Women improve boards, but still not enough women are in top management in Denmark

There are not enough women in top management and boards.

Among large businesses in Denmark, only one in five board members is a woman, while women make up no more than 16% of board members in small and medium-sized enterprises.

This is despite the fact that all of our neighbouring countries, Norway, Sweden and Finland, have much more gender equal boards. By way of example, women on average make up 41% of board members in Norway. 

In recent years we have, however, witnessed a greater awareness of this problem, which is a good thing, not just for gender equality in society at large, but also for the boards themselves, according to Marie Louise Mors, Professor at the Department of Strategy and Innovation at Copenhagen Business School, where, among other things, she conducts research on board dynamics and what happens when more women serve on boards. 

Alongside her colleague, Margarethe Wiersema, Professor of Strategy at University of California, Irvine, she has studied what happens to board dynamics when more women serve. 

Their findings are published in the scientific Journal of Management. 

Women create an open atmosphere

In a number of qualitative interviews, Marie Louise Mors and Margarethe Wiersema have asked board members in Denmark, across Europe and the US about their experiences with women serving on boards. And they are very positive.

“The women are truly engaged. They are very well-prepared, they have a lot of questions at meetings, they display a great degree of responsibility and they make sure that the company adheres to the rules."

- Marie Louise Mors, professor, CBS

"In short: they do a really great job,” she says.

The respondents also say that women have a positive influence on their male colleagues, and that their presence changes the dynamics of the boards they serve on. 

“Less politics, a more relaxed atmosphere. Men become less preoccupied with nursing their ego and showing off. Women are not as concerned about what others may thing and they ask questions if there’s something they don’t know and would like to understand. This affects the dynamics and allows for a greater openness for everyone on the board, and it makes others share more opinions and perspectives,” Marie Louise Mors explains.

Root out pluralistic ignorance

When many people who look the same have to decide on something collectively, they will often rapidly reach common ground, and decisions are quickly made. 

It sounds efficient and easy. But it also enhances the risk of overlooking potentially important perspectives because they are not discussed sufficiently, and this may lead to bad decisions based on incomplete information. 

In social sciences, this phenomenon is termed pluralistic ignorance.

“When all of us in a group look the same, we’re less prone to express our concerns, because we believe that everyone else is in agreement and that we’re alone in being concerned. We don’t want to say anything that sticks out. Which is why decisions are quickly made within a homogeneous group, but that does not necessarily make them good decisions,” Marie Louise Mors elaborates.

The more diverse a group is, the lower the risk of pluralistic ignorance becomes.

“When someone joins a group and acts differently, questioning things that appear wrong, it will affect the others and allow them to step forward and voice their concerns.”

- Marie Louise Mors, professor, CBS.

Many previous studies of women’s conduct in businesses tell a stereotypical tale about women who adapt, who are careful and who do not question how things are done. However, that narrative does not correspond with what Marie Louise Mors sees in her study. 

“In our study, women happily speak their mind. The contrast in terms of previous studies may be due to the fact that those studies examine women who are employed at lower hierarchical levels. There may be a selection-effect, as the women who reach board level may behave differently. It might also be due to the fact that boards are a different kind of team. Whatever the reason, we need more studies on top level management.”

More barriers for women

Once women join a board, they have a positive influence on the work carried out. So, why are there still so few women board members in Denmark?

“I was also quite surprised when I began my research on this area. I didn’t think that gender equality in top management was a problem in Denmark. In addition to the board members we interviewed, we asked headhunters, among others, whether there are specific barriers for women. And there are,” Marie Louise recounts. 

Among other things, women’s CVs are looked at more critically than men’s. Typically, more is required of women. By way of example, it is preferable if women have previous experience in positions such as managing director or CFO. More emphasis is also placed on women’s clothing, body language and what they say in an interview, according to Marie Louise Mors. 

“Which leads to the next question: why do we demand more of women? One explanation is that many men serve on boards and they pick people who look like themselves. Boards used to be a closed network of white men, who utilised their personal networks to find new members. In that regard, we simply have to look wider. However, it is also due to the fact that historically, men have been employed in management positions, and therefore, we find it difficult to imagine women in the role as leader.”

Demands for gender equality professionalises recruitment   

In order to break down the barriers, it is important to shed more light on the problem and put more pressure on businesses to hire women as board members, Marie Louise Mors explains. 

“I’m frequently told that if we push for more gender equality, it will lead to women being picked because of their gender, but that’s not what my research shows. Companies look for qualified and competent women. We see it in countries with formal requirements in terms of gender equality on boards; they look outside their personal networks. They approach recruitment companies and collaborate on how to get more women on the lists.”

In fact, recruitment often becomes more professionalised when there are demands for greater diversity, she elaborates. 

“There is a much greater focus on skills. Boards look at which skill sets are already represented in the room, and then they agree on finding a woman who has the required skill set. This leads to a more diverse board, not only in terms of gender, but also in terms of skills, experience and education. This then leads to a lift in the board constellation, as it is no longer a homogeneous group.”

Legislation in Denmark is “soft”

We turn back to the situation in Denmark. Why are we lacking behind our Nordic neighbours and what can we do to push things forward?  

First of all, Denmark has what is termed “soft” legislation in this area. Since 2013, big businesses have been required to report their targets and strategies for enhancing diversity. 

But there are no legal consequences should they fail to fulfil their goals. Since 2003, it has been a legal requirement in Norway that women on boards should make up at least 40 per cent – in other words, they have a quota system. 

“In Denmark, there is a lot more pressure now, but Danish politicians are still undecided on how to enhance gender equality on boards.”

And if you ask Marie Louise Mors what the answer is, she will say: awareness. 

“When I first began researching diversity in management, the gender equality discourse received a lot of negative media attention. Today, however, there are many big companies who openly talk about a need for greater diversity and that we’re falling behind in Denmark.”

It helps when big companies talk about it. 

“It also helps when media and journalists write about it more. Both in terms of telling companies who don’t focus on diversity off, but also in terms of giving those who actually do something positive coverage. So, something is happening,” she concludes. 

Contact:

Professor, Marie Louise Mors,  lm.si@cbs.dk

Journalist Asbjørn Sørensen, aso@slk@cbs.dk