Contributed by Marilyn Nagel, CEO of ION Member Organization Watermark.
The original blog post appeared at: http://www.wearewatermark.org/2011/09/women-on-boards-still-lonely-at-the-top/

A recent article in The Economist explores the ongoing issue of the lack of women on boards in the U.S. and worldwide and the measures taken to combat it. Diversity and inclusion professionals (and women everywhere) have long been banging their heads against this same wall; the numbers have remained at a virtual standstill for a shocking amount of time.

The article, Women In Business: Still Lonely at the Top, specifically addresses the tactic of implementing quotas to boost numbers. The prime example is that of Norwegian boards, which were 9% female in 2003 and were ordered to become 40% female within five years. Other European countries have followed suit, prompting some American audiences to wonder if this might also be the solution.

While it’s true that the enforcement of quotas has made a drastic difference, we’re only now beginning to understand the implications of such rapid change:

“To obey the law, Norwegian firms promoted many women who were less experienced than the directors they had before. A recent study found that firms that were forced to increase the share of women on their boards by more than ten percentage points saw one measure of corporate value (the ratio of market capitalization to the replacement value of assets, known as Tobin’s Q) fall by 18%.”

In light of this research my perspective is that quotas for women on boards is not the answer. As the article suggests, the answer is complex and requires change from boards of directors, corporate executives, and from women.

Widen your lens- and your options. The first step is for boards to examine the job descriptions they create and how they recruit board members. They should not compromise their standards as was done in Norway to comply with quotas, but should look at the requirements of sitting on a board. The common standard is experience as a CEO, or at minimum C-suite and P&L (profit and loss) experience.

The fact is that a very small percentage of women (or minorities for that matter) are in the C-suite or CEOs, and many women who are in the C-suite are in fields that are not P&L carrying. This eliminates most women without examining equivalent experience that might enhance the board.

We all understand that diversity is healthy particularly when it comes to innovation and ensuring there isn’t “group think.” We also know that the financial crisis was anticipated and raised by a woman, but as a lone voice, she was not listened to. The BODs of the failed financial institutions all met the qualifications that are still held as sacrosanct – this would suggest that maybe voices from another discipline, or perspective might be healthy.

Wouldn’t a woman with top-level executive experience be as qualified to see financial gaps even if they did not carry P&L experience? For example, a Chief Human Resources Officer doesn’t carry P&L, yet has to be closely partnered with the CFO to run a company, develop policy on salary, stock options, and benefits. When we rule out anyone without P&L, we are losing great talent, and many of them women.

Leaders of the future. Corporate executives need to look within their ranks and at their bench strength to see if they are leaders for today or are leaders of the future. Leaders of the future have a different skill set, and are inclusive of many of the characteristics traditionally attributed to women. Then corporate leadership teams need to sponsor – to use Sylvia Ann Hewitt’s model, and ensure that talented women are put in positions where they can have greater exposure.

Invest in yourself. Women need to find sponsors, evaluate their network to see if it will help them achieve their career goals, and take advantage of board development programs. Programs like the Watermark Institute Board Access Program™ can connect them with opportunities to serve on boards. Women need to invest in themselves the way they invest in those who are still climbing the corporate ladder.