Women influencing corporate boards, despite shortage of numbers
By Marjorie Censer,
The absence of women on corporate boards was perhaps never more stark than when Debra L. Lee watched men pass around lipsticks at a meeting of Revlon’s directors.
Even though the cosmetics company targets women, there were mostly men on its board, overseeing its direction, including weighing the colors and packaging of its lipstick.
For Lee, the chief executive of BET Networks and a veteran director, it was a sign of the closed doors that sometimes face women seeking to join boards, which do the important work of overseeing a company and representing its shareholders.
“It’s been frustrating at times,” said Lee, who is also a board member at Bethesda-based Marriott International and District-based WGL Holdings. “It can feel like an old boys’ network.”
There is a push from companies and outside groups alike to improve the diversity, and particularly the presence of women, on boards, but achieving that remains a challenge.
Catalyst, a nonprofit that seeks to improve the role of women in business, found women held just shy of 17 percent of board seats of U.S. Fortune 500 companies in 2012, well below the percentages of other countries. Norway, which requires that women make up 40 percent of boards, leads at nearly 41 percent.
However, the percentage of women board members at the Washington area’s largest companies is even lower. Based on a Capital Business analysis of the largest public companies in the region, 85 of 661 board members — or 12.9 percent — are women.
None of the large local public companies has a majority of women on its board. Bethesda-based Lockheed Martin stands out for having four women directors on its board of 12. There remain many local boards with no women; Silver Spring-based Discovery and Arlington-based CACI International are among the largest area companies without women directors.
There is considerable debate over why improving the statistics remains a struggle. Boris Groysberg, a Harvard Business School professor, said that men and women tend to disagree over the reason for the gap. When women are asked why there are so few women on boards, they typically say that existing board members choose people from their networks — who typically look like them. Men, on the other hand, report that there aren’t qualified women in the pipeline.
Groysberg said he finds that claim disingenuous. “We cannot find a couple of hundred qualified women to sit on boards?” he said. “I think it’s outrageous.”
The perks of increased diversity on a board can be very real for companies. At Revlon, Lee said, the company has increased its women directors to five, better representing its customers and making the board more effective.
Susan Ness, a former commissioner of the Federal Communications Commission and a member of McLean-based Gannett’s board, has spent years studying the absence of women directors.
“Chances are, the guys on the board are not going to be asking the same questions as women, and indeed you want to have a diversity of voices,” she said.
There are obvious benefits, too, for the directors. Serving on a board is a mark of distinction and often offers a boost to an executive’s career. It also pays very well. According to 2020 Women on Boards, a campaign to increase women’s board membership to about 20 percent by 2020, directors are often paid more than $100,000 annually and receive stock options that can be very valuable.
Lockheed Martin, the area’s largest company, in 2012 paid its board members a cash retainer of $130,000 — as well as thousands more in equity and chairman fees.
The women who have made it to these high-level positions often report that it helps them in their careers. Lee said her experiences with other companies helped her manage her own.
“I learned a lot about how other companies, for example, do succession planning or how they evaluate executives, how much the board is involved in things like diversity initiatives,” she said.
Lee said she sought to join boards after watching her predecessor, BET founder Robert L. Johnson, serve as a director, hoping to hone her own management style. Despite her years of experience, she credited her recent appointment to the president’s management advisory board, meant to help the government implement best business practices, with helping her turn a corner.
“It gave me a firm basis for thinking of myself as a CEO and getting my profile out there,” said Lee, who now refers to herself as “overboarded” — meaning she sits on so many boards that she would not add another.
Being a director can also be rewarding in other ways, women board members say. Roxanne Decyk found she was interested in joining a board early in her career. In 1981, a then-28-year-old Decyk took an executive job at International Harvester, as the company tried to stave off bankruptcy. (She said she later realized she got the job so young because more-mature adults knew better than to take such a difficult role.)
As part of her job, she worked closely with the company’s board. “Some were terrific directors,” she recalled. “Other people showed up for the meeting and had a relaxing time, collected their fees and that was it.”
The board made a lasting impression on Decyk, who became a board member herself just a few years later. Though she figured the board role was given to her because of pressure on companies to add women, Decyk accepted and continued joining boards. She eventually went to the University of Oxford to study corporate governance, trying to figure out what makes a good director.
“A lot of it is your personal choice on how you interpret your responsibilities and what you view as your obligation,” Decyk said she concluded. She now sits on the board of Arlington-based Alliant Techsystems.
Eileen Auen, too, reported being the beneficiary of a push to include more women when she joined the board of Fairfax-based ICF International in early 2008.
“They were certainly looking to broaden their representation,” said Auen, who heads a health care company and has helped the professional services giant increasingly move into her sector.
Bethesda-based Marriott International is among those focusing on this issue. About a year ago, Marriott began partnering with WomenCorporateDirectors — a membership group for women directors — to host boot camps for women who want to join boards. (WCD has been putting on the camps for about five years, said Susan Stautberg, co-founder of the group.)
During the one-day sessions, women meet with search executives, learn how a board interview differs from a job interview and practice pitching themselves for a board spot, Stautberg said.
The organization selects a pool of about 20 women, all high-ranking executives or successful entrepreneurs, to attend each camp and provides them with a list of available board spots at the end of the day.
Stautberg said getting onto the first board is typically the toughest part. “Once you’re on one, all of a sudden you’re vetted and everyone wants you,” she said. WCD recommends starting with a small board.
The women who make it to the boardroom report that being one of few women hasn’t limited their ability to speak up. April H. Foley, a former ambassador to Hungary who now sits on the board of ATK, said she was accustomed to being a minority.
“Much of my professional life has been in environments that had lots of males,” she said, adding that the exception was attending the all-women Smith College. “I’m used to it, and I think that’s probably true for most women who serve on boards.”