Reference no: EM133260430
Assignment:
Review the "Should Women Have More Power?" Case Incident 1 on page 464 and respond with answers to the questions using your critical thinking and moral reasoning skills.
Case Incident 1: Should Women Have More Power?
We mentioned in this chapter that women have less power in organizations than men. To demonstrate gender differences in ability, just look at the gender composition of executive boards for top-performing companies. As of 2015, only 18.8 percent of Fortune 1000 company board seats were occupied by women, and only 20.6 percent of board seats were occupied by women at Fortune 500 companies. This disparity not only highlights the discrimination and the glass ceiling that many women face, it may also be bad for business.
We learned that diverse groups might be more creative and innovative, and decision-making is more accurate when a group has a variety of perspectives. This principle appears to be true when it comes to diverse executive boards. A recent review of 140 studies found that having women on an executive board boosted returns, especially in countries with stronger shareholder protections. The same review found that having female board members helped companies' marketplace performance in countries with higher gender equality.
In addition, boards with greater gender diversity are better at monitoring company performance and engage in more strategic involvement. Other research suggests that diverse executive boards are not always beneficial. In most circumstances, having women with greater power on a board led to more strategic change in the organization. However, this is only true when the company is not threatened by low performance.
Many countries are trying to improve their economies by creating quotas that promote more gender-diverse boards. As of 2008, Norway requires women to hold 36 percent of board seats. France passed legislation in 2011 to encourage gender-diverse councils. As a result of the law, 48 percent of new directorships were held by women in 2013.
Questions
1. Why do you think having women with greater power on a board changes firm performance?
2. Do you think using a quota system to promote gender diversity is a good idea? Why or why not?
3. Why do you think some countries have more gender-diverse boards than others?