Does Diversity Among Board Members Matter? Some Say "No"!
It’s no secret that corporate boards of directors are somewhat lacking in diversity. According to data from Spencer Stuart, only 15 percent of board seats at the top 200 S&P 500 companies are held by racial minorities and only 21 percent by women.
We’ve frequently made the case that diversity and inclusion at all levels of an organization, but especially at the executive and board of director levels, makes powerful business sense for companies. As the U.S. market becomes more diverse and as countries like China and India and nations in Africa gain increasing buying power, U.S. companies need to understand diverse tastes, attitudes and values if they are going to compete effectively.
Yet, recent data suggests that not everyone is in agreement with that premise. In a Fortune article, Claire Zillman reviewed the results of a PwC survey of approximately 900 corporate directors. The survey found that while 73 percent recognize diversity as beneficial, 16 percent said that gender and racial diversity have no benefits at all, with 11 percent saying that because their boards don’t have such diversity, they weren’t in a position to answer the question.
“What’s perhaps just as concerning,” writes Zillman, “is how directors split at a more fundamental level, with large swaths of respondents—33% and 24%, respectively—saying socioeconomic diversity and racial diversity are ‘not at all important’ to fostering diversity of thought in the boardroom.”
The PwC survey also found that 58 percent of directors feel their boards have achieved racial diversity, despite data – such as the Spencer Stuart study referenced above – showing that board membership doesn’t come close to reflecting the same diversity as the nation as a whole.
Here are the top 6 findings from the survey; we think you’ll find the results both interesting and discouraging.
While it is encouraging that a strong majority of respondents saw value in diversity and inclusion, the fact that such a large minority saw no benefit at all points to ongoing systemic challenges to promoting greater diversity and inclusion at all levels of an organization. Be inclusive!