Board Diversity, Facebook, and the Dearth of Women in the Boardroom
Facebook, with its 20 something CEO, went public with no women on the board. It was, as a result, big news when Facebook opted to add a woman to the board, Sheryl Sandberg, the company's COO. According to the Facebook website, the board now consists of:
Mark Zuckerberg, Founder, Chairman and CEO, Facebook
Marc Andreessen, Co-founder and General Partner, Andreessen Horowitz
Jim Breyer, Partner, Accel Partners
Donald E. Graham, Chairman and CEO, The Washington Post Company
Reed Hastings, Chairman and CEO, Netflix
Erskine Bowles, President Emeritus, the University of North Carolina
Peter Thiel, Partner, Founders Fund
Sheryl Sandberg, COO, Facebook
The elevation of Sandberg to the board, rather than a progressive step, is little more than a reaffirmation of the status quo. The number of women serving on the boards of public companies in the U.S. is somewhere around 12-16%. Facebook, by adding one woman, now meets the average (one of eight).
What is the explanation for the dearth of women on boards? The most common is the absence of adequate candidates. This mistaken argument focuses on the fact that boards often want current and former CEOs to serve, a category that includes few women.
But that presupposes that boards are mostly made up of current and former executive officers. In fact, companies often have other categories of directors represented on their board. Politicians are one example. Chesapeake Energy had a former Senator (Nickles) and Governor (Keating) on its board. Apple has Al Gore.
One study of large companies noted the following examples: (Chuck Hagel, Senator, Nebraska), General Electric (Sam Nunn, Senator, Georgia), Ford (Richard Gephardt, Representative, Missouri & Jon Huntsman, Governor, Utah), JP Morgan (William Gray, Representative, Pennsylvania), Pfizer (William Gray, Representative, Pennsylvania), Dell (William Gray, Representative, Pennsylvania), Prudential (Gaston Caperton, Governor, West Virginia), Purdential (William Gray, Representative, Pennsylvania), and Honeywell (Judd Gregg, Senator, New Hampshire).
The list shows that companies commonly consider individuals who are not executive or former executive officers for the board but when they do, they commonly pick men, not women. This is not because there are no women politicians (for a list of women who have served in the Senate go here; for a list of women in the House, go here).
So the reason is not an absence of qualified candidates. For a more likely explanation, see Essay: Neutralizing the Board of Directors and the Impact on Diversity.