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Some Reflections on the Diversity of Corporate Boards: Women, People of Color, and the Unique Issues Associated with Women of Color
Abstract
As one might expect, there are many similarities between the circumstances of women directors and directors of color, which includes African Americans, Latinos, and Asian Americans. Indeed, both groups began appearing on corporate boards in significant numbers during the same period—right after the Civil Rights Movement pursuant to which the push for racial equality throughout society precipitated efforts to achieve greater representation of people of color as well as women on corporate boards. Moreover, while women and people of color have experienced some increase in board representation over the last few decades, both groups also have encountered significant barriers to their success on corporate boards. However, people of color appear to have experienced more significant barriers than women, while women of color appear to be experiencing the most formidable of such barriers.Without question, corporations have achieved better representation of women and people of color within their boardrooms in recent history. Further, if the historical patterns related to these groups’ increase continue, we may expect that virtually every major corporation will have at least one woman or person of color on their board within the next two decades. However, women and people of color continue to be under represented, suggesting that they face barriers preventing them from translating their thirty percent and near fifty percent status in the labor force into similar numbers at the corporate board level. Part of those barriers stems from the difficulties women and people of color experience with advancing into executive positions at major corporations. Because corporations rely heavily on people who have held such positions, these difficulties have a negative impact on efforts to increase diversity on corporate boards. Of particular concern may be the plight of women of color. Indeed, studies suggest that women of color have achieved the least amount of success with regard to board representation, and that women of color experience the most significant barriers with regard to achieving success within corporate America. This is particularly daunting considering the disproportionate number of African American women in the workforce and student population as compared to African American men, which will make achieving more representative percentages of racial and ethnic diversity on the board significantly more difficult.
... The responsibilities of the Board are to establish the vision, mission, and values; set strategy and structure; delegate to management; exercise accountability to shareholders; and be responsible to relevant stakeholders. (Bernardi, Bosco, & Vassill, 2006;Fairfax, 2005;Hinkin & Tracey, 2010;Johnson, Schnatterly, & Hill, 2013) Boards of directors provide the broad framework for organizational policies and conditions from which an organization operates and functions (Claringbould & Knoppers, 2007). Establishing the vision, mission and values is often considered to be the same. ...
Corporate boards of directors provide a framework for successfully managing an organization. Memberships on corporate boards of directors are predominated by men. Worldwide, women face significant challenges in gaining access to the boardroom and leadership of prestigious committees on the board. While a significant amount of research has been carried out on the traits of senior managers, little has been done on the board of directors. The main question to be considered in our research pertains to the characteristics of women and men on corporate boards (WOCBs and MOCBs). These characteristics will be discussed along with implications and recommendations for increasing the representation of women on boards. Journal Name: Journal of the North American Management Society
... Second, it is important to be more inclusive in the study of WCBD, particularly the experience, characteristics, representation, effectiveness and contributions of women of color and international women. By widening the study of WCBD to include all women, not just white women, future research can provide information and insights not yet available about equity and inclusion on corporate boards (cf., Fairfax, 2005 ). Future studies should also pay more nuanced attention to other differences among women in addition to their differences from men directors, such as, for example, age and career-stage differences among women. ...
... American corporations also are making some progress toward the inclusion of more women and minorities on corporate boards. For example, in 2004, 82% of Fortune 1000 companies has at least one woman on the board and 76% of Fortune 1000 companies had at least one member of an ethnic minority on their board where the composition is 47% African Americans, 18% Latinos, and 11% Asian Americans (Fairfax, 2005). Catalyst Inc. (2011) indicates that women held 15.6% of the board seats of the Fortune 500 companies in 2010, an increase from 13.6% in 2003 and 11.7% in 2000. ...
Abstract
Purpose - The purpose of this study is to examine the relationship between audit committee diversity and earnings management in Malaysia after the revision of Malaysian Code of Corporate Governance (MCCG) in 2007.
Design/methodology/approach – The sample for this study was drawn from 280 companies listed on Bursa Malaysia in 2005, 2006, 2008 and 2009. Multivariate regression analysis was used to address the research hypotheses. The discretionary accrual was estimated using the Modified Jones Model which was used to proxy for earnings management.
Findings - The study found negative correlation between the compositions of Malay audit committee members with earnings management. In contrast, female directors show no effect in mitigating earnings management which may be due to the small size of female members in the audit committee.
Research limitations/implication – This study provides to the researchers new empirical results on the effectiveness of audit committee diversity in mitigating earnings management after the amendments of MCCG.
Originality/value - This study is important because it is among the pioneer empirical evidences to compare the effectiveness of audit committee diversity in mitigating earnings management between the pre and post revised MCCG periods. The audit committee diversity refers to ethnic diversity and gender diversity.
... Second, it is important to be more inclusive in the study of WCBD, particularly the experience, characteristics, representation, effectiveness and contributions of women of color and international women. By widening the study of WCBD to include all women, not just white women, future research can provide information and insights not yet available about equity and inclusion on corporate boards (cf., Fairfax, 2005). Future studies should also pay more nuanced attention to other differences among women in addition to their differences from men directors, such as, for example, age and career-stage differences among women. ...
After the first two chapters I was so absorbed I was almost reluctant to go to coffee and, as other coffee addicts will know, it is a rare book, especially a rare academic book - that can make one careless in observing the customary coffee break... I found that the way this book is written helped me to reflect on much of the gender research that I am involved in currently because the questions raised are so searching and far-reaching. Once again, the chapter authors combine brevity with thoroughness and depth in their examination of the themes, which made this a very rewarding book because it takes you so far in your thinking in just 240 pages... I feel energised by the debates that the book has opened up for me. I have done research in this particular area, but I now feel that I have explored different perspectives and new depths and I am grateful to the editors for that. - Marianne Tremaine, Gender in Management: An International Journal. © Susan Vinnicombe, Val Singh, Ronald J. Burke, Diana Bilimoria and Morten Huse 2008. All rights reserved.
Purpose: The objectives of this study are (i) to assess the significance as well as implications of the major readily detectable (age, nationality, gender and tenure) and underlying aspects (legal, human resources, accounting and finance and industry-specific competencies) of diversity on the corporate governance (CG) of Maltese Equity-Listed Companies, and (ii) to ultimately recommend how such aspects may make a more positive contribution. Design/Methodology/Approach: Semi-structured interviews were conducted with twenty-three participants, eight directors, ten company secretaries, one chief executive officer, one corporate lawyer, one Institute of Directors representative and two corporate advisors. Findings: The indications are that, in Malta, tenure diversity is the most influential readily detectable aspect, whilst industry-specific competency is the most influential underlying aspect of diversity for CG. The eight aspects of diversity are generally considered most influential advantageously on Board decision-making and problem-solving and least influential advantageously on director complacency, acceptance and communication. It is also generally agreed that a diversity index would be beneficial. Practical Implications: Overall, diversity is beneficial to the mechanisms of the board, yet there is no one standard diversity mix. Each aspect of diversity varies its impact on CG. Originality/Value: Studies in the field of CG emanating from small island states such as Malta are limited. This study provides value to listed companies and the competent authorities by bringing to light the significance and influence on CG of the various diversity aspects under study.
La ricerca analizza la relazione tra board diversity (intesa come diversità di genere e di nazionalità) e alcuni profili delle performance operative del consiglio rilevanti ai fini dell'efficace esercizio della funzione di monitoring. L'indagine è svolta su un campione di 237 società italiane quotate nel periodo 2007-2009. I risultati ottenuti mostrano una relazione positiva tra attività di monitoring e presenza delle donne nel consiglio di amministrazione e una relazione inversa tra numero di riunioni del board e presenza dei consiglieri stranieri. In merito al comitato per il controllo interno, i risultati mettono in luce una relazione diretta tra numero di riunioni del comitato e numero di consiglieri di genere femminile, mentre non è significativa la relazione tra numero di consiglieri stranieri e sedute del comitato audit. E' stato anche indagato il legame tra board diversity e costo dell'equity: i risultati evidenziano una legame non significativo a livello statistico sia in relazione al numero di donne che di stranieri nei board. Filone di ricerca: Offerta di servizi finanziari per la nascita e lo sviluppo di imprese innovative Sebbene questo paper sia frutto di un lavoro di collaborazione tra gli autori, la responsabilità per la stesura delle diverse parti può essere così suddivisa: Paola Schwizer è autrice dei paragrafi 1 e 5, Maria-Gaia Soana è autrice dei paragrafi 3 e 4, mentre Doriana Cucinelli è autrice del paragrafo 2.
Why do so many African Americans get stuck near the bottom or at the middle of the corporate ladder? Why do so many continue to complain about discriminatory pay and promotion decisions many decades after the enactment of anti-discrimination laws? Law and economics commentators who have written about the issue of employment discrimination have failed to address the complexity of the problem of implicit bias and the effects of the frequently inaccurate heuristics used by some white workers when making judgments about their black colleagues. Economic theory without context is useless. But with context, law and economic analysis can help us understand and address specific problems like workplace discrimination that persist within corporate cultures because of an overestimation of the cost of anti-discrimination efforts and an underestimation of the gravity and likelihood of workplace discrimination.
In this chapter, I explore the economic and socioeconomic reality of African American low and mid-level corporate managers in order to capture a more complete picture of the costs of discrimination in the corporate workplace. I also explore the heuristic assumptions that are made about African American professionals and the effects those assumptions have on the black community. Finally, to understand the gravity of the harm to individuals, their families and the communities to which they belong, narratives about the economic and psychological harm caused by discrimination are essential. I offer the narratives of six middle managers and low-level professionals who faced discrimination in the corporate workplace to provide an important context about discrimination's real costs.
This dissertation abstract and the reflection commentary present the work of Dr. Johanne Grosvold. The dissertation addresses the influence of institutional context on the prevalence of women on corporate boards of directors. The dissertation abstract explains the research questions, setting, and methods.The reflection commentary discusses the author’s views of research process as a junior scholar.
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