Boards, being the mind and will of a company, really do perform better when they include the best people coming from a range of backgrounds and perspectives. The boardroom is where all strategic decisions are made, risk overseen and governance applied and it is vital that an effective, well governed and balanced board consists of a diverse blend of high quality individuals bringing a mix of experience, skills and backgrounds to the table.
Government and media coverage over the past few years give us a picture that women are currently under-represented in the UK boardroom. This is despite the fact that various studies have shown that companies with more women on their boards have better performance, in terms of operating results, return on sales and return on equity, to name but a few KPIs.
In the UK we have a voluntary approach to address this issue of gender under-representation on boards (Lord Davies of Abersoch Review, 2015). Some progress has been made in the past 5 years, but there is still much, much more to be done to encourage more gender diversity. This is not an equality discussion – it’s an economic one – balanced boards are better for business.
There is no question about it. Diverse balanced boards with good governance are important. No matter the size of company, whether you are leading a growing start-up company or a global empire, a small advisory board or a major charity. Governance matters – and it’s all about doing the right things, not simply about doing things right (that’s compliance). We all need to get better at governance. Good governance prevents issues cropping up later to bite you in the bottom when you least expect it…
And the good news is that women are really, really good at governance. Our advanced risk awareness and multitasking abilities, imbued with a healthy dose of common sense, makes us ideally suited to governance roles.
I encourage you to think carefully about governance and its role in your company: are your boards and advisory committees appropriately balanced? If not, question it – call the company out on it. Or if you are the boss of your own company, call yourself out on it!
And I also encourage you to be part of the solution to the problem of imbalanced boards in the UK. Think about taking on a board role. Start small, gain experience, learn from others, earn your stripes and work your way up in either a small charity or a start-up – they will be highly appreciative of your support, no matter your age or experience.
If you want to learn more about board governance, there are lots of resources and courses available – have a look at the Institute of Directors (IoD), FT Courses and Women on Boards for starters, and this one from Edinburgh Napier University – Leadership in Board Governance – a course I have helped to develop.
Here’s to you becoming a leader in board governance.