The Transformational Power of Leadership: It’s Time For More Female CEOs and Board Members

While diversity and inclusion has been a hot topic in recent years, the COVID-19 pandemic along with demonstrations against systemic inequality and racial injustice have brought these issues under renewed scrutiny. Notably, the pandemic disproportionately affects women and minorities in countless ways, with higher rates of job and wage loss, an increase in invisible labor, lack of access to benefits like food banks, higher contraction and death rates

There's still a long way to go when it comes to women and other under-represented groups at the top levels and in the boardrooms of organizations. Just this past January, the World Economic Forum released a report stating that, based on current projections, it is going to take over 257 years to reach a gender-equal in the workplace. Meanwhile, there continues to be an obvious lack of diversity in many workplaces, especially in leadership positions.

I recently had the pleasure of discussing the dearth of women, and especially women of colour, in the c-suite and boardrooms with the Global COO Shared Services and Banking Operations at Morgan Stanley, Sophie Chandauka, in a webinar during the United Nations General Assembly. Sophie highlighted the need for everyone to examine their people processes (e.g. performance evaluations or talent ranking) and how we define a successful leader. She pointed out that our current protocols emphasize monolithic and often masculine traits that have the effect of excluding or unfairly prejudicing positive outcomes for underrepresented colleagues, such as women and ethnic minorities and particularly in senior roles.

So why does this detrimental definition of a ‘successful leader’ persist? As Sophie put it, “we don't have the critical mass [of people and women of colour] in the decision making rooms to call it out, challenge existing practices and redefine and reimagine talent development and retention strategy.” It’s a significant and complex conundrum. How can women of whatever heritage drive structural change if they’re not even in the room in meaningful numbers? This only highlights the need for the captains of industry to join as allies and lead from the front.

Currently, women CEOs lead just 6.6% of companies in the latest Fortune 500 List. Unfortunately, this statistic is not much better when we look at the number of females leading any sort of business, serving on Executive Boards, or holding the title of Chairperson. Only five companies on the Fortune 500 list are helmed by black CEOs, two of whom are women. Clearly, the tides need to be shifted. In order for organizations to survive and tap into their transformational power, there needs to be more diverse female leadership.

First, how do we move the needs of companies to make room for more women and especially women of colour? The main ways are through policies and current company leadership. In terms of policy, countries have begun to mandate the diversification of company boards. In the United States, California recently passed a bill called SB 826, which requires publicly traded companies to have at least one female board director. Before this law came into place, 75 percent of companies lacked a female board member; today at least two-thirds of those companies have added a female board member. Furthermore, this type of mandate has extended to other states such as Massachusetts, New Jersey, Washington, which are working on their own legislation. A push from large companies is also vital in making the switch. In a call for more board diversity, Goldman Sachs and Blackrock have set guidelines on the companies they will do business with based on their board makeup. Companies also need to work to make board slots more available to women and other under-represented groups. For example, make board positions more inclusive of titles generally held by more women such as CMO and CHRO, spotlight women and minority leaders within companies, and make the expectations of board members abundantly clear. Finally, for women and minorities looking to join boards, networking is vital. Also be sure to demonstrate your expertise. Don't forget what you bring to the table and why you are the person to make a difference. 

In response to the World Economic Forum report, I began publishing content on social media using the #250to50 hashtag. This represents a question I’ve been asking myself, if we tackled gender inequality with the same urgency that we do the other societal ills, could we create an equal world in 25 years, not 250? I received a lot of positive feedback from others using #250to50, but a hashtag is not enough. Yes, it helps raise awareness, but action needs to follow.

Women and minority leaders have a range of expertise that make them excellent CEOs and board members. Often, they’ve had to work harder to achieve their positions. They are also motivated by a sense of purpose and often display traits of courage, risk-taking, resilience, agility, and managing ambiguity. It’s for all these reasons and more that we all need to come together to offer women and minorities a central place in the boardroom and beyond. I am the Global Chair of the 30% Club, a global campaign which seeks to increase gender diversity at boards and senior management levels. We have chapters throughout the world and run various initiatives to create real transformation. These initiatives range from encouraging and supporting Chairs and CEOs to appoint more women to boards and senior management teams to spotlighting these issues through the media. We also promote research in this area, work with other groups, stage events, provide information for businesses, and speak at schools. Ultimately, we want change to be realised through education and a voluntary approach – it should never be forced. When the 30% club was founded back in 2010, only 9.5% of FTSE 350 board positions on average were held by women, today that number is 33%. Still, over one-third of these companies are individually below the 30% target number. 

This summer, The 30% Club UK announced 3 new targets to reach by the end of 2023:

1. Beyond 30% representation of women on all FTSE 350 boards, and to include one person of colour by 2023
2. Beyond 30% representation of women on all FTSE 350 Executive Committees, and to include one person of colour by 2023 
3. Beyond 30% of all new FTSE 350 Chair appointments to go to women between now and 2023

When we started out 30% seemed like an aspirational goal for having more women on FTSE 350 boards, but today the sky’s the limit. If the last months have shown us anything, it’s that we still have a long way to go in diversifying companies across the world. It is no longer enough to donate to the cause, we must proactively institute policies that will make a difference. The 30% Club is willing to work with organisations in order to help facilitate meeting these goals, and these targets are the result of the work and focus from our recently established Diverse Women working group. Not only are these targets achievable but they are an imperative that we will restlessly pursue moving forward, and hopefully recent global developments will only accelerate things.

More recently, the 30% Club partnered with the Confederation of Business Industry (CBI) #ChangeTheRaceRatio campaign to increase racial & ethnic participation in senior leadership levels position at companies. Change the Race Ratio is calling on businesses to join and set and announce clear goals for incorporating greater racial and ethnic diversity in their c-suite, boardroom, and across leadership roles throughout their organization. So far, a number of large enterprises have joined in, and we’re excited for more to as well in the coming weeks and months.

To learn more about the 30% Club and our latest work and achievements visit us at https://30percentclub.org/ or find us on social media https://twitter.com/30percentclub. We will see change when we all work together.