Name: Impact Initiative 2023: Advancing Boardroom Diversity
Uploaded: 2023-09-13
Duration: 15 min 56 s
Description: Deborah Draper, Director, OnBoard Roosevelt Giles, Board Member, Just Capital La Nise V. Hagan, Senior Vice President of Human Resources, OneTen Moderator: Ruth Umoh, Leadership Editor, FORTUNE

Deborah Draper, Director, OnBoard Roosevelt Giles, Board Member, Just Capital La Nise V.  Hagan, Senior Vice President of Human Resources, OneTen Moderator: Ruth Umoh, Leadership Editor, FORTUNE

Impact Initiative 2023: Advancing Boardroom Diversity

Conferences

All right, good morning, everyone. Uh Alan said, great to see all of you here early, bright eyed and bushy tailed uh and welcome to our panelists. Thank you so much for joining Fortune today. Thank you. I'll pose this first question to the entire group. Obviously, this conversation is going to touch on what it will take to advance boardroom diversity. Let's start by level set in. What are some of the major challenges the barriers that you're seeing today to accelerating boardroom diversity was about? Let's kick things off with you. Well, thank you for uh having me and uh you know, one of there, there, there's several things here uh around the board diversity because companies to look at diversity as they, as they step down, especially in the boardroom because the boardroom represents the Supreme Court of stakeholder capitalism, right? And so if you have not been a CEO, if you have not been in the C Suite, therefore, you do not have the skill sets, ok? That's necessary to be a board member. But what we're seeing now is this shift, we're seeing this shift from, from compliance governance, ok? The Banks Oxley and Dodd Frank era to stakeholder governance. And when you look at that shift, it requires a diversity of thought, right? And it requires a whole different mindset as to how you look at risk and the sustainability of the company, I want to turn to you. Uh because in many ways, uh board recruitment uh mimics some of what we're seeing among rank and file employees and some of the challenges we see in terms of expanding diversity. How do we then expand beyond traditional pedigree and form boards based on competency? What does that recruitment model look like? Yeah, great question, Ruth. Um It's really about shifting the dynamic and thinking out of the box. And when you say thinking out of the box, it requires a dynamic effort around recruitment where it's not focusing on traditional requirements. One of the things that we um at 1 10 look for our folks that don't have four year degrees skills first hiring. And so the same thing for a board recruitment process is looking beyond the traditional credentials of having to have an NBA or having been a CEO before. Like what else could someone bring to the table that is not that traditional route or that traditional background? Yeah, it's interesting you bring up that point. Um I noticed in more recent years we're expanding beyond just tap in CEO S for board directors. Um A number of C Hr Os are now, you know, getting, getting selected for board appointments. So, Roosevelt, I'm curious to hear your thoughts on this matter as well. Yeah. The, if, if you, if you look at, uh, lots of companies are global in nature, right? They have global footprints and when they go into a country they don't bring a native. Ok, they hire someone from the host country because that individual understands what the culture understands the market. Right. And so when you look at emerging markets, all you have to do is just look two or three miles around you. All right, it's what you have to do there and on recruitment because again, when you shift into the stakeholder model, there's so many things now around around talent. When you look at technology, having a, having a digital native in things inside of the boardroom, C hr Os, right? Because you're dealing with talent, you're dealing with risk and so many boards look at from the standpoint. Well, if I bring those in, they're just a one trick pony. No, that is, that is definitely not the case. And so boards have to expand that, that realm of knowledge. And that's why when you look at the average age of a board director, you're looking at over 60 years of age, those individuals sit on multiple boards, they have, they've managed their, their personal portfolios, they have grandkids. And when you look at the complexity today around companies, they do not have the bandwidth, they do not have the bandwidth so therefore, that is a risk to the company. OK. And so the, the other part of that is that the, the number of seats around the table have to expand also because of the complexity. And so boards need to really look at and consider adding two additional seats so that they can accommodate all of the oversight. Otherwise that goes directly to systemic risk to the organization, Deborah, you bring a unique lens to this discussion uh from a storytelling perspective. You recently co produced a now award winning film. Congratulations on that. Uh on the first black woman to sit on a board, talk to me about that experience and the progress that this demographic in particular has made uh for the last few decades. Absolutely. Um I'm the writer and director of on board, which world premiered at Tribeca. It's the story of the, the black female trajectory in American board. The very first company in the United States was founded in 16 13. The first black woman appointed to a board was 1971 at the IBM Corporation that's 358 years um into our history. And we are now about 52 years after Patricia Roberts Harris was appointed to the IBM board and 4% of black women hold uh board positions. So that's the facts. Those are, those are the stats, right? But what we're seeing through black women on board is an amazing organization that's really at the forefront of creating awareness among black women where there may not have been awareness, there may not have been interest. Um And these facts are really important about messaging and storytelling. Because in order for people to wanna aspire to be on a board, they have to see it, you actually do need to see what you wanna be. You have to have that visibility. And in addition to assembling all of the facts and figures, we really need to assemble stories and tell stories. Because as people we relate to characters, we relate to stories, we will find out that we're all very similar. But the barrier question is about the previous storytelling, the previous 400 years of storytelling actually creates barrier to entry because people are accustomed for leaders to be a certain way to look a certain way. So collectively as creators and people who sit on boards in corporate entities, we have to find the right stories to be able to push some of those barriers and erase them. We need to see more stories uh like succession, but where the boardrooms are diverse, where the now think about it, think about how powerful film and television is, think about the work will and Grace did think about the fact that on 24 there was a black president before President Obama was already elected. So that Story World was created with the players in the world that the creators wanted to see. So we can create the write worlds and stories and the rest of the world will catch up so that life will imitate the art. I like, I like to add on, I like to add, add, add on to that. One of the things too on, on the on the recruitment side of the house, the traditional recruitment is the fact that you're told to network, network, network, network, create your one page bio uh you engage with a search firm, right? And what you do after that is that you constantly check on your email to see if you get in the, in the email that you have an interview and, and, and your phone. And so I would say that it is much more difficult to get the board interview than it is to get the seat on the board. Much more difficult. And what you have to do. Let me interrupt you. Why do you say that the, because of the fact that when you look at, you've got a, a numb gov chair and you got the CEO and the board had decided, ok, we're gonna need this skill set on our board is it, is what we're gonna need and what do they get in front of them? What a bunch of, of uh bios is what they get. So, women and people of color have to go one step above that and what you have to do with that, you have to put together a board document and that board document consists of the following. It consists of the fact of having a document that speaks to the value of that corporation as you see it, the culture of that organization, how you see it and also the risk associated with that organization and how you see it. And so now by going out and doing your research because board members are expected to be able to do research, right? Because you have all of these issues coming before you in the boardroom and you cannot rely solely on management to do the research. You have to do your own research. And so what this tell the board when I receive this document, OK, outlining how you view us from a value perspective, how you view us from a sustainability perspective. Now you get my attention because I can go directly to this and see where you fit the other piece on. This is the fact that when you go, when you, when you, when you look at going to school, you go to school. I major in finance, a minor in marketing, you know, they et cetera. But when you put together your board document, you need to do the exact same thing. What is your major? Well, I've been a Chief financial Officer for X number of years. I've been a chief human resource officer. So that's my major. But what are your minors? My minor is in technology. My minor is in risk. My minor is in sustainability. And so now again, when they receive that document, they now know exactly where you fit versus someone sending in a one page bio. Right now, they see what your leadership, they see your thought leadership, they see exactly where you can fit in and they see exactly where your skill sets reside. And it also demonstrates to them that you under stand the process very well said. And I, and I want to touch on something that both of you have alluded to. Uh it's a recurrent theme. I'll throw this question to you. Uh I think one of the major barriers, especially for black and brown people get board seats is that we simply don't have the same social capital. And a lot of this is very much based on informal networks. So how do we build those networks for people of color? Yeah, it's about having the exposure. And so when you say the social circles, when you think about certain golf courses, you think about certain yacht clubs, you think about the access to having those networks in the circles they don't exist. There are companies that have seen this and are gearing up to help young black women learn how to play golf, to help um you know, young um African American men learn how to hold certain conversations in a room where you already have this feeling like I'm not supposed to be here. So it's about finding your voice and that authenticity. But it's definitely about expanding beyond just the traditional social circles and really putting yourself out there um to just to again learn and meet new people and not feel like, you know, I'm actually not supposed to be here. It's more about that acceptance of yourself and being authentic. Yeah, that's what I discovered um in telling the story of black women on board. So this idea of the social currency, the social capital and the social network and really expanding that so that they overlap with the traditional ones. So it's just not separate, but they begin to interact and then they begin to become one, right? Because that at the end of the day, all of the social circles should be a single circle about the business of making your companies better, stronger, more diverse, more profitable and, and the, and the research shows that diverse leadership literally makes for more profitable companies. So when those circles combine and they overlap, it won't be such um a big gap between who this particular person can network with, network with or who this particular person can network with. They become the same circle and becomes much more powerful. The other part of this, this goes directly to section planning, right? Um And a lot of companies don't do it well. All right. Um and um when you look at, you know, companies that do get it right, they spend a lot of time on secession planning with the C suite in a couple of levels, but so does below the C suite. But the tendency to not have a tendency not to do it from the board perspective, right? And the board happens to be the institutional knowledge for the organization. So the average CEO tenures around six years and the the the other, the other, the other piece here is that we have implemented a program to allow companies to have succession planning and build that around succession planning and not get into the, into the this fish bowl of, of polarization around diversity. And what I'm speaking to is this, how many of you have heard of the advisory board concept? OK. Now let's put it on steroids. What I mean by that is this, we come up, we came up with a program where we asked corporate America several public and trading companies in the New York Stock Exchange here to take a look at putting an advisory board role on their board. OK? Putting it on their board with the skill set deficit that they currently have on that board and the deficit and the skill they would need looking out four or five years, right? And, and if you look at this, this these individuals sit on the board, they assign to the respective board committees is what they assign to. They don't have a fid, they don't vote, right? But they participate as a full board member, right? And compensate the same. And, and so that is off and running, it is in place and going, we have an sop on that and if you look at it, it's akin to sports sports have what farm teams, right? The pitcher gets hurt, pull up one from the farm team. Right? And so, and what this does is what it takes care of the secession planning issue. It's what it takes care of. And if you have a, a board member that's going to be aging out or want to retire from the board, that candidate can now move into that judiciary slot. The, the uh season board member can move into the advisory role and now mentor the newbie. All right. Now this shows companies are doing what they are bringing in the next generation of board leadership is what they're doing. And if you had a blank sheet of paper, why not? You fill in the blank? Because there is zero risk to that company in doing that. And that is happening now is what that is uh uh happening. There are 17 other companies right now going through the process of uh of uh getting that approved. And so again, it's a no brainer. It is simple and there's zero risk to the company. It is only upside. Yeah. Well, we'll run up on time. So I'm going to end with this. There's a couple of recurrent themes. I'm here in here. First of all social capital is huge. You need mentorship, you need apprenticeships and really to expand beyond traditional pedigree. While we are seeing some progress among more marginalized demographics, we still have a ways to go. What's really important here is to view a diverse boards as akin to risk and obviously boards are in the risk business. Uh Thank you so much to my Panelist for taking the time to chat with us a really robust conversation this morning. Thank you. Thank you.