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Saturday, Feb. 4, 2006

Women still missing at the table

Globe and Mail
Friday, Sep. 26, 2003

Corporate Canada has few women at its boardroom tables and there is little evidence that the situation will change anytime soon.

Research conducted by the Report on Business on 207 companies included in the benchmark S&P/TSX index found that 45 per cent of the country's largest companies did not have a single female director. The study found just one firm -- Corus Entertainment Inc. -- that had an equal number of men and women on its board.

Women also are well represented at National Bank of Canada , which has five women on its board of 18, and at Cara Operations Ltd., where three female directors account for one-third of those at the table. Drugstore chain Jean Coutu Group Inc. also has five women on its board of 16.

Aside from these examples, in the ROB study, most boards with women have a single female director or are so large that the two or three women on the board account for less than one-third of directors.

"The numbers are very small and progress is very slow, and that's disappointing," says Sheila Wellington, a long-time advocate for the advancement of women in business. A decade ago, as head of the New York -based group Catalyst, Ms. Wellington pioneered the idea of counting women on U.S. boards as a way of focusing the debate and sparking change.

Ten years later, Ms. Wellington, now at the Stern School of Business, is diplomatic when describing how far things have come: "The key phase is slow progress from a low base," she says.

At Corus, chairwoman Heather Shaw, is not moving slowly.

Ms. Shaw said the fact that the Corus board currently has five men and five women shows its willingness to go beyond the old concepts of what makes a good director. It also reflects her personal refusal to settle for the status quo.

"Did I have a target? No. But I felt that the population has got to be about 50/50 in Canada, so why wouldn't your board be representative of that," she said.

"I also looked at a really wide pool of qualifications. I didn't just look for a CEO or an ex-CEO, which I think a lot of boards are full of. I looked for other kinds of experiences, so that widens the pool significantly in terms of female candidates."

That willingness to look beyond the traditional board candidate is critical, say those who have thought hard about this subject, as is the presence of a strong internal champion of diversity, such as Ms. Shaw.

After all, they point out, even as women make real progress in moving into the professions and senior management, they continue to bang up against the boardroom's glass ceiling.

Bank of Montreal, for example, has as a goal, to achieve gender equality in the bank's executive ranks by 2007. Women now account for slightly more than one-third of the bank's executives, and the bank has gained awards and accolades for its efforts..

But chief executive officer Tony Comper said recently it will "take a little longer" to get that kind of representation in the boardroom, where women now hold three of the 15 seats. "We're working on it," he said.

The long tenure of board directors is often cited as one of the major reasons why women's progress onto boards is happening at such a slow pace. But others say that is just an excuse for not acting -- much like another common argument that there are not enough qualified women to take board seats. The trouble is not the women or their ability, these people say, it is the way people pick directors to fill the seats.

"The problem is getting people to appreciate the richness in a diversity of points of view and getting people to appreciate that everyone doesn't have to come to the problem with the same perspective," said Patrick O'Callaghan, a Vancouver-based executive search consultant who studies board trends.

Elizabeth Watson, the woman in charge of finding directors for British Columbia's public corporations, including B.C. Hydro, is more blunt about the situation.

"Part of the problem for women is that it is all those old guys who are the gatekeepers," she said.

In British Columbia, Ms. Watson set out two years ago to makes sure the names of qualified women were considered for provincial board appointments. Her efforts have resulted in three or four women on most boards and they are there, she said, not because of some quota or because it looks good, but because they have the skills to do the job.

With their board experience, many of these women are now gaining the attention of recruiters looking for candidates for corporate boards. But Ms. Watson said getting the women on the boards in the first place required more effort to go beyond the familiar, obvious candidates and required someone willing to advocate for their appointment once they had been found.

"You had to make a strong case for them because the women were not known by the people making the decisions."

As grim as the numbers are for women on corporate boards, there are signs that some boards are willing to go beyond the familiar circles to find the right talent and skills.

Guy Saint-Pierre, chairman of Royal Bank of Canada, says, for example, that when director Kathleen Taylor's name was suggested two years ago, he and CEO Gordon Nixon did not know her. But Mr. Saint-Pierre said he thought highly of the people who recommended Ms. Taylor, president of worldwide business operations at Four Seasons Hotels. After meeting her, her name was put forward for election.

"I go back 20 years and I'm sure a lot of chairmen did not name people they did not know. They wanted to know people they appointed on their board."

Jean Douville, a director at National Bank who chairs its corporate governance committee, also sees things changing and says there is no question diversity at the boardroom table is changing the way boards work."

"It certainly does change the dynamics, there is no doubt in my mind," he said. "In practice, I have seen it change."

Mr. Douville said a less diverse board filled with men who have a similar background can be effective, too, but might not see issues from a different angle. "Sometimes the board works well, but it is very simple and it always goes in one direction."

But Mr. Douville said it takes a real commitment to move beyond the comfort of a board on which everyone knows each other and always gets along.

At Corus, Ms. Shaw agrees. "A person tends to look for someone like them -- that just happens. You look for someone in your social circle, a peer."

That's why, she said, it's so important to have a strong advocate for change on the board or in the company.

Her commitment to the issue, she said, also has included some remarks directed at her father, JR Shaw, who chairs the family firm, Shaw Communications Inc.., where there is one female director. "I certainly have given my dad a few digs -- it would be nice to get some more females on the board, that sort of thing -- but that's what I have limited it to. Every company has to make its own choices. It has its own culture."

As the head of a broadcaster and animation firm with a strong female customer base, Ms. Shaw said it just makes sense to have a diverse board, although she said gender has never been a factor in director selection and is not currently one as the company looks to appoint two or three new directors to its board at its annual meeting later this year.

The growing focus on governance and on board effectiveness in general also is singled out by some as the perfect opportunity for women to finally make their mark.

"Boards are getting smarter about all their talent. I think there is an increasing amount of awareness that diversity in all its forms gives you better decision making," said Susan Black, who heads Catalyst in Canada.

The group is conducting its second count of female directors in Canada, and Ms. Black says that when the results are released next year, she expects they will show a gradual upward trend, similar to the half-a-percentage-point annual increase Catalyst has witnessed for female directors in the United States.

Andrew MacDougall, president of executive search firm Spencer Stuart Canada, is more optimistic and says he is seeing improvements in the number of Canadian companies that are adding women to their boards.

Mr. MacDougall says his firm looked at the 100 largest companies in Canada, and found significant improvements in 2003 from 2002. For example, he said, 79 per cent of Canada's largest companies had a woman on their boards in 2003, up from 74 per cent last year. His review found that 48 per cent of companies in this group have at least two women on their boards this year, up from 38 per cent last year. And the number of boards with three or more women has grown to 14 per cent from 12 per cent in 2002.

Indeed, Spencer Stuart's review found that mid-tier Canadian companies with annual revenue of between $1-billion and $5-billion have more female directors than similar-sized U.S. companies. But in the largest tier, with more than $5-billion in revenue, Canadian firms still trail U.S. companies.

But Ms. Wellington, the former head of Catalyst, says there are still many companies that should be doing more.

"It is definitely a failure of creativity for so many seemingly insurmountable obstacles to continually be raised," she said. "If there were a will, I am sure it would be done."

With files from reporter Virginia Galt Application Error

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