corporate governance

Actions Speak Louder Than Words

Apple Inc. recently announced that they would be amending their nominating and corporate governance committee charter to include language conveying the need for gender and racial diversity. The charter will state that Apple is “committed to actively seeking out highly qualified women and individuals from minority groups to include in the pool from which board nominees are chosen.” But Apple isn’t acting from its own volition. At the annual shareholders meeting, two investor groups, Trillium Asset Management and the Sustainability Group, proposed a diversity vote that would force Apple to take the necessary steps to ensure gender equality among its board members. Rather than leave it to the vote, Apple came out with its charter amendment.
 
And now Apple will likely find one or more worthy, meticulously qualified women and/or minorities. However, two questions remain: why wasn’t gender and minority diversity already an issue for Apple? And why did it take so long to become one? How quickly will Apple act, since they currently only have one woman on their board?
 
We hope other companies follow Apple’s lead without being forced, and proclaim a commitment to a diverse board. We all know, however, that while charter language is good, actions speak louder than words.

Needed: A New IPO Checklist that Includes Women

Last year, when Facebook issued its IPO without a woman on its board of directors there was huge public outcry about the oversight. Women's organizations called for a boycott; people picketed Facebook's offices in New York. After the company went public it tried to rectify the error by putting Sheryl Sandberg on its board. Soon after that, Facebook appointed a second woman, Susan Desmond-Hellman.
 
History repeated itself this year when Twitter announced its IPO plan. Again, stakeholders who care about good corporate governance and company transparency voiced their outrage that another technology giant would go public without any women in the boardroom. During the IPO launch Twitter CEO Dick Costello sparred with Vivek Wadhwa, fellow at Stanford's Rock Center for Corporate Governance, for his statement in the New York Times, " The fact that they went to the I.P.O. without a single woman on the board, how dare they?"
 
Following the IPO, Twitter announced the appointment of its first woman director, Marjorie Scardino, former executive director of Pearson. When asked about the lack of gender diversity on the Twitter board Costello said it was a pipeline issue. But if Scardino was available after the IPO she was probably available before it, along with other qualified women. Men who use the pipeline argument are out of touch with today’s business environment.
 
In 2013 in Silicon Valley, eight out of 13 companies that launched IPOs had no women on their boards. This situation is not because of a pipeline issue; it's directly related to the male-dominated venture community. Venture firms appoint their investors to fill start-up board seats and venture investors are predominantly white and male.
 

Want to get on a corporate board? Make it your New Year's resolution!

One of the things we learned from our National Conversation on Board Diversity on 12/12/12 is that people want more tactical information on how to get on a board of directors. So, just how do you crack the code? Here are a few tips to get you going. Make it part of your New Years' resolution!
 
1. Make your intentions known:  Work your network, identifying those who are most likely to be in a position to help. Friends, business associates, industry contacts, and your boss may be in a position to help you open the right doors. It's all about whom you know and who knows you are interested in being on a corporate board. If you serve on non-profits, fellow board members could be included in your search.
 
2. Think about industries you know about and identify companies in those industries: Know your strengths and stick to what you know. Identify companies in the industry and closely related fields: your target list. Start with companies close to home, and expand the search from there. If you've had board experience, it may be easier to land a seat on a larger company board. But if you're a newbie, smaller, local companies will be easier.
 
3. Make a short list of directors: Once you have your target list, identify the directors on those company boards. Then work your network. Look to see if you know any of the directors on the boards. If you don't, the people in your network might. That's your short list.
 
4. Communicate your interest: Contact the people on your short list. Try to set up a meeting, preferably a lunch meeting. Express your interest. Ask for support. Be prepared.
 

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