Does Norway Have it Right?

I’m going to start this by saying I do not like quotas..they make my cringe.  I believe that they are too singular in enforcing a somewhat arbitrary rule.  The market should really be the ultimate say in getting the right people in the right jobs.  By promoting diversity companies promote innovation and as a result, should get better products, more profit, and happier employees and share holders.

That said, I think what Norway is doing is certainly interesting and thought provoking.  Norway instituted a quota requiring that women hold at least 40% of board seats at publicly owned companies (and that men hold at least 40%).

The law was put into place in 2008.  In 2002 boards had only 6% representation, today they have more than 40% (according to the Norwegian Institute for Social Research) and the number of women board members in Norway has doubled.

Here are two good summary stories:

Boardroom Revolution by Time and To Quota or Not to Quota by JUMP

Reading these articles makes me think about diversity quotas in the US.  Many are not mandatory, but I do know that companies push for certain levels of gender diversity and cultural diversity across teams.  It is always a sore point of conversation with many of the men I work with.  They believe it is unfair to give an advantage because of gender.  I agree.  However, I think of the voluntary quotas or “expectations” as more of a foot in the door.  In my own experience, the expectations help ensure that you start with a diverse pool of candidates.  It rarely means that the best person for the job is not chosen.  That is certainly the way I believe it should work too.

I wonder if this Norway quota will eventually have the impact that Title IX did here in the US.  (Title IX is a law enacted in 1972 that reads: ” No person in the United States shall, on the basis of sex, be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any education program or activity receiving Federal financial assistance”  It is most known for its impact in women’s sports, but it has played a key role getting women into engineering too.  I think the law has overall had a very positive impact and made a large difference in the past 30+ years.  If you polled young women today, none of them would think twice about not having a women’s basketball team, soccer team, or girls in technology classes.

Perhaps it’ll take Norway another decade before we can really look at the results and draw some conclusions.  The early ones show that there are certainly more women on boards.  But it did not change the number of women CEOs or women in executive committees.   Sixty percent of male board members questioned for the research said there had been “no major changes to board operations” since the law took effect, but that they had seen some improvements: “more discussions” and “new perspectives”.  Those last few quotes seem to highlight that the presence of these women has not been enough to raise company profits and prove that having them is a huge market advantage. Then again, the world works at a glacier pace sometimes…It may take another decade to see the difference.


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2 responses to this post.

  1. Posted by Kiki on January 19, 2011 at 4:36 pm

    There was a quote by Martin Luther King Jr. that said something along the lines of ‘The law can’t change someones heart but it can change there actions.’ That’s not the exact quote, but it did make me think. Sometimes the advantage of these rules is that even though people are resistant to change at first, seeing people become more than the idea in there head can really change peoples minds.

    I’m inclined to believe that more women in the board room will lead to more female CEO’s because of the opportunities it creates for qualified individuals that weren’t as accessible to those qualified individuals.

    And I don’t think the new opportunities created are unfair, I think that the lack of opportunity is unfair. 6% does not seem like a realistic representation of the ratio of potential qualified female board members. Statistically, the few females that made it in the board room would be outliers.

    Reply

  2. Posted by magoodma on January 19, 2011 at 6:56 pm

    I agree, maybe this is just what is needed to instigate the change. Interestingly no other countries have really stepped up to do the same thing. Maybe they are all just waiting to see how this one pans out.

    Reply

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