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There has been a considerable improvement of female representation in many areas of life in the past century: in “2012, women took home more than a third of the medals” awarded at the London Olympics, but more importantly, “the percentage of women on the boards of the 100 largest companies has risen over the past year to a record of 15. 6%. And in the last six months, 35% of new board appointments to FTSE 250 companies have been women” (Braund).
Many countries, led by Norway, have promoted female representation by implementing gender quotas for corporate boards and they do so because gender quotas increase diversity in the workplace and with increased diversity comes many derivative benefits. Increased diversity by itself is a tremendous benefit; “it is in conformity with the notions of equality and representation” (Bilkisu).
By increasing diversity on corporate boards, we can “give speedy increase in women’s representation [and] guarantee ‘equality of results’ for women and men aspirants” and, in doing so, support the concepts of freedom and liberty that this country was found upon (Bilkisu). Furthermore, not only do gender quotas promote democracy through increased diversity, they also help to defeat the tendencies of groups composed of similar individuals.
Corporate boards with members that “have similar backgrounds and have been through similar socialization are more likely than not to share views and presumptions and [are] less likely to engage in vigorous discussion and to challenge management” (Gratton). Sharing views and presumptions and the reluctance to debate amongst one another results in groupthink, in which group members try to minimize conflict by reaching consensus and therefore create an atmosphere of decreased creativity, uniqueness, and independent thinking.
This scenario often exists in all male or majority male corporate boards because “they tend towards ‘the risky shift’ which results in them colluding with each other [and] also lack the diverse networks that are so crucial to effective information search and decision making” (Gratton). Diversity promoted by gender quotas “can provide a wider range of opinion, experience and networking but also can help prevent groupthink that can hinder innovation” (Dong-youb). By introducing more women, businesses can reate an environment that stifles groupthink tendencies and allows for a larger variety of ideas and opinions to be shared.
Introducing more women to corporate boards through gender quotas can help the business “better understand the needs of diverse customers and workers” and with the increasing globalization of the world’s economy, the customer base and work force for businesses are in fact becoming more diverse (Dong-youb). A better understanding of this increasingly diverse group of people allows the business to service their markets properly and enjoy continued profitability.
Additionally, “women appear to be gradually taking control of the economy… women control about 70 percent of household spending” and with women making more of the economic decisions, the need for more women on corporate boards becomes even more glaringly apparent (Bart). Especially “in the consumer sector [where] the products and services… are mainly bought by women,” it is obvious that appointing more women to corporate boards would support the increasing number of female consumers by promoting their interests in business decisions (Gratton).
Companies that choose to ignore this shift in society would be wasting the ample amount of talent that exists already, as well as passing up the “estimated economic benefits and boost to productivity of increasing female participation in the workforce… at 11 percent of gross domestic product” (Coonan). “Diversity at the board-level also provides role models at the top of the corporate ladder that encourage aspiring younger employees with non-traditional qualifications or backgrounds” (Dong-youb).
There have been an increasing number of women enrolling in higher education in proportion to men and an increase in the number of women on corporate boards would provide those young aspiring women with a role model. However, despite all the benefits that implementing gender quotas could have, there has not been as much change on the makeup of corporate boards as would be expected and there is a group of people that “are becoming frustrated by a lack of progress in this area and simply want quotas… as a catalyst to disrupt the inertia and stimulate affirmative action” (Jury).
Cons of Gender Quotas While there are many people who see the benefits of gender quotas on corporate boards and strongly support the implementation of such, there are also people who view a gender quota as “wrong in principle, has difficulties in practice, is tokenistic and is counterproductive to the end goal” (Jury). Much of the view that gender quotas are not the solution to the lack of diversity on corporate boards can be contributed to the belief that “the fundamental criteria for a board appointment must be talent and appropriateness” and this belief is shared by both businesses and the women that businesses employ (Gratton).
Everyone prefers to be chosen for certain positions based on merit as opposed to being picked for other reasons, since being chosen based on merit acknowledges strengths and dismisses any accusations of preferential treatment, especially when selection processes are transparent. Women facing minority representation on corporate boards are especially adamant that they “don’t want to go on a board as a token gesture[, they] want to be there because it’s meritorious” (McFarland).
Women, just like men, want to be recognized for their skills and achievements and not their appearance or gender; “no woman wants to be a token female[,] yet the recent call for quotas of women in the boardroom runs the risk of achieving exactly that” (Mantzarapis). Implementing a gender quota for corporate boards can affect the dynamics of the workplace negatively by promoting the perception that women are only being appointed onto boards due to gender and not ability.
These assumptions and questions concerning the reasons behind the promotion of women all contribute to “undermin[ing] her ability from the start and may make it more difficult for her to prove herself” (Mantzarapis). Even if the company openly claims that its decisions are based only on merit and not gender, the existence of gender quotas alone causes questions to be asked about the reasons behind a promotion or appointment no matter what the real reasons are.
Since a quota system based on gender would undermine the merits of those females who would be appointed to corporate boards, those against gender quotas believe “it would be an insult to women and a great disservice to companies if women are appointed to fill quotas… as standards will inevitably be compromised when an arbitrary numerical target is set against an unrealistic timeline” (Khoo).