Jolt Your Corporate Board With A Millennial Like Starbucks
As a female, I am thankful to see the growing attention being paid to the importance of gender diversity on governance boards. As a millennial, I am puzzled about why generational diversity on boards is little discussed or practiced.
How do we get millennials on boards? The issue must become mainstream, and that will require advocacy such that the issue is seen as a winning strategy for the future.
Former Chairman of the Board of General Motors John Smale said that a board’s main responsibility is “the successful perpetuation” of the organization. To preserve an organization does not require the ability to predict the future but rather the ability to think systematically and strategically. The strategy is to have a cross-section of thinking and expertise and that includes diversity of age.
But for millennials to get on boards for public or private companies or nonprofits, the argument cannot hinge on diversity. The issue must be looked at through a strategic planning lens. Call it risk management or a security-, succession-or organizational-resiliency lens. The knowledge and perspective of millennials are critical to an organization’s existence.
The average age of independent board directors is 63.1, and companies like Sierra Bancorp and boat-maker Marine Products have a board age average in the mid-70s. Online furniture retailer Wayfair and software provider Opower have boards that have an average age in the 40s.
Still, the trend towards older boards persists, even though the Pew Research Center recently found that millennials (ages 18 to 34 in 2015) are now the largest generation and labor force in the U.S., surpassing the Baby Boomers (ages 51 to 69). One in three workers are millennials. As an example, the median age of multi-national professional services firm EY’s workforce is 29. Even more impactful for businesses is the $200 billion in direct purchasing power of the world’s two billion millennials. Millennials are a force to be reckoned with.
Including millennials on boards is not about fulfilling the entitlement stereotype that comes with the term; it is about organizational survival and business continuity. Boards need the experience and knowledge of millennials to understand the needs of customers, innovate to satisfy the desires of users, and contribute to a vision that will inspire employees and others to join and stay with the organization.
Advocacy, in addition to being a means by which millennials can get on boards, can be used to make it a winning strategy for the future. Key forces are shaping the need for millennials on boards, but it will not be recognized, supported or implemented until people speak up.
Investors and stakeholders, millennials and organizational leaders need to speak up. They can take their cues from the push for women on boards, where women like the Boardlist founder Sukhinder Singh Cassidy and EY leaders
have committed time and resources to campaign for gender board diversity. Investors or shareholders and stakeholders must put pressure on organizations and existing board members to change policies and practices. Millennials must show that they want to contribute. They, and particularly female millennials, must recognize their value and desire to be on a board. Leaders of companies and organizations must be open to the idea and appreciate their understanding of technology, consumer preferences, new business models and current communications styles.
Speaking up now and making millennials on boards mainstream is an organization’s strategic opportunity to secure their future. It is the responsible thing to do.
Clara Shih is CEO & Founder of Hearsay Social and Member of the Starbucks Board of Directors