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More women on corporate boards can help increasing focus on corporate social responsibility and the control functions of the board. The level of creativity, though, would not necessarily be affected, despite the common belief women have more of it. These are the main points of a new study from BI Norwegian School of Management.
Though as small and far from the center of political and economical stages, Norway has been at the forefront in the area of gender equality, and has introduced legislation mandating 40 percent representation of both men and women on the boards of directors in public limited companies (ASA companies). This pushed the percentage of women on the boards of these companies up from the original six percent to the current level of more than four out of ten.
Companies not subject to the law have followed along, increasing female representation on their boards.
What happens when more women enter the board rooms? Does increased diversity result in more efficiency on the boards? In what way do women change how boards work? Could increased female representation promote creative discussions in the board room? Have boards improved their strategic discussions? Do women make boards tougher in terms of control functions? Are companies more conscious of their social responsibilities?
A higher female factor per se does not greatly affect the work of the boards. Gender only is not a major determinant: if women are to make a difference, they must bring genuine diversity and real differences into the board rooms, and the boards must be able to utilise this diversity.
One of these diversities is women’s higher focus on issues like control functions and corporate social responsibility. Which is, for sure, good news, in a time when economic downturn is making companies rethink their role within society – that is, they are starting to think they should not limit their attention to market only, but take into consideration the consequences their actions can have on society as a whole.