6.2.3 Companies’ justifications for having women on their boards and assessment of certain aspects of companies’ diversity policies

Chapter 4 examines how Dutch companies apply the concepts of gender equality and gender diversity in practice by adopting organizational interventions. In Chapter 4, the following research question is answered:

How have Dutch companies applied the concepts of gender equality and gender diversity in practice, and which organizational interventions have they implemented?

This research question is operationalized by the following research question that was analyzed and answered in Chapter 4:

How do Dutch listed companies behave in regard of the two themes, board diversity and gender equality, thereby discussing the (mix-up in the) application of the Dutch (semi-) legal norms in this area?

The chapter first elaborates on the various theories and justifications for companies to strive for women on corporate boards, based on the economic perspective (business case) and the rights-based perspective (human rights). The second part of the research analyzes the results of two empirical studies that were conducted by Nyenrode Business Universiteit on behalf of the Monitoring Committee Corporate Governance. The Monitoring Committee Corporate Governance asked Nyenrode to investigate whether, and to what extent, Dutch listed companies comply with the provisions of the Code. Two empirical studies were conducted regarding compliance with the Code. The first study was conducted in 2015 for the financial year of 2013. The second study was conducted in 2016 for the financial year of 2014. Data was collected by means of a questionnaire that was sent to all Dutch listed companies.1 The companies were asked to fill out the questionnaire in which they had to indicate whether they complied with the Code (self-assessment). The questionnaire was completed by 72 companies for the study concerning the financial year of 2013 and by 75 companies for the study concerning the financial year of 2014.

Part of the questionnaire was dedicated to specific topics including, among others, gender diversity on corporate boards (i.e., management and supervisory boards) of the companies.2 Chapter 4 elaborates on the topic of gender diversity and describes the findings of the study. The first empirical study included questions pertaining to the companies’ diversity policies and asked whether the Dutch listed companies had set diversity goals, whether these goals had been achieved and whether the company had provided any explanation for not meeting the goals. The second empirical study for the financial year of 2014 focused on the ‘measures’3 (from now on the term interventions will be used for consistency purposes) that these companies had implemented to meet the diversity goals set out in their diversity policies, the results of the interventions and whether these interventions were perceived as being effective for increasing the number of women on the respondents’ corporate boards.

The findings of the second empirical study for the financial year of 2014 are particularly relevant for this PhD research because they identify the organizational interventions that were implemented by Dutch listed companies. The findings of the study identified 171 organizational interventions. These 171 organizational interventions were categorized into eight categories. Of these identified interventions, 110 interventions were considered useful for the research; 61 of the responses were either too vague to be useful or the question was not answered at all. The findings show that the intervention that was identified the most was the implementation of specific diversity policies and goals. This intervention was also perceived by the companies to work best in increasing the number of women on corporate boards.

With reference to the business case perspective and the rights-based perspective, it was noted that the Code mainly refers to business case arguments. However, Dutch listed companies often use human rights arguments to justify why women should be on corporate boards. They do so by referring to the Dutch target figure that was in place at the time of the research. This chapter claims, however, that both justifications should be used. It is also claimed that if companies wish to comply fully with human rights legislation, they should aim for a gender balance of 50-50 percent (gender equality for both women and men) instead of the gender balance of 30 percent prescribed by the target figure.

This study contributes to the research question about organizational interventions to achieve gender equality at the corporate top of companies, and in particular on corporate boards. This research was a first inventory of the organizational interventions that have been implemented by Dutch listed companies. As noted in Chapter 4, the companies were not always very specific in their answers and quite a few of the answers were vague, or the question was not answered at all. Therefore, it is hard to draw conclusions from the research. However, this study was only an exploratory study which lays the foundation for further research. Additional research is, therefore, required to gain more information about the interventions that are implemented in Dutch companies and to understand better how these interventions work in practice.