April 05, 2016 Practice Points

The Case for Women's Leadership

By Kathryn B. Rockwood

On March 21, 2016, an article entitled “Why Men Must Advance Women’s Leadership” appeared in NJBIZ, by guest columnist Barry Ostrowsky, CEO and President of Barnabas Health. Recognizing that women make up a fraction of leadership positions at publicly traded companies, yet half of the full-time workers, Mr. Ostrowsky argues that men must play a part in “ensuring equal access to leadership for women.”

Perception vs. Reality
In answering the question as to why there are not more women leaders, the article points to the perception that there are not enough qualified women to assume executive leadership roles. In reality, it is a simple lack of exposure to those exceptional women that causes women to be underrepresented in positions of power. As stated by Mr. Ostrowsky, the “reality is that most board seats are still filled through informal contacts made through the ‘old boys’ network,” and that the discussions of board membership happen “exclusively in male spaces, like the men’s locker room after golf.” Women do not have a similar opportunity to make their case. According to a report by Executive Women of New Jersey (EWNJ), the “traditional pipeline” for filling of board seats is from a pool of retired CEOs or senior business executives, which perpetuates the existing problem. This in turn is enforced by the lack of turnover by board directors, limiting the number of available board seats.

Why Should Men Assist?
While women are capable advocates for themselves, the reach of their influence is sometimes stymied by barriers that exist outside of their control. Thus, by advocating for women in exclusively male dominated spaces, men would succeed in leveling the playing field. The end result, as proposed by Mr. Ostrowsky, goes beyond just diversity for the good of society, to diversity for the good of the company. Indeed, research has shown that companies that have boards with higher numbers of women deliver better returns on equity, sales and capital. Simply put, diversity makes good business sense.

Bold Action
Mr. Ostrowsky calls on his fellow CEOs to pledge to adhere to the recommendations for increasing gender diversity in the EWNJ report, “A Seat at the Table: Celebrating Women and Board Leadership.” Those recommendations include the following:

•Commiting to include at least one woman on every slate

•Appointing internal advocates to establish a formal pathway for women to senior leadership

•Utilizing professional search firms to create diverse pools of candidates to fill board seats

•Conducting an inventory of the skill sets of the existing board members to pin point gaps in knowledge, and look to tap executives with experience in a breadth of fields such as global branding, human resources, risk assessment, and social media

•Identifying senior and mid-level women within their own companies who have potential to serve as directors.

Mr. Ostrowsky asks his fellow CEOs to further commit to applying these recommendations to increase both racial and gender diversity. And not simply because it is the “right thing to do” from a social standpoint. Mr. Ostrowsky opines that diverse boards outperform their industry median by 35 percent and are crucial to the long-term success of a corporation. Ultimately, creating and establishing inclusionary practices benefits an organizations future, social awareness, and financial growth.

The article concludes by noting that on May 5, 2016, the EWNJ will recognize companies that succeed in implementing pathways for progress in these areas at the Salute to the Policy Makers Gala, for which Mr. Ostrowsky will serve as the honorary chair.