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Diversity in the boardroom: Only attention to respresentation and woman's quota is not enough

Date:30 September 2021
Professor Floor Rink (photographer Elmer Spaargaren)
Professor Floor Rink (photographer Elmer Spaargaren)

Each fall, the Female Board Index is published containing the most recent percentage of female top executives and supervisory directors in the Netherlands. This index enjoys much media attention because the growth of the number of women at the top is still alarmingly slow. Recently, there has even been talk of stagnation and relapse. In the Netherlands, gender inequality at the top is remarkably high compared to other European countries. 

The women’s quota: the solution to inequality at the top?

In 2020, the percentage of female directors was 12.4%.Due to the slow growth of the number of women in top positions the House of Representatives approved the introduction of a women's quota for businesses early this year. It is a rough remedy, but after years of unsuccessful steering towards voluntary targets the government feels compelled to adopt this coercive measure. At least 30% of the members of supervisory boards of listed companies must be women. This requirement does not yet apply to the boards of directors.

A public majority supports the idea that the representation of women at the top should be increased. Yet, another important question remains unanswered. Once women finally have a ‘seat at the table’, are they also seen as equal to their male fellow executives and supervisory directors? This question is relevant because research frequently shows that a person’s standing within a team is crucial for exerting influence over decision-making processes. And in general, we are automatically inclined to attribute more status to men than women, which is one of the reasons why women face systematic barriers in their careers. But do these status processes still play a role for women who have proven themselves and have advanced?

Research into the perception of women’s status and influence    

To answer this question, researchers from the Center of Expertise HRM & Organizational Behavior at the University of Groningen conducted a large-scale study among 61 supervisory boards in the Netherlands, the results of which have just been published in the Economic Journal Long Range Planning. The study consisted of archive research and an anonymous survey taken by 315 supervisory directors. In the survey, the supervisory directors were asked to assess the status position and influence of each other.

Sadly, the data do not paint a rosy picture. Even at the top level, considerably less status is accorded to female supervisory directors than to male supervisory directors, notably by both men and women! And, as expected, the female supervisory directors were less actively involved in decisions on important strategic issues. The differences in perceived status and influence were not explained by possible differences in work experience or professional knowledge between the female and male supervisory directors. The archival data showed that this was not the case. It also did not matter how long the supervisory directors had been working together. The effect only diminished when a board had a female chairperson (in 27% of the boards). The expectation is that gender will then work less as a status signal because a female chairperson makes it very visible that women can even occupy a position higher than men.

Paying attention to the bigger picture

In conclusion, this study shows that a women’s quota is important, but not sufficient. To ensure that women gain influence in the boardroom, the entire composition of a board of directors must be looked at. Who gets a seat on which committee; what is the division of roles; and what culture prevails? Without attention to these points, the percentage of women at the top will increase, but their influence will not. And it is precisely this that lays the foundation for true gender equality.

 

Floor Rink (f.a.rink rug.nl) is professor ‘Organizational Behavior and Identity Management’ at the Faculty of Economics and Business and conducts research into diversity, power and influence relationships, and governance processes.