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01/11/2012 | Time for women to get on board

ILO Staff

The need to have more women in the world’s still male-dominated boardrooms has gained widespread recognition but there is also strong disagreement on how to go about it.

 

Women make up about 50 per cent of the world’s population but only a fraction become company CEOs or board members. Yet, evidence shows that having women at the top helps boost company performance.

In major US companies, only about 15 per cent of board members are women. In Europe’s top firms, it is just 1 in 7. Research shows that having women on boards is not just the “right” thing but also the “bright” thing to do.

According to recent surveys, companies with women in top management positions have better returns on investments than those with all-male boardrooms. But even though the issue is gaining recognition, the way to achieve gender equality in the boardroom is up for discussion. And the debate is heating up.

An EU plan to introduce compulsory quotas to force companies to promote more women to their executive suites was put on hold in October 2012 because the European Union’s executive body failed to reach agreement on the proposal. France, Norway and Spain already have similar legislation.

ILO News asked some prominent women for their views on this issue:

Liselott Kilaas,
  • Managing Director, Aleris Norway and Denmark
  • Deputy Chairperson of the Board of Directors, Telenor ASA
  • Board member, Central Bank of Norway 

“One important reason why there are few women in boardrooms is that there are also fewer women than men in management executive positions. Historically, board members have been recruited from the pool of management executives. I think that it is important that the nomination committees as well as executive search companies start looking beyond the group of female management executives in order to identify qualified females."

"Progress towards achieving equality at the top varies a lot. Even in my own country, Norway, where stock-listed companies must have 40 % female representatives on the board, there are still few women holding top executive management positions. Most companies today compete globally and I believe it is important to have a broad diversification amongst executives as well as non-executives, and gender is one of many diversification factors. I am not sure if we ever will achieve full equality and personally I am not so sure whether that should be a goal in itself.”

Sharan Burrow,

  • General Secretary of the International Trade Union Confederation (ITUC)

“Women make up half of the world population, so in a perfect world they should actually have half of the power too!  Quotas are tools which can help change culture (...) But I think the biggest mistake would be to reduce the struggle for gender equality to quotas (…)

Achieving full equality requires changes in the mind-sets of people – both men and women. This means that governments must take pro-active actions to challenge the gender stereotypes anchored in every society. Although women’s participation in top positions is important, it is equally important to address the huge gender inequality in today’s labour markets."

"Women earn on average 20% less than men for work of equal value and they are overrepresented in low-paid, low-skill jobs. A majority of working women worldwide are in precarious and informal work and labour markets are still highly segregated. Achieving women’s rights at work is urgent!”

Marina Yannakoudakis,

  • British member of the European Parliament
  • Conservative spokesperson for Women’s Rights and Gender Equality

“We need more women on corporate boards as we also need to achieve a better gender balance at all management levels. We should encourage sustainable and meaningful change in the way women are represented at a senior level in companies but we should do so through voluntary targets rather than mandatory minimums. I do not believe that quotas are the answer. Quotas are bad for women and bad for business. Women don’t want to be patronised and companies don’t want more EU red tape strangling their businesses."

"In the UK 100 women were appointed to FTSE-100 and FTSE-250 boards last year and FTSE-100 boards currently have 15.2% female representation. I agree that there is still a long way to go but these women were selected because they were the best people for the job. Had they made it to the top by virtue of quotas it would have been nothing short of patronizing.”

Jayati Ghosh,

  • Economist
  • Executive Secretary of the International Development Economics Associates (IDEAs)
  • Laureate of the ILO Decent Work Research prize

“Gender balance in the boardroom is required because it generally achieves more stable and viable management practices. It is not enough to have just one or two women at the head or in prominent positions, since that does not change the overall management culture. It is only when there are sufficient numbers of women in management positions in the organization that the overall culture and management strategy actually show some differences."

"Quotas are not sufficient but they are probably a necessary part of the solution since otherwise, overt and covert resistance to bringing women into top positions tends to be extremely high. Quotas may lead to short term injustice but are necessary for the medium term transition to a future situation in which they may no longer be considered necessary because the presence of women in top positions is taken for granted.”

ILO - International Labour Office (Organismo Internacional)

 



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