Board Diversity: The Way Forward
August 2 2021
A number of Tech companies are increasingly appointing diverse board members, however, this practice needs to continue and spread among other companies. GeekWire, a major technology news site, investigated the composition of 30 board of directors of publicly traded tech and biotech companies in Washington. In its report, almost 27% of the 251 positions on the board were held by women. But racial and ethnic diversity lagged behind in many areas. Around 6% of the directors were black and only 1% were Hispanic or Latino. Asian directors performed better, occupying almost 9% of the seats where most of these board members were Indians (James; 2021). Thus, what can tech companies do to improve their boards are more divers?
Promoting better governance to create long-term shareholder value is one of the main goals for a number of organizations. These organizations are actively recruiting women and candidates from diverse racial and ethnic backgrounds to serve on corporate boards. However, many focuses on their existing networks. Therefore, it is recommended organizations look beyond their existing networks and create new opportunities for women, people of color, young leaders, and other typically underrepresented groups. Consequently, enterprises are encouraged to reach out beyond their network.
Furthermore, organizations need to recruit directors with a depth and breadth of technical knowledge, including digital, social media, e-commerce, technology infrastructure, and cybersecurity. Although, the specific expertise by organizations varies, one thing is certain, knowledge in technology is essential, and will be a baseline requirement for the next generation of board members. Tech behemoths like Google and Intel have pronounced that they value and will seek to expand their diversity of perspective peers, which take into account the views of a range of stakeholders, including employees and customers. It is because diversity on the board has evolved far beyond the good corporate citizenship model to one based on proven value, with multiple studies validating a performance-based rationale for recruiting women to boards.
According to a 2018 report from the National Center for Women & Information Technology, 57 percent of the U.S. workforce is made up of women, but only 26 percent of technology-related positions are held by women. Alarmingly, a Harvard Business Review survey found that 52 percent of women are leaving their jobs, and some of the reasons for leaving include “macho cultures,” isolation, and difficulty with embodying leadership attributes (Sargent; 2019). Additionally, frustration at work may be a contributing factor combined with opportunities and personal challenges making it more likely that women choose to leave their tech careers behind. This is perhaps something that needs to be addressed by Tech companies’ board culture.
Creating an aligned vision in the company will help ensure that all board members are taking steps to invite diverse people from different networks to join their teams. In addition, it is important to understand what diversity, equity, and inclusion mean to the current board members and staff. What changes they’d like to see within the organization and how they’d like to be involved. Teams must be comprised of diverse individuals that can check each other’s blind spots. Teams should look at their development practices to ensure that they are developing fair systems. Also, the way a job description is written can influence who is going to apply. For example, women tend to only apply to a job when they feel 100 percent qualified. If they see a posting where they only meet 75 percent of the qualifications, they may not apply for the position. A good way to include more people is through conferences as they can be used by members of underrepresented groups to further their tech careers. Conferences in technologies nowadays are a natural place to present different approaches and experiences. They are a place where people gather, to learn from each other and share stories.
Focusing on skills and talents of the ideal candidate but prioritizing those who are underrepresented in the name of equity is perhaps another way to ensure having a more divers board member. These diverse members will be crucial since companies are actively expanding their use of technologies such as AI and big data. Here boards will encounter important ethical issues where having diverse board members with varied experiences will be valuable.
Timmoty James, “The drive for diversity on corporate boards is growing. How do Pacific NW tech companies stack up?”, July 6, 2021, https://news-block.com/the-drive-for-diversity-on-corporate-boards-is-growing-how-do-pacific-nw-tech-companies-stack-up/.
Jenna Sargent, “There’s a diversity problem in the tech industry and it’s not getting any better”, 2 June 2019, https://sdtimes.com/softwaredev/theres-a-diversity-problem-in-the-tech-industry-and-its-not-getting-any-better/.