board diversity

Five steps to recruiting a diverse board

The idea that diversity is an add-on to core business has been debunked.

The business case for diverse boards is compelling and substantial. Boardroom diversity is proven to be far from a ‘nice thing’ driven by feminism, equality and fairness (though it is that too), but a key component in equipping companies to successfully navigate today’s fast-changing operating environment.

Numerous research studies have found that diverse boards correlate with better business performance. This is true of gender diversity and ethnic diversity. Firms listed in the FTSE indices are hearing this message, albeit slowly: over 40% of NEDs in the FTSE 350 are female (FTSE Women Leaders Review, 2024); Ethnic minorities currently hold 19% of director positions on FTSE 100 boards (Parker Review, 2024).

Here, we provide some suggestions on how to effectively recruit a diverse board. Our recommendations are grounded in research and are highly practical, drawing from our experience and the successes of companies currently reaping the rewards.

Step one – getting everyone on board

The first stage to turning on the floodlights to new boardroom talent is to ensure there is a consensus on your board or nominations committee that this approach will be beneficial or, at least, acceptable. It has been established that diverse boards are a genuine business need, and recruiting for diversity requires a shift in approach. Given the value of an effective board to organisational effectiveness and resilience, any additional care taken over the selection of NEDs should generate a strong return on investment.

If you need convincing, refer to our ‘Making the case for diverse boards‘ for research and evidence.

Step two – refine your requirements

If you keep asking the same question, you’ll keep getting the same answer.

Slim down your recruitment briefs to the must-haves for the new board member, which, in reality, comes down to 2 or 3 areas of experience that no one else on the board can provide. Gathering people from various backgrounds can also bring benefits in adding a different perspective to your board discussions. There is also a tendency to prejudge the career history required to develop the skills your board needs. Yet, a professional can gain relevant expertise in several different contexts.

Step three – remove the potential for unconscious bias

Blind auditions for orchestras have increased the probability of women advancing by 50%. Considerations such as ‘cultural fit’ with the organisation can lead to selection in the image of current successful post-holders if not interpreted with care.

Anonymising applications in the early selection steps can remove potential unconscious bias, as initial evaluation should focus purely on skills and experience. Scoring candidates against core requirements ensures a skills focus and gives a framework to question and justify your selection as a panel, resulting in more robust choices.

Step four – widen your candidate pool

Many boards still recruit their non-executives through networks alone. This gives greater security because you know the person (directly or by proxy through a trusted connection). However, this may lead to settling for the first ‘good enough’ candidate and increase the risk of shared blind spots and groupthink. Instead, advertise your role openly and transparently and emphasise diversity to your headhunter.

Being open and transparent about your search ensures a strong pool of candidates and can increase your customers and staff’s confidence in a successful appointment.

Step five – consider your interview process

To ensure a fair hiring process for a non-executive board member, consider standardising your interview questions and ensuring that interviewers collectively understand the board’s needs. Considering the diversity of people who are interviewing is an obvious issue. Whilst interviewees mustn’t feel like the ‘odd one out’, simply bringing in one ‘diverse’ team member has been shown to have minimal impact on hiring decisions.

It is important to balance the relative strengths and weaknesses of each candidate and avoid overstuffing the board with one type of experience. Look for candidates who can bring diverse expertise and fill in any weaker areas to benefit the board.

Building a diverse board is a matter of equality and fairness and a strategic move that can enhance your company’s performance and effectiveness. By following these five steps, you can ensure that your boardroom is equipped with a variety of perspectives and experiences that can help your company navigate today’s fast-changing business landscape successfully.