Dec 4, 2006

For female directors, three works best

Women have their greatest impact as corporate directors when they reach a critical mass of three or more on a board, a recent study suggests.

The study found that a lone woman on a board can feel like a token whose gender is noticed more than her individual contributions, and even two women can feel as if they are perceived as presenting the "woman's point of view."

The magic seems to occur when three or more women are on a board and the situation begins to seem normal, the study concludes. At this point, women can cause a fundamental change in the boardroom and enhance corporate governance, said co-author Alison Konrad of the Richard Ivey School of Business.

The report is based on interviews with 50 experienced female directors who sit on boards of Fortune 1000 companies in the United States as well as 12 chief executive officers and seven corporate secretaries. The researchers sought out women who sit on multiple boards and have experience on boards with more than one woman director.

Among Fortune 500 companies, only 76 now have three or more women directors. Directors reported that women make a difference in the boardroom because they have a collaborative leadership style that increases the amount of listening, social support and win-win problem solving.

Some people interviewed even said women are more likely than men to ask tough questions and demand direct and detailed answers. But the study found it is difficult for a lone woman on a board to cause culture changes.

Two women together can also develop strategies for raising difficult issues. But directors said that two women are outsiders. Some of the women interviewed said they felt the men on the board saw the women as interchangeable.

In summary, it was found that one woman is the invisibility phase, two women is the conspiracy phase and three is mainstream.

Posted in: Women and Boards