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Directors Decide Against Minority Representation on Corporate Boards
Deanna Hartley, 01-12-2009
Despite significant progress in the diversity and inclusion field during the past decade, the majority of corporate directors are not in favor of increasing minority representation on their boards.
That’s according to a recent survey conducted by Heidrick & Struggles International Inc., in association with the Center for Effective Organizations at the University of Southern California’s Marshall School of Business.
“What we’re seeing in the market right now is really unprecedented pressure on businesses. So what we’ve reached is a point where people are telling us relative to board recruiting that they want talent above all else,” said Theodore L. Dysart, managing partner of the Americas for the Global Board of Directors Practice for Heidrick & Struggles, a senior-level executive search and leadership consulting service provider.
From the executive search firm perspective, a major challenge to increasing diversity on corporate boards has been a dearth of qualified executive-level candidates from diverse backgrounds.
“There just weren’t very many people of color who were CEOs of large public institutions or women who were in those roles. We had to look in fresh, new and different places as we were trying to broaden the diversity on a board — and that might be looking for people who were university presidents, people coming out of government service, people who were running divisions of large companies,” Dysart said.
It is up to companies to take a proactive stance in creating a diverse workforce, he explained.
“If you haven’t hired enough diversity at the more junior levels 20 or 30 years ago, you won’t have the people who have matured and had the business experience to be on par with the rest of the board members today,” Dysart said.
“You do diverse populations a disservice if you make huge compromises and put people in the room when they’re not ready because then the other directors have a negative opinion about a diversity candidate.”
Dysart said the results of the survey do not necessarily indicate corporate America has a negative view of diversity and inclusion.
“From my experience in the marketplace, there are a lot of people who believe that inclusion and diversity is really core to a company’s success and success in the marketplace,” he said. “What we’ve got is an unusual data point at an unusual time in our business economy that has created somewhat of an anomaly, and we won’t know if that supposition is correct until we get a few more years down the road and [conduct similar research].”
Given the current economic environment, however, companies are on the lookout for people who have been through traumatic business cycles and major downsizings, he explained.
“[The results are] not one of negativity around diversity,” he said. “It’s one saying, ‘If we’ve got an opening right now, we just can’t use that to do what we believe is right and good, and make compromises to any extent on the talent side to get that accomplished.’”
New Law May Spark Rise in Disability Discrimination Claims
Under the Americans with Disabilities Act of 1990 (ADA), employers may have found it easier to evade lawsuits alleging some types of disability discrimination. But that is likely to change with the establishment of a new law: the Americans with Disabilities Act Amendments Act of 2008 (ADAAA).
The commencement of 2009 also saw the ADAAA go into effect, which could cause a substantial increase in the number of disability discrimination claims.
According to a Jan. 5, 2009, Chicago Tribune article, the United States Supreme Court greatly limited people’s eligibility to file lawsuits and seek compensation under the ADA, a measure that has been upheld for the past several years.
In fact, it is estimated a whopping 97 percent of cases related to disability discrimination went in favor of employers.
The amendments passed by Congress broaden the scope of the term “disability,” thereby offering legal protection to a much larger group of individuals.
For instance, the Act still calls for people to show that their impairment affects a major life activity. However, the list was extended to encompass such activities as standing, bending, eating, sleeping, thinking and communicating, to name a few.
Additionally, under the ADAAA, employers must deem individuals to be legally disabled based on their medical condition, not taking into account medical solutions that serve to remedy the disability.
In a Dec. 9, 2008, news release issued by law firm Pepper Hamilton LLP, attorney Heather A. Hoyt said, “Because employers cannot consider corrective measures that reduce the impact of any impairment on an employee, employers will likely face more employees and prospective employees seeking some form of accommodation. Employers must re-evaluate their hiring procedures and criteria to meet the expansive changes in the ADA.”
