Call for boardroom shake-ups
Boardroom conformity makes for an easy ride, but it means missing out on the dynamism of dissension, a New York-based venture fund manager says.
Diversity is more than ticking a box, Fahrenheit Wellness Fund managing principal Bridget Liddell said, it's creating a more vibrant environment that clashes and comes up with exciting new proposals.
She is a former director of Sky City and Fisher & Paykel and a former chief executive of Carter Holt Harvey plastics products.
Too many Kiwi boardrooms were filled with older white men, she said, and fresh ideas and new perspectives were needed.
More diverse groups – featuring different backgrounds and ways of thinking – came up with better solutions because they could look at a problem from many different angles, she said.
"Robust debate is more testing for the chairperson and the CEO, but the contention is that the benefit is more than worth the additional tension and pressure and volatility that might come from a more challenging group of people."
Homogenous groups sitting round a table were more likely to have tunnel vision and come up with inferior plans, she said.
Group thinking was the root cause of most problems people encountered, big and small, from Enron and the global financial crisis to a bad company image, she said.
The United States was an example of how too many people thinking the same way could get a country into trouble, she said.
"There's horrifying group think going on, you can only think of lemmings running off a cliff."
By involving young people, more women and more people from other cultures, stronger ideas would be forged in Kiwi boardrooms, making the country's companies more successful, she said.
"We are hard-wired to look to and appoint and listen to people who look like we do, it's a fact of human nature."
Businesspeople had to consciously think about making boards as varied as possible, bringing new skills and ideas to bear, she said.
At the moment, about 9 per cent of top Kiwi company directors were women and only 2 per cent were from different ethnic backgrounds, she said.
Better decision making and more relevance with both customers and potential employees were the offshoots of a diverse boardroom, she said.
Most Kiwi companies did not have diversity particularly high on their agendas, which needed to change, she said.
"We could really think profoundly about what a great mix of our leadership cadre could do for us as a country.
"If we just look a little more carefully about who we're listening to, who we're surrounding ourselves with, where our ideas are coming from ... then we can be more optimistic about our future."
Liddell runs the Fahrenheit Wellness Fund which helps companies that want to enter the United States with marketing and business strategies.
She is especially keen to open the door for Kiwi companies.