The year is 2017. Following the tenure of the United States’ first black president, as well as the first woman presidential candidate, some may be under the impression that the plight of minorities and women in leadership is coming to a close. The numbers, however, tell a less rosy story. Last year, white men held more than two-thirds of board seats for Fortune 500 companies, while minorities and women held a combined 31 percent of board positions, according to a study conducted by the Alliance for Board Diversity and Deloitte. And in March 2016, S&P Global Market Intelligence reported that 24 Fortune 500 companies’ boards, including Caesars Entertainment Corporation, lacked women completely—a situation that actually worsened from 2015. But the hospitality industry continues to push forward, attempting to reflect the diverse population it sees walk in and out of hotel lobbies every day.
But for many hoteliers, a diverse applicant pool can be hard to come by organically. Key to solving this issue is working with talent firms that specifically seek a wide range of applicants who may not get their feet in the door otherwise. Ferguson Partners specializes in refreshing existing boards and building boards from scratch. Radhika Papandreou, Ferguson Partners’ Chicago-based senior director and restaurant and leisure practice leader, works with three practices within the firm that commonly intersect: the Hospitality, Diversity, and Board practices. “Men are offered board seats primarily through their natural network, while women will get an opportunity to serve on a board primarily through a director search conducted by a search firm. I think companies struggle because they don’t have the talent that they need in their natural network,” she explains.
So whenever a client comes to her looking for guidance on selecting board members, she repeats the same suggestion.
“‘Here is your chance: You have a number of director seats to fill. Let’s think about not only the diversity of background and skill set, but the diversity of culture, race, and gender, as well,’” she explains. “‘This is your opportunity to create a diverse board.’”
When building a board, Ferguson Partners puts a diversity lens on its search for the right candidates.
“A lot of boards will come to us and say, ‘We have an all male board and we are a public company. We know that we will enhance our performance if we have some diversity. Can you help us include a strong slate of diversity candidates?’” Papandreou says encouraging clients to consider a diverse group of individuals for board seats is a fairly easy sell. When asked how she pitches the diversity angle, she says, “Beside that it is the right thing to do?” But the numbers go beyond a personal or professional conviction.
“If you look at studies going back over the last 10 to 15 years, you will find that companies with diverse boards perform better relative to non-diverse boards. There is less group think, and a broader range of viewpoints in the boardroom allow board members to challenge each other a bit more,” she explains. “In the hospitality industry, you have a very diverse group of people purchasing your service. So, you want a diverse group of people thinking about how to sell it.”