The underrepresentation of women on boards and senior management roles has long been a concern for Canadian boards of directors. In our many previous articles, we revealed that the presence of women in boardrooms can be good for business and may have an impact on directors’ overall skills and performance.
Over the past few years, recruitment processes have been implemented in order to redress this imbalance. Many reports now indicate that the number of women on boards has increased in the 300 largest listed companies in Canada compared to several years ago.
Enforcing Policies to Diversify Canadian Boards’ Composition
Change has occurred over time, albeit slowly. Over the past few years, the percentage of women in the boardroom among Canada’s public companies has increased, reaching 15% in 2015. This result reflects the current desire to shape best practices for recruitment and renewal in Canadian boards to come.
According to the article written by Barbara Shecter and published in the Financial Post, “the Ontario government has committed to reviewing appointments to provincial agencies, commissions, and Crown Corporations with a goal of having women make up at least 40 per cent of their boards by the end of 2019.” Moreover, nearly 50% of listed companies in Canada have implemented a diversity policy within their organization.
A Female CEO May Be a Solution to Board Diversity
It is unlikely that a woman leading a company will be the lone female representative in the boardroom. Indeed, it has been shown that in over half of companies led by a female CEO there are almost 3 additional women on boards.
According to Malli Gero, co-founder and president of 2020 Women on Boards, “Women-led companies are doing better in the gender diversity on boards than male-led companies, but in general we’re also seeing a better level of women serving on boards”.
The presence of women in the boardroom can also benefit corporate governance. According to the executive summary written by Vicki W. Kramer, Alison M. Konrad, and Sumru Erkut in 2006 Critical Mass on Corporate Boards: Why Three or More Women Enhance Governance, corporate governance could be enhanced in at least three ways if companies were to have a critical mass of female directors:
- Discussions within the board of directors would include “perspectives of the multiple stakeholders who affect and are affected by company performance, not only shareholders but also employees, customers, suppliers and the community at large”.
- Decision-making process would be enhanced thanks to the fact that difficult issues are not ignored or put aside.
- Management would be improved thanks to the fact that the dynamic of the boardroom is “more open and collaborative”.
« A female CEO may be the answer to more women on boards, surveys show » – Jeff Green, Bloomberg News – Published in the Financial Post
A Board Portal for Reinforcing Performance of Board Members and Efficiency of Board Meetings
Our thorough observations of boards in the past have shown that there are many digital tools at the disposal of board members. These tools help boost meeting efficiency, enhance communication and collaboration, and improve the decision making process. An example would be board portal software which allows directors a secure access to their board meetings from anywhere and at any time, even when offline.
The DiliTrust Exec solution is a multiplatform board portal, available on iPad, Android and Surface Pro devices. It is a highly secure, yet user-friendly software that supports corporate governance of board directors and committees. Each board member is offered access to a personal dashboard, which includes many cutting-edge resources, for example, intuitive digital note taking (with sticky notes, handwriting and highlighting), that can be kept personal or shared with fellow members for increased collaboration.
In conclusion, the presence of women on boards of directors effectuates an overall positive and enhancing effect on the performance of the boardroom, fellow directors and the corporate governance best practices. In addition, female-led companies are more likely to introduce more women on boards or in senior management positions than male-led companies, often reaching the aforementioned ideal critical mass within their board of directors. Diversity policies, new recruitment and renewal processes are being implemented to close the existing gap yet the issue of finding qualified women to increase their representation in Canadian public companies still remains a significant concern.
“Ontario commits to having at least 40 per cent women make up provincial boards by 2019” – Barbara Shecter – Financial Post
“A female CEO may be the answer to more women on boards, surveys show” – Jeff Green, Bloomberg News – Financial Post
“Gender Diversity on Boards and in Senior Management” – By Andrew MacDougall and Michele Qu – OSLER
“Critical Mass on Corporate Boards: Why Three or More Women Enhance Governance” – Kramer, V.W., Konrad, A.M., Erkut, S. – CBDC / Resources