As some Loungers will already know, board diversity is a topic that I’ve studied for several years. Together with Lissa Broome and John Conley at the University of North Carolina, I have built on the type of ethnographic research for which John, an anthropologist, is justifiably well-known. At some point during this week’s mini-symposium I’ll put up links to our articles for anyone who is interested. We are also working on a book on board diversity, which I hope we’ll have finished by the end of this summer.
In this first post, though, I just wanted to talk a bit about what intrigued us about board diversity as a research topic and why we felt it was important to hear what directors themselves had to say about diversity efforts in the boardroom. We were struck by the frequency with which the business case for board diversity is put forth by the popular press, shareholder activists, and directors themselves, despite the lack of empirical support (we review the literature here, for example). We wanted to hear directors, in their own words, discuss board diversity – was it actively pursued by the boards on which they sit? If so, why? What benefits did they believe stemmed from a diverse board? Our interest was made all the more salient by events in Europe, where many countries have adopted board gender quotas (a point that will likely be discussed by some of our guest bloggers this week.)
Working from a topical outline, we conducted open-ended interviews with 57 directors of publicly-traded corporations and a limited number of other persons of interest (for example, institutional investors, executive search professionals, and proxy advisors) asking them to share their views on a variety of corporate governance and boardroom issues, including the effect, if any, of race and gender diversity in the boardroom. The interviews range from forty-five minutes to two hours in length and each interview is taped and transcribed. As a group, we then listen to each taped interview at least once with transcript in hand, analyzing each interview qualitatively with a focus on the themes that the respondents identify, the emphases given to these themes, the stories (or narratives) that they tell, and the details of the language that they use. We also thematically code the transcripts and use sorting software to get another, complementary view of the frequency and distribution of the various themes.
As we discuss at length in our published work, several overarching themes have been pervasive in our interviews: First, there is near-unanimous agreement (with only one clear dissenter) that board diversity is a good thing, a valuable outcome that is worth striving for. But second, it is very difficult for our respondents to provide examples from their experience of when board diversity has made a tangible difference. We have heard abundant stories about when other kinds of diversity—what might be called functional diversity: different business backgrounds and skills, for example—have made a difference in how effectively boards do their work. But pressing respondents for comparable stories about demographic diversity has yielded very little beyond awkward silences. Respondents have sometimes commented on that very awkwardness, noting how difficult it is to talk about gender and—especially—race making a difference without engaging in essentializing or stereotyping.
But even if they have found it difficult to give concrete examples of the benefits of director diversity, our respondents have provided well- developed (and perhaps well-rehearsed) conceptual arguments. I’ll be back in later posts to discuss some of those arguments and the inherent tensions in them.
The “What’s The Return On Equality?” Mini-Symposium: