New research indicates that putting gender-based quotas in place do not result in more female representation on corporate boards. A study by BNY Mellon, and presented at Mellon’s London conference, Womenomics, indicates a far more nuanced methodology to getting – and keeping – women on boards.
Quotas do “work” in getting women on boards, but quotas are not keeping them there. The study found four factors that were influential in appointing women on boards and for longer tenure. The interesting part of the study is that these factors had more to do with societal influence.
- Substantial maternity leave – in companies with generous leave, there were more women on boards and had longer tenures
- More women in politics in general correlated to more women on boards and length of tenure
- The level of economic power among women, which equates to the length of education and percentage of women in the workforce
- Corporate governance that include a written policy with language on gender equality
The last two factors were by far the most influential. Women are attaining advance degrees at rates faster than men and it is relatively easy to write corporate governance policies that include gender equality. The study also found that corporations were more likely to write governance policies when there were higher numbers of women, and educated women at that, in the marketplace.
The area where we still may be lacking is keeping women in the workforce. According to statistics by Catalyst, 60% of women with children under the age of three were in the workforce. Catalyst also showed that the increasing age of children corresponded to more mothers in the workforce. A couple of conclusions can be drawn from these statistics: if a higher percent do not work when the children are very young, i.e., infants and/or toddlers, it is likely that women are bearing the brunt of childcare. It is difficult to take on both a full time job and being the primary caregiver at home. The exit of women from the workforce at an often crucial juncture of their careers may partly explain why there are fewer women on boards. When women do return to the workforce when their children are a bit older, a few years may have elapsed and it may require a step backwards on the corporate ladder. Catalyst also reported that mothers in the work force often worked fewer hours than before, perhaps part-time, likely to accommodate day care and/or school schedules.
The Mellon study is illuminating in that it presents one easy fix: incorporating corporate governance policies. The complex aspect of the picture is that it will take higher numbers of educated women to get companies to write these policies. The takeaway from this study can give us, as a society, something to work on: supporting mothers with young children in the workforce. And not simply for altruistic reasons: companies with more women in executive positions perform better. The logical next step is to work harder to ensure more women get on boards and stay there. To reach that point, however, we need to ensure women stay in the workforce to get to those higher levels of management and be considered for such positions.