Though there is evidence that female board membership affects corporate performance, there is little understanding of the mechanics that might make this so. Is it that women are somehow different as leaders? Or is there some other factor at work, like background or experience?
The mechanics of such complex human relations are rarely easy to tease out, and these questions are no exception. However, a University of Southern California research paper by Darren Rosenblum and Daria Roithmayr attempts to shed light on the issue.
In a series of interviews with two dozen board members at some of France's largest 40 companies (alongside additional interviews with legislators, civil society leaders, recruiters, and a couple of others), the authors try to uncover some of the changes that might have resulted from a recent French law that imposes quotas on gender ratios in corporate boards.
As you might expect, the results are fascinating. Though open-ended interviews are necessarily less precise than other forms of analysis, they provide a unique window into the perceptions and nuances of human interaction.
So what did we learn?
Well, first off, France is a little different than the U.S. Apparently, social norms are such that, in the words of one interviewee, "If two people raise their hands and it happens one is a man and the other a woman, the man will systematically propose that it be the woman who speaks first."
As an anthropological finding (or for any woman who has ever experienced the unappealing cousin of this custom, the systematic interruption), the "civilizing effect" of having a female presence on French boards is somewhat interesting.
Many interviewees noted that increased female presence resulted in more thorough and methodical discussion, often touching on issues that might be otherwise ignored due to power dynamics or the potential embarrassment of bringing up a seemingly "obvious" question.
"That was the best meeting we ever had. We fought about nothing and tried to discuss things calmly," said one male member to his newly appointed female colleague after their first board meeting.
But when it came down to decision-making, it wasn't perceived that there was a major change (though the authors note that this might also be a feature of French culture, where boards are more likely to defer to executive recommendations).
For example, though previous research has found evidence that companies with female board members seemed to weather the financial crisis better, in the French case interviewees were reluctant to make a blanket statement that female members were more risk-averse.
Instead, they argued that women were simply more likely to insist on "accurate measurement of risk."
Diversity: Maybe it requires more than a binary model
Indeed, once compiled, the major finding of the interviews is that the impact of female board members might not have been so much about their being women; rather, it could have been all their other distinguishing characteristics.
The authors point out that the newly appointed board members were "more likely to be junior, less likely to come from the Grandes Ecoles elite [university] networks, more likely to be foreign, and more [likely to] have extensive experience in non-traditional areas."
In other words, the pursuit of diversity in experience and expertise as part of fulfilling the new quota might have been a major contributor to the changes seen in boardroom discussions and processes.
Board members suggested that the quota had in fact generated significant substantive differences by adding women, but not because the newly added members were women. Rather, their difference in other regards -- their foreignness, their outsider status relative to the Grandes Ecoles networks, their relative lack of experience and fresh perspective, and their expertise in areas not traditionally represented on boards -- contributed to a board's ability to think outside the box.
This finding implies that, while rough categories like gender or race might be a useful tool to jump-start the process of diversifying opinions and processes, there are a whole lot of other factors that could be just as important, if not more so.
It goes to show that, just like in investing, broad groupings like "stocks and bonds" or "male and female" don't really give you the whole story. If that's the case, then the pursuit of diversity and all of its attendant benefits needs to encompass everything -- background, education, expertise, culture, etc.
Whether civilizing or not, if it leads to better decision-making, America's corporate boards should be all for it.
Anna went to the University of Southern California as an undergrad and encourages her fellow alumni to fight on. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.