Proportion of seats held by women grew by 3 percentage points from 2001 to 2007
Linda Hasenfratz is a mother of four children under the age of 12, the CEO of Guelph, Ont.-based auto parts manufacturer Linamar, and part of a small group of Canadian women who occupy just 13 per cent of seats on the boards of Financial Post 500 companies.
Despite the fact there are so few women board directors, Hasenfratz never saw her gender as a barrier to her attaining a seat on the CIBC board or making a significant contribution over the past four years.
“I think it’s only a challenge if you let it be a challenge. If you have the knowledge and experience to contribute, that knowledge and experience are valued,” she said. “In many situations in my regular job, I’m the only woman in the room but I don’t think it’s an issue. It’s not an issue because I don’t let it be an issue.”
However, the progress of women to the role of board director has been disappointingly slow, said Deborah Gillis, Catalyst vice-president for North America.
Catalyst, a New York-based research and advisory organization that promotes women in business, conducts a census of women board directors in FP500 companies every two years. Since Catalyst started tracking the proportion of FP500 board seats held by women, the proportion has increased only 3.2 percentage points, from 9.8 per cent in 2001 to 13 per cent in 2007. That’s an average growth of about 0.5 percentage points per year.
“Despite the signs of progress we see, despite the contributions that women have made in so many fields of endeavour, women continue to be significantly underrepresented in Canadian boardrooms,” said Gillis. “We must do more than simply rely on the best to do better. Instead, we must engage more companies and more industries in making a change.”
The 2007 census also found 43.2 per cent of FP500 companies still have no women on their boards while only 28.6 per cent had more than one woman on their boards. The census also found women make up just 3.4 per cent of board chairs, an increase of 1.3 percentage points since 2005, and only 6.8 per cent of committee chairs.
“Even when women earn their place at the boardroom table, leadership positions as chairs of boards and committees remain largely out of reach,” said Gillis.
However, the situation is slowly improving as the proportion of boards with multiple women has increased 6.6 percentage points since 2001, while the proportion of boards without any women has dropped 3.5 percentage points in that same time.
Research shows executive men and women have the same aspirations to reach the top, so it’s a myth to say women don’t aspire to these higher positions and that’s why they don’t have equal representation, said Gillis.
It’s also a myth mothers don’t have the time to devote to a board position, said Hasenfratz. Women just need to establish firm guidelines around when they’ll work and when they’ll spend time with their families, and draw in the help they need to make it work.
However, one of the barriers to women getting a spot on a board is that boards are drawing from a narrow pool of talent, said Gillis. The census found 20.2 per cent of vacant seats were filled by individuals already sitting on a board.
As part of the report, Catalyst interviewed 56 women board directors. The consensus among them was that women are still excluded from strategic business and community networks, otherwise known as the “old boys’ clubs,” which are often the source for new board members.
Companies also look to draw board members from their own industries and often only consider CEOs, chairs, vice-chairs and presidents, of which very few are women, said Gillis.
According to Catalyst’s 2006 Census of Women Corporate Officers and Top Earners of the FP500, women held only 39 (7.3 per cent) of these top positions.
By including all corporate officers in their search, companies would deepen the field of expertise on their boards and “capture the women who are successfully and strategically running large business units,” said Gillis.
HR is one business unit that could yield a wealth of expertise for corporate boards. Not only are there significantly more women in HR, but the specific types of expertise they bring (recruitment, retention and compensation) are particularly valuable to companies facing increased pressure to fill positions and provide compensation oversight, said Hasenfratz.
Increasing gender diversity on corporate boards isn’t about doing the right thing, it’s about doing what’s right for the business, said Gillis. The 2007 Catalyst report The Bottom Line: Corporate Performance and Women’s Representation on Boards found companies with the most gender diverse boards had a 53-per-cent higher return on equity compared to companies with the least gender diverse boards.
“Diverse boards can better understand customers and their markets,” said David Forster, managing partner in the greater Toronto area for PricewaterhouseCoopers.
And the looming talent shortage and baby boomer retirements mean companies have to draw from all sources of talent if they want to fill vacant board seats, said Nora Aufreiter senior director and location manager at McKinsey and Company Canada.
“There’s a hugely talented pool sitting out there. Companies just need to take advantage of what women have to offer,” she said.
Top tips
How to get more women on corporate boards
Tips for decision makers:
• increase the number of women CEOs;
• look among all corporate officers for candidates;
• require diverse candidates;
• update skill matrices to determine what skill sets are lacking; and
• look to other industries where those skills might be available.
Tips for women:
• expand your networks;
• get experience on non-profit and community boards;
• seek out mentoring opportunities with women and men;
• let other professionals and recruitment firms know you’re interested;
• get support from your CEO;
• research the board you want to be on and network with members; and
• build your reputation as an expert.
Despite the fact there are so few women board directors, Hasenfratz never saw her gender as a barrier to her attaining a seat on the CIBC board or making a significant contribution over the past four years.
“I think it’s only a challenge if you let it be a challenge. If you have the knowledge and experience to contribute, that knowledge and experience are valued,” she said. “In many situations in my regular job, I’m the only woman in the room but I don’t think it’s an issue. It’s not an issue because I don’t let it be an issue.”
However, the progress of women to the role of board director has been disappointingly slow, said Deborah Gillis, Catalyst vice-president for North America.
Catalyst, a New York-based research and advisory organization that promotes women in business, conducts a census of women board directors in FP500 companies every two years. Since Catalyst started tracking the proportion of FP500 board seats held by women, the proportion has increased only 3.2 percentage points, from 9.8 per cent in 2001 to 13 per cent in 2007. That’s an average growth of about 0.5 percentage points per year.
“Despite the signs of progress we see, despite the contributions that women have made in so many fields of endeavour, women continue to be significantly underrepresented in Canadian boardrooms,” said Gillis. “We must do more than simply rely on the best to do better. Instead, we must engage more companies and more industries in making a change.”
The 2007 census also found 43.2 per cent of FP500 companies still have no women on their boards while only 28.6 per cent had more than one woman on their boards. The census also found women make up just 3.4 per cent of board chairs, an increase of 1.3 percentage points since 2005, and only 6.8 per cent of committee chairs.
“Even when women earn their place at the boardroom table, leadership positions as chairs of boards and committees remain largely out of reach,” said Gillis.
However, the situation is slowly improving as the proportion of boards with multiple women has increased 6.6 percentage points since 2001, while the proportion of boards without any women has dropped 3.5 percentage points in that same time.
Research shows executive men and women have the same aspirations to reach the top, so it’s a myth to say women don’t aspire to these higher positions and that’s why they don’t have equal representation, said Gillis.
It’s also a myth mothers don’t have the time to devote to a board position, said Hasenfratz. Women just need to establish firm guidelines around when they’ll work and when they’ll spend time with their families, and draw in the help they need to make it work.
However, one of the barriers to women getting a spot on a board is that boards are drawing from a narrow pool of talent, said Gillis. The census found 20.2 per cent of vacant seats were filled by individuals already sitting on a board.
As part of the report, Catalyst interviewed 56 women board directors. The consensus among them was that women are still excluded from strategic business and community networks, otherwise known as the “old boys’ clubs,” which are often the source for new board members.
Companies also look to draw board members from their own industries and often only consider CEOs, chairs, vice-chairs and presidents, of which very few are women, said Gillis.
According to Catalyst’s 2006 Census of Women Corporate Officers and Top Earners of the FP500, women held only 39 (7.3 per cent) of these top positions.
By including all corporate officers in their search, companies would deepen the field of expertise on their boards and “capture the women who are successfully and strategically running large business units,” said Gillis.
HR is one business unit that could yield a wealth of expertise for corporate boards. Not only are there significantly more women in HR, but the specific types of expertise they bring (recruitment, retention and compensation) are particularly valuable to companies facing increased pressure to fill positions and provide compensation oversight, said Hasenfratz.
Increasing gender diversity on corporate boards isn’t about doing the right thing, it’s about doing what’s right for the business, said Gillis. The 2007 Catalyst report The Bottom Line: Corporate Performance and Women’s Representation on Boards found companies with the most gender diverse boards had a 53-per-cent higher return on equity compared to companies with the least gender diverse boards.
“Diverse boards can better understand customers and their markets,” said David Forster, managing partner in the greater Toronto area for PricewaterhouseCoopers.
And the looming talent shortage and baby boomer retirements mean companies have to draw from all sources of talent if they want to fill vacant board seats, said Nora Aufreiter senior director and location manager at McKinsey and Company Canada.
“There’s a hugely talented pool sitting out there. Companies just need to take advantage of what women have to offer,” she said.
Top tips
How to get more women on corporate boards
Tips for decision makers:
• increase the number of women CEOs;
• look among all corporate officers for candidates;
• require diverse candidates;
• update skill matrices to determine what skill sets are lacking; and
• look to other industries where those skills might be available.
Tips for women:
• expand your networks;
• get experience on non-profit and community boards;
• seek out mentoring opportunities with women and men;
• let other professionals and recruitment firms know you’re interested;
• get support from your CEO;
• research the board you want to be on and network with members; and
• build your reputation as an expert.
