In re: “How Many Women Does a Good Board Need?” by Lisa M. Ferri in Corporate Board Member January/February 2007

I first heard Vicki Kramer discuss this research on a local radio talk show. She said her goal was “to prove the hypothesis” that 3 women on a corporate board “actually make a difference.” Strange, but I thought the objective of academic research was to test the viability of a hypothesis, pro or con, rather than drag the data kicking and screaming toward some pre-conceived conclusion.

The latter is exactly what our Wellesley Center trio has done. They began with a conclusion and then found the feedback to support it from 50 “company directors (all of them women), 12 CEOs (three of them women) and seven corporate secretaries (six of them women) from Fortune 1000 firms (where there are about 1,100 female directors). That would mean a .045 response rate.

The research is riddled with statistically suggestive opinions such as “one male CEO said” and “one female board member recalled.” There are “instances” and “sometimes” the women on boards “felt.” One woman alone “can and often does have a significant impact.” Two women on a board “change things.” And when three or more women serve on a board together, “the magic seems to occur.” Magic is not measured to any statistically significant degree, but fairy powder IS powerful stuff.

This research is not even cited on the Wellesley University public information web site, which raises the question of whether Wellesley’s Center for Women research had this document reviewed by serious academicians.

This is not, as the researchers allege, even “the first” research conducted on the subject of women on public corporate boards. That research, some of it spanning the past 20 years, had found that there are many “first women on board” who are NOT invisible or silent by any stretch of the imagination. Based on my research into the women on the Fortune 1000 firms located in California, I would never suggest that the solo women on corporate boards were anything other than some of the finest individual leaders in business today. “Outstanding” is how I would describe them.

In fact, according to Catalyst Inc., the Fortune 500 firms alone had 238 one-woman boards in 1995 and 182 one-woman boards in 2005. If even a significant share of these women were “invisible,” hesitant to speak up for themselves, or shy about raising difficult issues, then why would a corporate board want to ADD more women to the mix? In my research, I’ve found these women to be incredibly competent, capable of presenting themselves very effectively, and certainly not in need of any form of “girl gang” to back them up in deliberating in very technical areas of boardroom governance.

Marion O. Sandler, co-founder of Golden West Financial (the only Fortune 500 firm that ever had a majority of women on their board), said that “responding to questions about stereotypes only serves to perpetuate stereotypes. Don't fall into that trap. Don't further the stereotype. And don't get yourself segregated into women's groups."

So much for the “girl gangs.”

If women were so hesitant to speak about sensitive issues, in all likelihood we never would see boards go from 1 woman boards to 2 woman boards or to 3 woman boards. Women have been effective in identifying other competent, talented women to bring on board. But, as most male AND female directors will state – categorically – it is NOT because of gender, but rather because the competent women brought into the boardroom the skills, expertise and independent thinking that contemporary boards need.

Women bring significantly more to the boardroom than just knowledge about the households (working mothers, healthcare, and product selection). Today’s women are talented chief financial executives, general counsel, and chief technology and information officers. They’re much more than homemakers.

Great boards may not necessarily be boards that avoid conflict. Today’s women on boards are able to negotiate and strategize with the best of the big boys.
Citi's Sallie Krawcheck (now on the board at Dell) once said "As a CFO one has to have the strength of character, the thickness of skin, to be able to deliver bad news as easily as good news."

According to research by Professor Margaret Neale, (the John G. McCoy-Banc One Professor of Organizations and Dispute Resolution at Stanford Graduate School of Business), more homogeneous teams tend not to expect conflict, so they may not be prepared to handle conflict well. Group conflict, in the sense of intellectual conflict, debate or controversy, actually makes a team function better and be more willing to innovate.

“One of the most interesting recent findings in the area of work-team performance,” says Neale “is that the mere presence of diversity you can see, such as a person’s race or gender, actually cues a team in that there’s likely to be differences of opinion. That cuing turns out to enhance the team’s ability to handle conflict, because members expect it and are not surprised when it surfaces.”

That suggests that WOMEN, as board team members, also have to have the ability to deal with conflict, effectively, not merely try to diffuse it.

Finally, I don’t suppose that any of the researchers happened to talk with Lucille S. Salhany, Sari M. Baldauf, Carly Fiorina or Patricia Dunn from the board of Hewlett-Packard. Until 2005, Salhany-Fiorina-Dunn were a “magical” trio on one of the world’s most dysfunctional boards. In 2006, the female board trifecta was Salhany-Baldauf-Dunn when the board’s dysfunctionality reached epic heights. No “magic” there!

The problem with the HP board was not necessarily due to Dunn-Fiorina-Baldauf-Salhany being shy and retiring -– each and every one of them would be a highly valued asset among most good governance boards. The problem was that governance and leadership are complex issues requiring a significant investment of intelligence, time, and effort. A board’s “DNA” really has very little to do with the gender of its members.

The success of a board has everything to do with the capabilities, breadth and depth of experience of its directors and their shared willingness to pursue solutions that best represent the long-term interests of 100% of the corporations’ shareholders and stakeholders.