Thursday, December 7, 2017

Will More Women on Boards Change Corporate Culture and Stem the Tide of Harassment Complaints?

Two weeks ago, I asked whether companies were wasting time on harassment training given the flood of accusations, resignations, and terminations over the past few weeks. Having served as a defense lawyer on these kinds of claims and conducted hundreds of trainings, I know that most men generally know right from wrong before the training (and some still do wrong). I also know that in many cases, people look the other way when they see or hear about the complaints, particularly if the accused is a superstar or highly ranked employee. Although most men do not have the power and connections to develop an alleged Harvey Weinstein-type "complicity machine" to manage payoffs and silence accusers, some members of management play a similar role when they ignore complaints or rumors of inappropriate or illegal behavior. 

The head in the sand attitude that executives and board members have displayed in the Weinstein matter has led to a lawsuit arguing that Disney knew or should have known of Weinstein's behavior. We may see more of these lawsuits now that women have less fear of speaking out and Time honored the "Silence Breakers" as the Person of the Year. As I read the Time  article and watched some of the "silence breakers" on television, it reminded me of 2002, when Time honored "The Whistleblowers." Those whistleblowers caused Congress to enact sweeping new protection under Sarbanes-Oxley.  Because of all of the publicity, companies around the country are now working with lawyers and human resources experts to review and revamp their antiharassment training and complaint mechanisms. As a result, we will likely see a spike in internal and external complaints. But do we need more than lawsuits? Would more women in the boardroom and the C-Suite make a difference in corporate culture in general and thereby lead to more gender equity?

Last week, Vĕra Jourová, the EU Commissioner for Justice and Gender Equality put forth some proposals to redress the gender pay gap in Member States’ businesses. She recommends an increase in the number of women on boards for companies whose non-executive Boards are more than 60% male. These companies would be required to “prioritize” women when candidates of “equal merit” are being considered for a position. Germany, Sweden, and the Netherlands have already previously rejected a similar proposal.

I'm generally not in favor of quotas because I think they produce a backlash. However, I know that many companies here and abroad will start to recruit more female directors and executives in an effort to appear on top of this issue. Will it work? We will soon see. After pressure from institutional investors such as BlackRock and State Street to increase diversity, women and minorities surpassed 50% of  S & P open board seats in 2017. Stay tuned. 

 

http://lawprofessors.typepad.com/business_law/2017/12/will-more-women-on-boards-change-corporate-culture-and-stem-the-tide-of-harassment-complaints.html

Compliance, Corporate Governance, CSR, Current Affairs, Employment Law, Ethics, Marcia Narine Weldon, Shareholders | Permalink

Comments

An interesting, provocative topic. I’m old enough to have observed the 70’s equal rights movement. As women chose to break stereotypes and adopted male behaviors and vices, they started suffering from what had previously been predominately male afflictions. Once an almost exclusive province of males (whether occurrence may be simply a matter of increased coverage) the media regularly reports females (anecdotal from my perspective) engaging in predatory behaviors including statutory rape of minor males (which might be accounted for only because parent’s sensibilities have changed and the veil pierced as a result of our electronic world).

I think (and that really means little) that the increased number of women on boards might change the politi-speak of organizations; but, I increasingly view these behaviors by either sex as accompanied by the character of the individual and their desire for power.

Although I am not of a “litigation first and foremost,” I truly believe that punitive financial costs will have far more effect on any board to “police and enforce” a workplace lessening the risk of sexual harassment.

Posted by: Tom N | Dec 7, 2017 3:11:28 PM

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