| As an institutional investor, Massachusetts’ Pension Reserves Investment Management Board (PRIM), with a $62 billion portfolio, holds voting clout at proxy time. It has a stake in 9,000 boards, though it does not hold a majority position, and hires a firm to count votes on its behalf.
Earlier this month PRIM’s nine-member board, composed of 55 percent white men, unanimously voted to adopt a resolution to either vote against any board nominee if 25 percent of the current board membership is not diverse, or withhold its vote on those nominees.
The move represents a top-down initiative from a broadly-based investor, as contrasted to the decades of bottom-up endeavors by activists of all stripes.
Both top-down and bottom-up perspectives are needed to open up leadership opportunities for women, who now constitute more than 50 percent of the workforce.
Germany recently adopted a quota goal of 30 percent female membership on boards of 114 of the largest companies in its portfolio by 2016, to increase to 50 percent by 2018. Observers say that approach wouldn’t work in the United States, worrying that the strategy might result in the appointment of female candidates who wouldn’t measure up to other basic criteria for board membership.
Board membership at the highest levels has long been a beneficent echo chamber for white men. In complete fairness, as outlined in the article on page 7, it’s easier for any of us to recruit people whose life stations and ability to hit professional marks mirror our own. It’s somewhat like panning for gold – you go through a lot of sand in the pan in order to find the nuggets. And some of the sand you wave on in just to make the weight.
There’s no guarantee that the recruitment of women wouldn’t be vulnerable to the same result. Decades ago, when the Peter Principle gained notoriety, someone said that we’d know that the push for women’s parity had achieved success when women could rise to their level of incompetency at the same rate as men.
Back then, that comment was treated as noir humor and with an existential shrug. But turn it inside out: It’s vitally important for a woman to be able to rise at the same rate as a man.
And there’s another caveat from decades ago. Since the financial collapse of 2008, there’s been increasing attention to valuing women’s consensus-building and sustainability talents, rather than a focus on quick profits. With new regulation that intends to modulate risky and therefore more lucrative ventures, there may be less of an economic power base from which to deal.
In the mid-20th century, as the old municipal and regional political machines were dying out, supplanted by federal Medicare, Medicaid and other social programs, women and minorities started ascending to more mayoral posts in big cities. It was seen at the time as an advance in civil rights. But it came about partly due to the erosion of long-standing local power bases.
The warning for women: Beware of the car you rode in on. If it’s not the Club Car, but instead by Fiat, make sure it can get you where you want to go.
