We know that getting more women on teams can boost performance.
The examples are numerous: Citing private internal research of 20,000 client teams, EY's vice chair Beth Brooke has said that the more diverse teams had higher profitability and great client satisfaction than non-diverse teams. And professors Anita Woolley and Thomas W. Malone have learned that increasing the number of women on a team also increases its collective intelligence.
Yet when it comes to one of the most important "teams" a company has — its board of directors — the United States seems to have hit a ceiling of about 16% women, with little by way of national efforts by government or business to increase that number. Whether one agrees with quotas as a mechanism for an increase or not (spoiler: men are less likely to), a new look at Norway, which has a mandatory quota system of 40%, is helpful in understanding why having at least three women on a board is important.
And while research about financial performance is still in its infancy — Catalyst has found a strong correlationbetween the number of women on boards and in the C-Suite and ROI and ROE of company returns — we're starting to learn more about the important ways women are changing the inner workings of boards. Taken together, Professor Dhir identified seven consequences of gender-based heterogeneity for boardroom work, board governance, and group dynamics: Enhanced dialogueBetter decision making, including the value of dissentMore effective risk mitigation and crisis management, and a better balance between risk-welcoming and risk aversion behaviorHigher quality monitoring of and guidance to managementPositive changes to the boardroom environment and cultureMore orderly and systematic board workPositive changes in the behavior of men.
This doesn't mean there weren't challenges. Some included more prolonged decision-making, less initial bonding, and additional conflicts due to the increase in different perspectives.