualifications of the position).
•Encourage search firms to include qualified candidates who are unknown to current board members
•Facilitate diversity agendas that permeate all levels of an organization, starting at the top with the board, CEO and senior management ranks.
•Consider limits on the tenure of board members to encourage ongoing board renewal, being mindful of the need for a healthy degree of board continuity and experience.
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