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Management France achieved gender balance on boards. Can Canada do the same?

France has achieved gender balance on its boards. It’s not a miracle. It’s legislation. In 2011, the government set a requirement for a 40-per-cent minimum of either gender within six years on boards at large companies.

In Canada, of course, we don’t go in for such heavy-handed government machinations. That’s why we’re at 16.4-per-cent female board members in Toronto Stock Exchange companies, according to Catalyst, which pushes for the advancement of women in business. In 2016, Statistics Canada found that more than half our companies – 56.8 per cent – had boards of directors composed entirely of men.

That won’t change unless we legislate. We have been talking about gender balance for decades and the needle barely moves.

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Will companies fall apart if we try equality because unqualified women will be replacing qualified men on boards? Columbia University business professor Tomas Chamorro-Premuzic’s recent book, Why Do So Many Incompetent Men Become Leaders, suggests that won’t happen because men may not be all that qualified, benefitting from the biases we have that favour potentially harmful traits, such as overconfidence. Women may actually be a better choice.

France is a model. So far, top companies have not toppled. Nor in Norway, which similarly legislated balance.

Of course, in many ways, it’s the operational top team, not the board, that determines a company’s future. Here, France has yet to make huge strides in gender balance, but the hope is the board changes will percolate into the broader company. Currently, 19 per cent of executive committee team members at the Top 20 companies in France are female, compared to 15 per cent at the Global Top 100, according to statistics from the gender-balance consultancy 20-first. That’s only a four percentage point advantage, which seems feeble, but in fact it’s a 26-per-cent lead, given the small base of female executive committee members. In Canada, it’s 15.8 per cent for TSX companies, behind France.

The consultancy gives us a new way to view progress. It ranks companies as “asleep” if there are no women on the executive committee. The organization wins the classification “starting” if there is one woman and a bonus point if she’s in a line or significant profit-and-loss position. Staff roles, such as human resources, legal and communications, are important, but the consultancy says that these rarely lead to the very top.

Companies are deemed “progressing” if two women are on the top team. “Two voices are stronger than one. With two female voices on the EC, particularly in line roles, it’s less easy, consciously or not, to see them as ‘the token woman,’ " it says. “Critical mass” comes when three or more women are on the executive team. It becomes the norm and probably points to a pipeline lower in the ranks of talented women.

Nine of France’s top 20 companies have achieved critical mass. That’s still a big distance from actual gender balance, but at least it’s a step in the right direction.

Canada’s top companies tend to be banks, unlike France, and most have been paying attention to gender balance. So, they tend to have two or even three women on senior teams of about ten to 12 people. The Bank of Nova Scotia leads the pack with seven, according to its website, albeit on the largest executive team by far (30 members), so percentage-wise, it lags some of the others. But the notion of critical mass says more women at that bank are seeing people like themselves at the top. Royal Bank of Canada, with two, lags (but its board is 42-per-cent female).

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Other large companies I looked at weren’t bad but also weren’t great, with the most numerically at Canadian National Railway Co., which has 30 senior officers, five of whom are women. Nutrien Ltd. has two women in its 10-member senior team. Suncor Energy Inc. has one of nine, who is the general counsel. BCE Inc. has one out of a team of 13. Imperial Oil Ltd. has one of six. Power Corp. of Canada is zero for 19, but points to the better gender balance in its constituent companies.

The other companies generally also say that at the next level down, female leadership is greater. Is that a sign we’re at a takeoff point or just window dressing, with change at the apex still likely to continue to be infinitesimal? I’m worried it’s the latter.

Tanya van Biesen, executive director of Catalyst Canada says, while progress is slower than her organization wants, in the past three years, the volume and quality of the discussion has been better and there are signs companies are putting “horsepower and money” into the diversity issue. She says targets can be as effective as quotas if equality at senior levels is treated like a business issue that must be addressed with compensation tied to achieving those targets.

We’ll see.

Cannonballs

  • Helen Pitcher, chair of Advanced Boardroom Excellence, a board evaluation and effectiveness consultancy, says it’s time for more women to be named to head boards. The skills in that position require IQ and hard skills, but even more important are the EQ and soft skills that build on that base, to create trust and to coach, which she says are more often associated with women than men.
  • There is often a debate about which is more important: Leadership or management? But consultant Wally Bock says that there are actually three interrelated skills: Leadership, management, and supervision. Management involves making things work, juggling priorities and tradeoffs, while supervision is the often avoided people part, helping them to succeed.
  • A new trend spotted by the Nielsen Norman Group consultancy in studying top Intranet designs is making a big deal over the launch of a new or updated site, so people know it’s changed.

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