Board Diversity is a subject that has come into greater attention due to significant shifts in society and global protests. Many companies have responded to this by increasing the number female and minority directors. However, some companies are moving beyond the boundaries of gender and race by making sure they have cognitive diversity (the variety of skills experience, perspectives and experiences on issues that can improve decision-making).
A diverse board is more efficient than one that is homogeneous. Boards with different backgrounds and abilities are able to solve complex issues in a fresh method and be free of the groupthink that impedes thinking.
Many investors and activists are looking for more diverse boards. Being a part of a board that has different perspectives, experiences and perspectives can assist them in responding to major changes in society more quickly and efficiently for instance, the rapid increase in environmental Governance, Social and Governance (ESG) issues.
Diverse boards are more likely to be cognitively diverse. This means that they can identify issues in their businesses quickly and more effectively. It is easier to tackle these problems when a wide array of perspectives are available and when employees engage in debate and ask tough questions.
A diverse board is no panacea However, it is a good thing. Boards must be able collaborate despite their differences. This requires an executive their website who is able to drive productive discussions and promote collaboration between people with different views and perspectives. Otherwise, it could lead to internal conflict as well as a decrease in productivity.