Gender Quotas and the Boomerang Effect

The debate on the system of gender quotas for boards of directors is ongoing and although we should congratulate ourselves on some important advances, there is still a long way to go.

I’m afraid the “coffee for all” approach often imposed in some countries, involving a mandatory percentage applicable to all companies in all sectors, tends to produce a boomerang effect that prevents the spread and effective development of what we need: a culture of diversity.

This interest in diversity dates back to the legal measures promoted in the United States in the 1960s and ’70s, which aimed to counteract discrimination based on gender, race and religion. In 1990, R. Thomas concluded that affirmative action was not the best approach, because large American corporations merely complied with the legislation without adding value . In 1991, Cox and Blake started talking about managing diversity, instead of establishing quotas.

Their major contribution was foreseeing that the nascent trend toward globalization would increase the diversity of the workforce. Managing diversity is a challenge that goes beyond just having adequate recruitment and hiring processes, but that is a good starting point.

Meeting a quota does not add value to the company

This is why I think that spreading the culture of diversity will be more effective through self-imposed quotas , i.e., quantifiable objectives that each company establishes for itself, and must respond with concrete measures to promote the gradual placement of women in management positions and on up to the executive committee and ultimately the board of directors, depending on the circumstances of the company and its natural progression.

There are many examples of best practices in this regard, as diverse as the companies that employ them. Some require a woman to be included in each group of candidates for a promotion, others offer flexible work arrangements; some promote policies to increase or decrease the pace and intensity of one’s career…

A culture that values diversity can only exist if it is reflected in the steering committees , through their decisions: implementing changes that have an impact on formal systems, offering both men and women different options to choose from, as well as changes that have an impact on leadership styles.

But with this challenge, companies are not the only ones with duties. As a IESE professor, I am highly committed to the pedagogy of diversity so that entrepreneurs and executives understand that diversity is part of business. In our classrooms we teach that if we want true high-performance teams, we need diversity (geography, background, experiences, points of view, etc.). To achieve all of this, the greatest diversity comes from being XX or XY.

There are also duties for young ladies and women who become candidates for management positions: they need knowledge and experience and, in general, women need to place more value on the time they spend on social relations both inside and outside the company, and inside and outside their sector. Those are our duties if we want to play the game.

I do not oppose quotas. But I’m afraid, as the latest news from Norway confirms, that having companies impose their own quotas may be more effective in pushing this silent revolution forward, starting with the executive committees. For this reason, I congratulate the team that developed the new Code of Good Governance of the Spanish Stock Exchange Commission (CNMV). The Code includes proposals for Corporate Social Responsibility and sets out to have the selection policy for board members ensure that by 2020 women represent at least 30% of the total. And if that does not happen, there will be no penalties, however satisfactory reasons will have to be given to explain why women were not selected. It follows the “comply or explain” approach.

If we simply aim to meet quotas without addressing the causes of the problem, we won’t always solve the problem, and in fact sometimes may even mask it further. Therefore we need to redefine the problem and work on the causes underlying the lack of equal opportunities in systems, management styles and corporate values. That would certainly elicit a commitment and allow for talents to be maximized.