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Quotas for a 'prettier' corporate board?

Does having a woman on a corporate board make it "prettier" and more "colorful?" Josef Ackermann apparently thinks so. The Deutsche Bank CEO ignited an outcry last week over the comment, which he made after a reporter asked him to share his thoughts about a proposed quota mandating women be represented on corporate boards. Ackermann said of the company's all-male executive board that he "hopes that someday it will be more colorful and prettier, too." The Wall Street Journal is reporting that the comment prompted "a bitter response from women across the political spectrum" in Germany.

I can certainly understand why the comment would bother some. Ackermann surely meant it as an indirect compliment, and it was given in the context of sharing the company's efforts to promote women at the company, who make up 16.5 percent of the bank's management. But against a long history of women getting ahead because of their looks--or treated as token decorations--I'm not surprised it ruffled a few feathers.

Still, Ackermann's comment overshadows the really interesting question: Should companies be forced to put women in leadership roles? It may seem like regulatory anathema to U.S. businesses, but it's not unheard of in Europe. Spain, France and the Netherlands all have quotas for women on boards. And in Norway, reports the Wall Street Journal, it's working to increase diversity: Women hold 44.2 percent of board seats there after a law was passed in 2002 stipulating supervisory boards had to include women.

There's little question that quotas would help to correct the imbalance between men and women. That a CEO of a major bank would be boasting that 16.5 percent of his senior executives are female is a testament to how behind most companies are at promoting women. While that may be a good number in the financial industry, it's also disappointing that such low numbers get high marks.

Just as affirmative action helped to recognize past discrimination wrongs, perhaps the only way to get numbers even approaching an equal gender balance is to require companies to include at least some women on their boards. Having women in senior positions would not only benefit shareholders and customers (studies show that companies with good diversity practices have higher stock returns); they would also likely lead to more leadership development for young women and, as a result, a more natural solution to the problem than quotas.

But the argument against such requirements is also strong. Germany has a two-tiered board system, with a "supervisory board" similar to U.S. boards of directors and an "executive board" composed of senior management. I can comprehend a requirement that a woman be on the company's supervisory board--these are people who don't run the company but who watch out for shareholders' best interests, and the number of potential candidates is infinite. It's hard to argue a competent female director couldn't be found for every company.

Still, regulating that a women be on the executive board seems to me to be going too far. Companies should be able to make such decisions on their own, freely selecting the people who run the company on a day-to-day basis without the interference of government rules. In selecting qualified operational executives, there is typically a smaller group of people available for the job (compared to the number available for director positions), as many companies seek internal candidates or people from other companies with highly specialized experience.

Mandating that companies put a woman among the ranks of executive officers may result in more women at the top, but it won't necessarily fix the root issue. Governments should be promoting programs that encourage young women to go into business and science, for example, and expanding protections and benefits for women returning to work after childbirth. Instead of trying to fix the outcomes, governments should be trying to fix the underlying symptoms causing the problem.

By Jena McGregor

 |  February 8, 2011; 8:58 AM ET |  Category:  Corporate leadership , Women in leadership Save & Share:  Send E-mail   Facebook   Twitter   Digg   Yahoo Buzz   Del.icio.us   StumbleUpon   Technorati  
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Comments

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Well, gol danged... Someone should have come up with this a long time ago... I mean, the stereotypical board room is a bunch of over-the-hill, balding white guys who could loose about 50 pounds... No wonder so many corporations are screwed up... A little gender diversity is just what corporate America needs... Who knows, maybe if we get more women in the boardrooms we'll have corporations that actually care about the junk they make for us and, hoorors, care about their customers and their workers...

(But, Bobz... What about the Sarah Palins... You want them on these corporate boards???)

Nevermind... Sorry I said anything...

Bob;~)

Posted by: bobnpvine | February 9, 2011 4:54 PM

I'm so glad I'm not the only person competely annoyed by misuse of "beg the question."

Posted by: Dadrick | February 9, 2011 4:11 PM

Buzz words for skinny, connected, competitive; the fat, thoughtful, cooperative need not apply.

Posted by: citizen625 | February 9, 2011 11:23 AM

Are you kidding? Anyhow, it's pretty disgusting, but not surprising, that hiring females for the boardroom has given us the newest CEO one-up: the cougarrama.

Posted by: johnkwhite1 | February 9, 2011 9:48 AM

Anyone who thinks that people should be chosen for Exec positions because of their sex has an IQ

Although, I would expect this kind of tripe to be written by those who aren't executives.

Posted by: illogicbuster | February 9, 2011 9:06 AM

Ackermann could have meant pretty boys, as well ...

Posted by: a_alex_bryant | February 9, 2011 9:02 AM

Instead of a quota, what about adopting a system similar to the NFL's "Rooney Rule". That rule requires at least one minority candidate be interviewed for head coaching positions. No quotas, but a system which does open the door and broaden the perspectives of the employee. Perhaps a similar rule with executive boards would open minds in the good-ole boys club while making sure that only the most qualified candidates are chosen.

Posted by: curtis2 | February 9, 2011 8:21 AM

blurb with the link on the front page misuses the phrase "begs the question." Have all the Post's copy editors been laid off?

I agree, media have been misusing that phrase for a long time. I think the improper use was born of ignorance but media types (and others) will say "yes, but it has come to mean"............

Posted by: nanonano1 | February 9, 2011 7:29 AM

In America we have quotas for women, minorities or female minorities the most entitled group in America. It does not seem to bother is if we hire and promote people who are incompetent. I think we have determined the positives of getting some great people(who are minorities) along with a bunch of duds is worth it. The politicians have determined we cannot make our own decisions fairly so they are helping us. Our laws and federal and state government hiring procedures make it necessary so why would the same not happen in Germany if the people let it?

Posted by: confussed | February 9, 2011 7:08 AM

In America we have quotas for women, minoritities or female minorities the most entitled group in America. It does not seem to bother is if we hire and promote people who are incompetent. I think we have determined the positives of getting some great people(who are minorities) along with a bunch of duds is worth it. The politicians have determined we cannot make our own decisions fairly so they are helping us. Our laws and federal and state government hiring procedures make it necessary so why would the same not happen in Germany if the people let it?

Posted by: confussed | February 9, 2011 7:08 AM

When you hire a woman in business, you better make sure you like her and think she will be able to do the job... Unlike with a male employee, if she doesn't get the job done, prepare to be stuck with her. Trying to fire her will probably cost you your job... Be sure you know what you are doing..rehearse in your mind what you are going to say before you say it.. one error and it will come back to haunt you.. If she is good looking she will reach for the sexual harassment card. Woman want to be treated like the other male employees....... but not really !!

Posted by: james_m_reilly1 | February 9, 2011 12:15 AM

The Deutsche Bank is a European company, not an American firm. It is inappropriate to use a controversy in European business to launch a sex discrimination dialogue in the United States.

If you want to talk about sex discrimination, fine. But don't justifying the relevancy of the topic by quoting what a person in another culture far removed from America has said.

The belief that affirmative action in America is synonymous with quotas is likewise mistaken, according to my education on the topic.

A study that showed historically better performance for firms that have good gender balance on their boards does not demonstrate a causal relationship between the two occurences. In fact, diversity may be the luxury of firms that are profitable for other reasons.

I see it as a new form of the old saying that we'd have more peace if women were leading government. In 2003, with more women serving in high positions of American government than ever before, we invaded a country that had not attacked us.

Posted by: blasmaic | February 8, 2011 10:39 PM

And tell the copy editor who wrote the home page headline what "begs the question" means. Thank you.

Posted by: Sec3mysofa | February 8, 2011 7:50 PM

pretty is a two-dimensional thing. If that's the nature of your board meetings - to deal with the 2D superficial, then by all means, have a fashion party.

but, well, pretty never took out the trash.
pretty never gets the job done.

pretty sits in corner, incessantly checking that her mascara doesn't run.

pretty is like a chocolate chip. small, tasty in a transient way, and gone before ytou know it.

THAT's what you want in your business ?

lol. pretty.

how about ....sheep....can we hear it for a stray sheep, as well, and a nickel, do I have a nickel? While we're at it, let's add a waterslide and a bell at the end to ring ! WhooopppeeeeEEEEEEE!!!!!

a board meeting ?

Posted by: pgibson1 | February 8, 2011 7:42 PM

Yes, we should have more men cleaning toilets and doing child care in drop off centers...we are all here to learn?

Posted by: judithclaire1939 | February 8, 2011 7:13 PM

What if...several women (small people (BP) had been allowed in with the good ole white boys who took us to Iraq...women might consider cost and need to kick butt...to be Manly and might not want their sons involved...just a thought...

Posted by: judithclaire1939 | February 8, 2011 7:11 PM

Well, a Raymond James employee testified during a FINRA arbitration that he would allow a branch manager to terminate a woman broker or employee just because she is a woman -- but that he would then work with the branch manager to modify the FINRA U-5 form to list a better reason for the termination than just that she's a woman.

The arbitration in question involved a falsified FINRA U-5, a wrongful termination and a breach of contract/partnership against a Raymond James branch manager in Dallas.

What that Raymond James employee said he would do is a violation of federal anti-discrimination laws and a violation of Title VII of the Civil Rights Act.

He literally said he would allow a woman to be terminated SIMPLY because she is a woman - not for cause - just because she is a woman.

He went on to say that the same would apply if someone wanted to terminate based on race -- that he'd work with the branch manager to process the termination but help him write a better reason on the official form. They could just tweak the FINRA U-5 so they didn't show the real reason for the termination.

This is blatant violation of anti-discrimination laws - and then clear falsification of official forms that will follow a broker/employee in financial services through their career.

Of course, this same employee engaged in email traffic with the branch manager in which the branch manager specifically stated that he wanted to keep Raymond James "legally uninformed" of certain issues -- apparently for both their benefits.

The arbitration case is now before a federal judge on a motion to vacate the arbitration award based on procurement by fraud -- perjured testimony, spoliation of evidence, discovery violations -- the whole nine yards.

You can go to the website below and hear the Raymond James employee, Kirk Bell, testifying how he would handle a branch manager who said he wanted to terminate someone simply because she's a woman.

www.myfinraclaim.com

Posted by: bluebonnetsandbbq | February 8, 2011 6:58 PM

blurb with the link on the front page misuses the phrase "begs the question." Have all the Post's copy editors been laid off?

Posted by: webfreddes | February 8, 2011 6:12 PM

How about we don't set any quotas and the best person for the seat sits on the board?

Hey, I can dream can't i?

POSTED BY: BEEPEE

________________

If you're a woman, that's about all you can do.

Posted by: arancia12 | February 8, 2011 5:56 PM

How about we don't set any quotas and the best person for the seat sits on the board?

Hey, I can dream can't i?

Posted by: BEEPEE | February 8, 2011 4:51 PM

Absolutely agree with ENGLISHL! Quotas for females in male-dominated professions should be met with quotas for males in female-dominated positions. Only fair!

Reason more women aren't on executive boards is twofold...women lose time having/taking care of kids...THAT'S a personal decision. Second, many if not most women just don't play fair with men. They use their looks and sexual attractiveness to manipulate men.

Flame on...

Posted by: joy5 | February 8, 2011 4:36 PM

" Companies should be able to make such decisions on their own, freely selecting the people who run the company on a day-to-day basis without the interference of government rules. " Problem is, you just stated they're not doing this. Continuing to yearn for corporations to do the right thing is a waste of time. However I don't think businesses should be "forced" to do this, there must be some incentive from government to balance boards better, since there is no punishment and we all suffer when corporations concern themselves solely with profit and stockholder's portfolios. It remains to be seen that more women board members would provide a longer view on board decisions like cutting employees while raising executive pay. But it's clear that gentlemen like the one quoted still don't get it - and if they are good enough to serve on either type of board, women should have no trouble meeting the bar - and raising it.

Posted by: madlyf | February 8, 2011 4:28 PM

If studies show that companies with good diversity practices have higher stock returns, why not simply bring those studies to stockholder meetings when it's time to elect a board?

Posted by: Dadrick | February 8, 2011 4:05 PM

How about a male quota in primary and secondary education, or nursing? If you introduce a quota in male dominated professions, it would only be fair to do the same in female dominated ones. Otherwise, the numerical consequence is government-regulated male unemployment.

Posted by: englishl | February 8, 2011 2:47 PM

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