More women and minorities in power
The New York Stock Exchange has a new initiative to help its companies recruit more women and minorities to serve on their board of directors.
The CEOs of 15 companies serve on the Board Advisory Council, which nominates candidates and connects them with board leaders through networking events. One portion has become known as the “speed-dating” part: Candidates get five minutes to give their “elevator pitch” to each company leader before a buzzer sounds. The first event was held June 25 and the next will be in December.
The Associated Press recently spoke to NYSE Executive Vice Chairman Betty Liu about the Board Advisory Council.
Why did the NYSE decide it should have a role on board diversity?
It just kind of dawned on me when I came back from this road show that, look, we have the most unique community of companies here. If there was anybody that needed to source a board candidate, those candidates must be in our own community of 2,300 companies.
I’m fascinated by the “speed-dating” aspect. What was the reaction?
People just thought it was fun. I joked that this could either be a tremendous success or a disastrous failure. It could go one of two ways, and luckily, it became a tremendous success, and people were very into it. It was a little awkward in the beginning. People thought, how’s it going to go in five minutes? And everyone loved it. It just brought an energy to the room.
What is driving the pressure on companies to diversify their boards?
One, it’s the right thing to do. The second is shareholders. I think more and more shareholders are demanding that of their companies. It’s seeing where the hockey puck is going. It’s where the public sentiment is. I think that’s also causing leaders to sit up and say, “you know what? I don’t want to be behind the curve on this. I want to be ahead of it.”
What are the biggest challenges when it comes to achieving board diversity?
The biggest obstacle is the network. Some of the CEOs I talked to said, “if I’m having a hard time finding a candidate, it’s not so much that there aren’t candidates out there, it’s that my network’s not big enough.” When I heard things like that, I felt, “let’s expand that network.”
What are your thoughts on best practices for recruiting diverse candidates?
CEOs and boards are expanding their definition of what makes a good board member. Because if they look at just title, a former CEO or a CEO, then that pool is naturally very narrow. There are many women and minorities who are very capable that might not have that title. Go beyond title. What’s the skillset, what’s the type of person that you need on that board?