Quota or No Quota?
Since the passing of law requiring publicly held companies based in California to have a minimum of one woman on their Boards of Directors by the end of 2019 there has been a lot of debate about the effectiveness of quotas. Will this forced change make a real difference? Or will it create resentment toward women who are appointed and end up hamstringing their ability to be effective?
This is the classic carrot or stick debate - how long do you wait for companies to do the right thing before trying to force new behavior?
While the word quota makes action feel very forced, I am a big fan of targets and accountability. What is not measured does not get done, and if performance metrics are not aligned around goals no one is accountable for delivering them.
Several European countries set quotas for female representation on Boards years ago, and today 58% of European companies have women in at least 34% of the Board seats. France has the highest percentage of female Board members at 44%, including companies like Kering and Sodexo. Other European company leaders include GlaxoSmithKline, Siemens, Terna, Wolters Kluwer, Proximus and Engie.* . These are major global players in their industries, many with enviable growth and operating results.
There is related debate about whether or not Board targets trickle down to effect gender diversity within organizations. Again, what you don’t measure doesn’t get done. When companies set targets and accountability for delivering them inside the companies the needle does move. It is important to know it cannot - and should not - happen overnight. If it does, it raises an important questions about whether or not a woman is put into a job just because she is a woman and not because of her qualifications. Doing that hurts her and the organization because she is unlikely to succeed and the company then has a case for why this did not work.
When setting these targets and enforcing them, whether you call them goals or quotas, the most important thing to do is to make sure you are bringing in qualified people and setting them up for success. The purpose of the target is to force intentionality around expanding the pool you typically pull from and being sure old patterns are not automatically repeated. It is about bringing diversity of thought and experience to the table for the broader benefit of the company and its clients, customers and community.
Source: European Women on Boards index 2018