WCW's Women Change Worlds Blog

The last few years have brought vastly increased attention to issues of diversity, equity, and inclusion in the media and within countless companies and nonprofits. This is particularly true in higher education and healthcare institutions (eds and meds)—the largest and most influential nonprofits. Though such attention should have included increasing the diversity of governing boards, which have ultimate responsibility for decisions that impact a diverse population of stakeholders, many boards have not examined their own diversity deficits and taken steps to remedy them. And if these eds and meds boards think no one knows or cares about their makeup, they will have little or no incentive to change.

The organization I chair—Women’s Nonprofit Leadership Initiative—believes that stakeholders like us (whether we are donors, staff members, students, alumni/ae, patients and their families, or members of surrounding communities) ought to care about diversifying the demographic makeup of these boards and ought to exercise our influence to propel change. Just as investors—particularly institutional investors—have demonstrated their concern about for-profit boards that lack diversity and have found ways to hold those organizations accountable, stakeholders in the nonprofit sector need to do likewise. There is, however, a major obstacle to doing this. If you are interested in learning whether your alma mater or health care system has a diverse board, you are likely to find it is hard to get the data.

As someone who has been involved in researching both nonprofit and for-profit board diversity since 2005, I know how difficult it is to secure reliable data. In a 2020 Women Change Worlds blog post, I wrote about Increasing Gender Diversity on the Boards of Nonprofit Eds and Meds: Why and How to Do It, a national report I co-authored and WNLI co-published. In 2019 WNLI partnered with La Salle University’s Nonprofit Center in publishing a report on the Philadelphia area’s largest eds and meds that showed the underrepresentation of women, particularly women of color, on these boards. In early November 2022, our two organizations published a new report, Closing the Gaps: Gender and Race in Nonprofit Boardrooms. The report found that some progress has been made, but that gender and racial gaps still exist in too many boardrooms, and board chairs are still predominantly white males.

But one of our major findings was not about diversity itself. It was about how hard it is to get accurate data about the composition of these boards. Though some institutions have photos and biographical information on their websites, many list only the names of trustees. A few provide no information at all. None of those in our study provide data on overall board demographics. When we sent a request to the 46 eds and meds to provide us with data on how board members in the aggregate self-identify by gender and race/ethnicity, only seven immediately sent us their data. A second request to confirm/verify or correct data we had gathered from public sources produced some response, but it took follow-up calls and great persistence to ultimately reach a 72 percent response rate. There were 13 eds and meds from which we were unable to get responses. So good luck to the individual who wants such information about a particular college/university or hospital.

Institutions of all types have increasingly faced pressure to be more transparent in general. Last August, the U.S. Securities and Exchange Commission approved a requirement that for-profit companies listed on the Nasdaq stock exchange disclose board diversity statistics annually using a board diversity matrix. Nonprofits could and should do the same.

At an inspiring December 2022 program featuring Wellesley President Paula Johnson interviewing former Australian Prime Minister Julia Gillard (both passionate proponents of women’s leadership), Johnson emphasized that making change happen requires data. As she said, “You don’t change what you don’t know.”

WNLI is continuing to explore ways to require nonprofits to disclose their demographic makeup, as they are required to disclose a great deal of information about their finances and operations to the public. All of us need to be able to learn about the demographic makeup of nonprofit as well as for-profit boards so that we can use our influence individually and as groups of stakeholders to propel change.

Vicki W. Kramer, Ph.D., Wellesley ’61, is chair of Women’s Nonprofit Leadership Initiative, which was founded by classmate Happy Fernandez. Dotty Hindels Brown, Wellesley ’67, is an active member. Kramer is lead author of Critical Mass on Corporate Boards: Why Three or More Women Enhance Governance, published by WCW, and has co-authored numerous articles in such publications as Trusteeship Magazine, The Chronicle of Philanthropy, and the Harvard Business Review, and a chapter in More Women on Boards: An International Perspective.

Hospitals and universities are facing challenges that many have never seen before as they respond to COVID-19. Universities are closing their campuses and transitioning to remote learning in order to protect the health of their faculty and students. Hospitals are working around the clock to add more beds, secure lifesaving equipment, and acquire the gear needed to protect their staff. These educational and healthcare organizations ("eds" and "meds") need to identify creative solutions to solve these problems in ways that take into account the needs of their diverse stakeholders. Boardroom diversity is particularly important to achieving this.

Almost 14 years ago, the Wellesley Centers for Women published Critical Mass on Corporate Boards: Why Three or More Women Enhance Governance. I wrote this report along with my coauthors Alison M. Konrad, Ph.D., and Sumru Erkut, Ph.D. At the time, we didn’t know how much of an influence it would have on corporate boards. Since then, the biggest for-profit corporations have faced increasing pressure to diversify their boards from major shareholders, advocacy groups, some government entities, and the media.

The largest nonprofits—eds and meds—have not faced comparable scrutiny or pressure. But recent studies in Philadelphia and Boston, two major centers for eds and meds, have begun to shine a light on the low percentages of women on the boards of many of these institutions.

As a member of the Women’s Nonprofit Leadership Initiative (WNLI)—which was founded by my Wellesley College classmate, Happy Fernandez ’61, and is a co-publisher of the Philadelphia report—I learned of the need for research to understand the reasons behind the numbers and what remedies work. So WNLI colleague Carolyn Adams and I conducted in-depth, confidential interviews with 59 female ed and med board members and male and female board chairs and chief executives in 14 states and the District of Columbia, representing every region of the United States. We wanted to know what it’s like to be in “the room where it happens.”

In our new report, Increasing Gender Diversity on the Boards of Nonprofit Eds and Meds: Why and How to Do It, we document that women face substantial barriers to gaining board seats and to serving effectively once elected. Though our study focused on gender diversity, we found parallel barriers to racial diversity and note the impact of the combined barriers of gender and race for women of color.

Removing obstacles for all women matters, not only because equity in organizations must start at the top, but also because our interviewees reported that female directors have positive impacts on the boards and their significant decisions. Women make contributions related to their expertise, as do men, but they also bring different experiences and perspectives to the table, particularly on issues involving consumers (students and patients), culture change, improved governance, and the way decisions are made. An overwhelming number of interviewees believe board diversity can increase effectiveness in serving consumers.

Though these nonprofit boards present some of the same barriers to gender diversity as for-profits, women face additional barriers in nonprofits related to differences between the sectors:

• FINANCIAL REQUIREMENTS: Unlike for-profit boards, where members are paid a stipend, nonprofits generally expect board members to make financial contributions, sometimes sizeable. That can work to exclude or reduce the numbers of women who are considered.
• WHO-YOU-KNOW RECRUITMENT: Unlike for-profits, which regularly use search firms, nonprofits rely primarily on board members to recruit new members and are therefore limited by the largely white male social and business circles of the current white male trustees.
• BOARD SIZE: Nonprofit boards are usually larger than corporate boards, which average 9 to 11 members. In our study, excluding one board with over 85 members, the average board size was 29, and some had over 60 members. Though our 2006 WCW study led the way in pointing to a critical mass of three or more women in order to have an impact on for-profit boards, our nonprofit respondents cited 30% as the relevant minimum on their boards, because of their greater size. Even a critical mass does not necessarily lead to inclusion on large boards, where committees do the real work and executive committees often make most decisions. Exclusion from such power positions, or appointments only in small numbers, can mute women’s voices and limit their opportunity to be of influence and value.

The differences we identified call for change strategies tailored to the nonprofit sector. The strategies we recommend include:

• Placing less emphasis on a candidate’s financial capacity to contribute.
• Changing recruiting practices.
• Shrinking board size.
• Creating separate fundraising boards.

Embracing change, we found, requires leadership, intentionality, and a full board discussion of diversity.

In the United States, pressure on for-profits has largely come from shareholders. Nonprofit eds and meds do not have shareholders but they do have stakeholders: students and patients and their families, alumni/ae, employees (particularly faculty in the eds), members of communities affected by major board decisions, and donors. Since we are all members of some of these groups, if we, as stakeholders, paid greater attention to the lack of diversity on these boards and organized to exert our influence, we could propel change—putting eds and meds in a better position to face future challenges.

Vicki W. Kramer, Ph.D., is a consultant to nonprofits and former academic. She has co-authored articles in the Harvard Business Review and numerous other journals, as well as chapters in Women on Corporate Boards of Directors: International Research and Practice and More Women on Boards: An International Perspective. She was the founding president of the Thirty Percent Coalition, a national collaboration of for-profit companies, institutional investors, and nonprofits promoting gender diversity on corporate boards.

 In a meeting with the Congressional Black Caucus earlier in October, Facebook’s Chief Operating Officer, Sheryl Sandberg, made a public commitment to appoint an African American to its currently all-white board of directors – in the foreseeable future.

The promise came when members of the Congressional Black Caucus were questioning Sandberg about the lack of diversity on Facebook’s board and at all levels of employment at Facebook where only three percent of employees are African Americans, and there are no black executives. Lawmakers confronted Sandberg about Facebook advertising that has been linked to Russian accounts purchased during the 2016 election that were connected to Black Lives Matter. Members of the Congressional Black Caucus said that if more blacks were in decision making positions, the connection with Russian accounts and anti-Black Lives Matter content may have been caught before the FBI looked into the issue.

But is one African American board member going to be able to bring a loud enough voice to change the status quo on the board and also move the company toward greater diversity in its rank and file? Drawing on our research on how many women it takes to change corporate board dynamics we conclude that a lone member of an underrepresented group is unlikely to be an effective voice for change.

My colleagues Vicki Kramer, Allison Konrad, and I interviewed 50 women directors, 12 CEOs (nine male), and seven corporate secretaries at Fortune 1000 companies. We found that the benefits of having women on a corporate board are more likely to be realized when three or more women serve on a board.

While even one woman can make a positive contribution, more typically, the token minority person is simultaneously invisible as a peer who can contribute and hyper-visible for being different from the majority, with irrelevant aspects of their demographic difference overshadowing their professional skills. We heard examples of lone women directors being talked over and otherwise ignored when they responded to a strategy question but asked about their preference for home decorating. In other words, being a token tends to be a powerless position.

Having two people different from the majority is generally an improvement over the token position. But it is corporations with three or more different people on their boards that tend to benefit the most from the diverse perspectives they can bring. Our results showed that with three or more women, board discussions expanded to include the interests of multiple stakeholders, including the community and to pursue answers to difficult questions such as CEO compensation and diversity. Three or more women were also able to change board dynamics toward a more collaborative approach to leadership, improving communication among directors and between the board and management.

Important to note is that Facebook’s board is currently comprised of eight individuals—six white men and two white women—and two of these individual are the inside directors, Mark Zuckerberg and Sheryl Sandberg. This elite structure reflects the lack of a wider perspective of viewpoints, experiences, concerns, priorities, and sensitivities. While this may have helped the organization’s growth, there are corporate responsibilities beyond the bottom line.

If Facebook is serious about its diversity problem, adding one African American to its board is not going to be enough. It takes a critical mass of three or more people who are different from the majority to bring about change on a board.

Sumru Erkut, Ph.D., is senior research scientist at the Wellesley Centers for Women at Wellesley College. Her research interests include women’s leadership, racial/cultural norms and identity in youth and families, and adolescent development.