17 Feb 2021

Women in boardrooms stand out from the average

Female directors diverge from the boardroom practices of their male counterparts, but also from typical traits attributed to women, illustrates financial economist Renée B. Adams in a SAFE Policy Web Seminar

It is generally assumed that women care more about others than men. On average, this is true. However, when we enter corporate boardrooms, the picture changes: female directors are not only significantly more power-oriented than women in the average population, but also more power-oriented than men in the boardroom, Renée B. Adams noted in a SAFE Policy Web Seminar.

The Professor of Finance at Saïd Business School of the University of Oxford also explained how this observation should be interpreted in the context of current trends in corporate governance. During the SAFE Policy Seminar, Adams made it clear that a lot of stereotyping prevails in the debate about female executives, which hardly stands up to scrutiny.

Regarding current developments in the field of corporate governance, the economist firstly emphasized that an increase in boardroom gender diversity is observable. Secondly, environment social governance and corporate social responsibility are becoming increasingly important for companies. At the same time, there is a widespread perception in society that women are more caring towards others than men which in the general perception suggests that more women in corporate leadership must mean: "If you care about others, you care about a company's stakeholders." But this assumption does not correspond to reality, Adams argued.

Two different debates

"Women on boards are not the same women compared to the average population," she emphasized. In addition to differences in power orientation between female corporate boards, the average female population and male boards, there are significant gender differences in stakeholder/shareholder orientation in international comparisons.

According to her own research, female boards in the U.S., U.K. and Australia, for example, tend to be more shareholder-oriented, while Spain, Ireland and Sweden show a stakeholder orientation. "The reason for this is that both values and selection processes vary from country to country," Adams explained. In addition, within countries, board nomination and selection processes would change over time, which may also be politically motivated.

Against this backdrop, it is a stereotype to equate female corporate board members with corporate social responsibility. "We are talking about two pairs of shoes here," Adams stressed. The debate about women on boards is different from the debate about more gender equality. The latter is really a discussion about human rights. "Women don't have to and shouldn't have to justify their place at the table," the financial economist said.


Watch the full length video of the SAFE Policy Web Seminar