Women make up half the workforce in America, yet they hold fewer than 20% of board seats among the 2017 Fortune 1000 companies.[i] However, the Fortune 1000 companies are comparatively progressive, given that nearly 90% of the world’s board seats overall still belong to men.
It’s important to have women serve on boards. Studies show that companies with women on their boards tend to perform better, mainly because of the fresh perspectives women bring to the table. What’s more, women comprise 47 percent of the U.S. labor force, and they account for up to 85 percent of all consumer purchases. It just makes sense that companies would want to get a female perspective on important issues affecting their business.
One reason why the percentage of women on boards is so low is that there aren’t enough women who are well positioned to serve as a director. It takes more than in-depth business expertise to be ready to serve. Women also must understand the legal and fiduciary responsibilities of independent directors, have a well-crafted “board biography,” and be backed by a network of mentors and other supporters.
There are now several programs with the mission of preparing women to fill the pipeline for potential corporate and non-profit board membership. One of those programs is known as onBoarding Women, run by Deloitte in conjunction with the Perkins Coie law firm, the recruiting firm Spencer Stuart, and the Madrona Venture Group.
This particular program is specific to women located in the Pacific Northwest of the United States, but Deloitte offices around the country have similar programs tailored to local and regional needs. Deloitte’s Center for Board Effectiveness sponsors nationwide programs that share its own thought and content.
The onBoarding Women Program
Gillian Crossan, Managing Director and Lead Client Service Partner, along with Ed Thomas, Seattle Managing Partner, both with Deloitte, lead the onBoarding Women program. “We feel this is an important program to improve the number of qualified women who are comfortable with the responsibilities of being on a corporate board,” according to Crossan. “We, along with our co-sponsors, look at the marketplace, the clients, the connections, and the network we have. And we look at who we think would be very qualified to fit into a director role and invite them to go through our program where we help prepare them to serve.”
The program participants, called cohorts, meet once a month over a span of six months. “We cover a variety of board topics,” says Crossan. “We start with an introduction to board governance, covering the legal and fiduciary responsibilities for being on a board. We talk about board committees. We talk about how to develop your ‘board bio,’ and by the end of the session, everybody who is participating will have a board bio. We talk about risk and strategy, and that’s where topics like cyber come up. Technology risk, disruptive technology, and cybersecurity are really important board room topics today.”
Not only is there an educational aspect to the program, but the cohorts are paired with mentors that are already serving on public company boards. “We leverage that group of sitting board members quite heavily within our program,” says Crossan. “Throughout the program, we leverage them for speakers and on panels to talk about various topics such as board recruitment, for example. We ask them to talk about how they got a first start on a board, and how they select what type of organization to join as a board member. We have some phenomenal sitting board members who’ve really helped us mentor and coach the cohort group.”
onBoarding Women has already hosted three cohort groups. For the most part, the program participants have been referred by previous cohorts and mentors and other local business leaders. “Our business network helps us find amazing women that we reach out to, and invariably they want to be a part of our program,” says Crossan. “We tend to recruit very senior level people, and we try to be quite broad in our scope because the board room today is not like the board room of 20 years ago. Technology is becoming increasingly important. Women in CISO roles who are able to ask the challenging questions pertaining to technology risk make good candidates for our program, and are a phenomenal addition to a board.”
A critical piece of getting onto a board – and this is not specific to women – is the network the person builds. “We recommend that cohorts be very intentional about who is a part of their network. This would be people like the mentors we assign to them, as well as the CEO and board members of their own company, and other high-level and well connected executives,” says Crossan. “The network can help a cohort make the right connections and find the right opportunities.”
The onBoarding Women program also gets women thinking about themselves. Why do they want to be on a board? What do they hope to get out of the experience? What types of companies do they want to work with? What do they have to offer a board, and what types of companies would find their experience most valuable? The people who have answered and internalized these questions – perfected their elevator pitch, so to speak – and who work through their network are the people who get onto boards the fastest, according to Crossan.
Something the cohorts develop during the program is a “board biography.” This type of biography focuses on those areas that a board would be interested in; for example, governance experience. “Looking at board committees, whether it’s the risk committee, or the audit committee, or compensation, or any of the others, we tell our cohorts to think about what experience they have that is going to be interesting to those board committees,” says Crossan. “The board biography is not intended to be a repeat of their resume, but rather what it is about their governance experience that would most resonate with a particular board. They need to think about the issues that boards are facing today and really be articulate about that. We suggest that people have multiple versions of their board bio, appropriate for different industries or sizes of companies.”
According to Crossan, so many boards today have a matrix of what they are looking for within their next board member. They’re looking at the bios of individuals and comparing them against the matrix of the various skills that they are looking for—some of which may well be technology or information security. The board bio has to be from that governance perspective in order to garner consideration. Crossan stresses that cohorts should leverage their network of advisors to review and refine that biography.
Another important channel is working with a search firm that specializes in filling board appointments. That search firm can provide advice on developing a board bio as well. In the case of the onBoarding Women program, Spencer Stuart fills this role of helping to find qualified candidates for various board opportunities.
The Benefits of Being on a Board
“Not just for a woman, but for anyone, I think that being on a board really broadens your view and increases your business acumen. This helps make you a much better leader in your own organization because you learn a huge amount about leadership and governance, what works, what doesn’t. You’re experiencing situations within the board environment that you may have not experienced within your own organization,” says Crossan. “For example, if the board is evaluating merger and acquisition activity and you’re part of agreeing and providing governance around that M&A, and that should happen within your own organization, you have a lot more to bring to that conversation and leadership within your own company than you would have if you didn’t have that board experience. There’s a ton of learning that you do from your peers.”
Experience is nice, but what about remuneration? Naturally, the expectation is that with responsibility comes compensation.
Board members for a public company are typically paid an annual salary and a performance-based bonus, often in the form of company stock. According to the Spencer Stuart Board Index 2016, the average total compensation for board members of public companies is $285,065. The Lodestone Global 2016 Private Company Board Compensation Survey reveals that the median total compensation for private companies is $36,000. Keep in mind that private companies often tend to be family-owned. The vast majority of board members of charitable non-profit organizations are not financially compensated; however, many nonprofits adopt travel reimbursement policies for board members.
What a Recent Cohort Has to Say
Vanessa Pegueros is Vice President and Chief Information Security Officer for DocuSign. She lives and works in Seattle, giving her good proximity to the onBoarding Women program in her city. She’s a recent graduate of the program and found it to be beneficial in helping prepare her for board membership.
“For me personally, I think the biggest benefit was learning how to build my board bio. Also, it was useful to learn about the process of getting on a board, how the interview process typically goes, as well as the purpose and structure of boards,” says Pegueros. “And I can’t say enough about the people I met through this program. What I walked away with is, you can have the board bio, you can have all the experience and the right credentials, but when it comes down to it, getting on boards is about your network of people and ensuring that you have a strong network, which women don’t seem to do that as much as men.”
Pegueros says that as a result of the program, she started reaching out to her network of people to let them know of her interest in joining a board. “One of the people I contacted was the former CEO at DocuSign. Plus, I got to know one of our current board members on the DocuSign board. I reached out to him. I’ve been doing more outreach to people that can help me.”
Pegueros has advice for anyone who thinks they might want to join a board. “I would say, really understand why you want to be on a board, in terms of how it plays into your interests, your passions, what you want to do,” she says. “I think some people might be attracted to the compensation aspect of board membership, and that’s OK, but it’s also important to realize you have to have a skill set that a board wants. Cybersecurity is such an important topic for boards right now that I think anybody in the space who’s at a senior enough level and who has that ability to advise from a governance standpoint could be a valuable asset.”
“Security leaders who become board members aren’t expected, or even wanted, to solve a company’s operational problems,” says Pegueros. “What you have to focus on is the governance aspect, the risk management, the stuff that isn’t necessarily technical and operational in nature. But you can advise by asking how the company is managing the risk. What is the governance structure in the company for information security and risk management?”
Other Resources Prepare Women for Board Membership
The Seattle-based onBoarding Women program is focused on getting women into the board pipeline, but it’s not the only program to serve this purpose. Many of the business schools within large university systems have programs around corporate governance and the board. For example, Foster School at the University of Washington has a program specifically aimed at women. Schools like Columbia, Stanford and Harvard have programs on this topic to get people the education they need to be a board member.
Another major resource is the National Organization of Corporate Directors, or NACD. Note that NACD individual director membership is exclusive to active directors, so it’s not going to teach how to get onto a board. However, it’s a worthwhile organization from a training and knowledge perspective, and also from a networking perspective, to get connected to other corporate directors.
Conclusion
Serving on a public, private, or even non-profit board of directors can be a rewarding experience. It can help to further a person’s career by expanding their knowledge and business acumen, and most importantly, their personal network. Women, especially, need coaching and mentoring to get properly positioned to attain a board seat, and programs like onBoarding Women and others around the country are helpful in this regard.
[i] 2017 Gender Diversity Index