Diverse boards lead to success

The number one issue faced by the Black woman leader in the boardroom is often the fact that she is the only one – and the darker her skin, the more evidently alone she is. This is the elephant in the boardroom.

There has been progress regarding the appointment and integration of women: more than 33% of board positions in the FTSE 100 are now occupied by women. However, less than 3% would be described as Black. And the fact that only 1.5% of senior positions held in UK businesses today are held by Black people makes their position starker still.

The challenge becomes even more evident when you consider that at the 261 companies below the FTSE 350, only 48% have met the target of 33% of women on their boards, more than 50% of them have all-male executive leadership teams and only 3% of them have board directors of colour. The further down the FTSE you go, the less encouraging it looks.

You may argue that the talent is not available and that boards should work with their organisations and search firms to identify and develop people specifically for board roles. But it is not so simple.

Organisations such as Women on Boards and the Financial Times have board-ready talent development programmes aimed specifically at women – I took part in a Financial Times Non-Executive Director Training workshop a few years ago. The learning I have gained since then through the variety of boards I have had the opportunity to sit on – profit and non-profit – has made me a strong candidate for additional board roles. My experience, however, has been to the contrary.

As a Black woman who is board ready and experienced, the number of opportunities that come my way for roles in the FTSE are few to non-existent. And yet White women in my network have four or five non-executive board roles in their portfolio and are constantly being approached for more. When I speak to search firm partners who place non-executives on boards, I am constantly reassured that I would be ‘easily placeable’ and that now, also having become a chair of the remuneration committee of a listed company, the likelihood is much higher. Only time will tell.

Assuming you can secure that seat at the boardroom table, you may find the subtleties of discrimination and what is termed ‘microaggression’ can still prevail. To be fully integrated and made to feel like you belong, you need a board chair who is overtly inclusive and a great listener. They need to be a real believer in the genuine value and contribution of a diverse board to the success of a company. They must be willing to be uncomfortable and appreciate that through discomfort comes growth.

I say this because discomfort comes from the unfamiliar. If you have never had a diverse network of friends or even needed one, it takes some courage to proactively work towards attracting, selecting and enrolling a diverse group of non-executive and executive board directors.

Diverse boards are integral to the achievement of diverse companies and organisations. If the very top does not mirror what is expected in the body of an organisation, it is difficult to prove you walk your talk. It is also likely that opportunities for growth, creativity and innovation in the development and execution of strategy will be lost.

Change will be challenging and indeed slow because we are dealing with human beings and the complexity that comes with being human. But if there is a genuine intention, backed up by action, to welcome difference to your boards and into the most senior levels of organisations, it will happen. Then the benefits will be reaped by us all – board, company, stakeholders, community and, indeed, society.

Here, we have listed a selection of issues that may be faced by the Black woman on a board, and practical ideas on how they may be resolved. They may also apply to other underrepresented groups in the world of company boards and senior leadership.

The challenge sometimes faced by board chairs and their peers is finding where the senior women and Black women are. This is not helped by the headhunter who is also renowned for only going to trusted sources for referrals – they exacerbate the issue by repeatedly approaching candidates they have successfully placed in the past for additional roles. This results in one woman, usually White, with several board roles and the other, usually Black, with one or none.

To address this, the board chair must first diversify their own personal network, being proactive in developing relationships with organisations that have a purpose in ensuring the visibility and development of women and Black women for senior roles and board positions. They must also be explicit in specifying a minimum percentage of women and Black women they expect to see on headhunters’ shortlists.

This means stepping out of the norm and engaging with search firms that are women- and/or Black women-owned. The listed board I sit on – which I feel embraced me and where I feel able to fully contribute as well as learn – is one whose recruitment process was handled by a woman-owned-and-led firm.

It is important to ensure that all members of the board to which you want to recruit a woman and a Black woman are aligned on the value of diversity. This should not be a tick-box exercise or one in compliance because of assumed pressures from investment houses, stakeholders, the FCA and FRC. A lack of consensus will run the risk of the candidate – especially if they are a first-time hire – being ejected.

I once joined a board on which some colleagues were warm and welcoming and some ignored me completely; others ignored my contributions, only to repeat them later in the same meeting. Therefore, a well-intentioned chair who does not ensure all the board members are aligned may well make things worse for both parties. A discussion beforehand can enable the teasing out of issues, resulting in cohesion and the vicarious benefit of a stronger team atmosphere. This will bode well for any new addition to the board, regardless of who they are.

Raising the value of difference early on can start with a discussion of skill gaps, but it should broaden to explore how the inclusion of people who are different can help the board to be more effective in their decision-making and consequential and/or contextual in their thinking.

What are your selection criteria? Of course it is important that a candidate has sector experience, an understanding of the product or service, the nature of the customer, client and consumer, including the various potential routes to market, and so on. But there are some criteria that may on the surface seem critical, but are actually not. Criteria such as ‘must have been a CEO’, ‘will be the Chief People/Finance Officer or Group HRD/FD’ of a FTSE 100 company will immediately shrink the talent pool. When we read that the C-suite of these companies lack ample representation of race and gender, it narrows things even more.

It is important to challenge the ready assumptions of what is required to be a credible board member, explore the value of transferable skills, look beneath the C-suite and request that your search partners do the same. Look for compensating and complementing skills and capabilities, and explore what additional short-term training can be put in place. Also, explore the opportunity to have a board apprentice, which can provide a safe and mutually beneficial way of introducing more women, Black women and diversity into your board.

Inviting the Black woman on to your board to contribute only to topics of diversity and social mobility, when she is capable of much more, is an illustration of unconscious bias and unintended racism. Too often, the Black woman finds that her board-level contribution is ignored or overlooked. It is challenging enough for any new member of a board to integrate fully and quickly; it is even more challenging when they are in the minority.

The chair must ensure that the board is welcoming and inclusive by playing a key role in the onboarding process. Facilitate one-to-one relationships between the executive and non-executive board members outside the formality of board meetings, arrange visits to company sites and facilities, and invite contribution from the new members.

It is also OK to be open with the fact that this is the first or second time someone different is being hired at this level and discuss what would maximise the effectiveness of their contribution. A conversation like this, with genuine intention, removes unnecessary assumptions, allows concerns to be aired and paves the way for a strong, trusting relationship that is essential for any board.

A member of my network joined and then left a board within two years, and a year before her first term of service was due to end. Her decision to join was based on her understanding of the values of the organisation, the style and leadership of the chair who recruited her, as well as a product, service and end user she had knowledge and experience of. Once she joined the board, the chair announced his departure. While this in itself is not unusual, the biggest influence on that board was the chair. When he had gone, she did not feel welcomed by his successor and felt excluded by the other board members. Side conversations on topics familiar to them and not to her happened without much effort to include her.

To resolve this issue, it is important to anticipate any changes in the short and long term, and the implications and impact not only on the company, but also on the board dynamics. Some reports suggest that having more than one woman on a board enables retention and a more impactful benefit of diverse thinking and experiences. To enable the retention of the woman – and the Black woman – regardless of changes that may or may not be foreseen, ensure that 30% or more of your board and leaders are women, including the Black woman. Have ample one-to-one quality time with her and encourage the building of strong relationships between all board members – formally and informally. Consider board awaydays and team-building days.

The ICAEW Library & Information Service provides full text access to leading business, finance and management journals and key business and reference eBooks. Further reading on diversity in the boardroom and senior leadership positions is available through the resources below.