On 16 February 2012 I emailed the following note to Ilene Lang, President and CEO of Catalyst www.catalyst.org, copying the note to the 12 other members of the organisation’s ‘executive staff’. The gender balance of this group was as you’d expect: 12 women, 0 men.
Ilene, good morning. I hope to hear from you at some point in response to the email I sent three days ago (below) but in the meantime I’ve started to review some of the material on your website including your report ‘THE BOTTOM LINE: Corporate Performance and Women’s Representation on Boards (2004-8)’. While showing data from which the reader might reasonably infer a link between corporate performance and women’s representation on boards, the researchers state:
Catalyst designed the Bottom Line report series to establish whether an empirical link exists between gender diversity in corporate leadership and financial performance. These studies have examined historical data and revealed statistically significant correlations. The studies do not, however, establish or imply causal connections.
The very first page of the report states ‘there is no significant difference in ROE between companies with the most WBD (Women Board Directors) and those with the least WBD’. This is surely suggestive that there is no causal link between ROE and WBD, is it not? If there were a causal link we’d expect companies with the most WBD to outperform those with the least. And they don’t.
Despite searching for years for any evidence of a causal link between WBD and corporate performance, I have yet to find any that stands up to rigorous examination. The little evidence that exists (e.g. from Scandinavia in recent years) appears to suggest that if there’s a causal link, it’s a negative one. If you’re aware of any evidence showing that WBD cause enhanced corporate performance, would you please be so good as to direct me to it? If I’m not supplied with this evidence before the end of February, I shall be forced to conclude that no such evidence exists. Which begs the question of why politicians and representative bodies for business (e.g. the CBI in the UK) actively promote ‘improved’ gender balance in the boardroom, a move that can only result in women poorly qualified for the boardroom reaching it. Will that be a ‘victory’ for womankind? If so, it seems a very hollow victory to me.
I shall be posting the contents of this email on my blog and I look forward to your response.