A company board of directors must be filled with the best-qualified people available.
A company board of directors must be filled with the best-qualified people available.
There is a lot of chatter in all forms of media about comments made by a Government minister that there needs to be more diversity on company boards of directors.
From what I have seen and read the reactions to the statements range from deep offence (and a complaint to the Human Rights Commissioner) through to strong support.
I don't buy into the argument that the statements made by the minister are simply "virtue signalling", but I do have concern that employing just for diversity's sake could raise unnecessary risk for an organisation.
Put simply, the person in a director role (or any role for that matter) should be the one most qualified to undertake it. So, when it comes to recruitment, diversity should be a component of the overall decision – combined with skills, experience and understanding of the organisation and its environment.
I think the minister's comments reflected this, but unfortunately were easily misinterpreted as a clarion call for men in their 60s to move aside now.
We all know examples of what I would call "curious" appointments at governance level – the saying "it's not what you know but who you know" can be rolled out from time to time. However, these days most if not all of these appointments are supported by a robust process of selection.
The people in governance that I encounter have emerged from such processes and rigour to bring things to the table that materially enhance and improve the business or organisation.
There is also a small pool of highly successful directors and, because of their success and reputation, you find their names popping up regularly on boards. This leads to a natural trend of "older" and experienced directors. Directors being retained for their wisdom and experience, which is accumulated over a long period of time, is not necessarily a bad thing.
Probably the minister would have been better to frame her comments in the mode of questioning how businesses and organisations are addressing succession at Governance level and responding to a changing environment.
And should there be more women in leadership roles? Yes, unequivocally, and I believe over time an imbalance will right itself.
However, recruitment in any form should never be about just "filling a gap" or doing what others might perceive as "the right thing for the time" – the fit of the person to the role is what is required and it is crucial. My personal stance is not to hire when the right person doesn't emerge from the recruitment process (regardless of the impact on workflow, etc). The most effective teams are a mix of skills, experience and profiles, and the results and achievements over time will reflect that.
Cohesiveness and good decision-making come from having the right balance of wisdom, talents and diversity. Properly harnessed, this can be extremely powerful — but the lesson here is not to have Beauden Barrett propping the scrum.
Russell Bell
Balance Consulting is a Whanganui consultancy specialising in business strategy, process excellence and leadership mentoring — contact Russell on 021 2442421 or John Taylor on 027 4995872.
