Increasing representation of women on private sector boards in Scotland

4. Approaches to Improving Gender Balance and Broader Diversity of Boards

Introduction

Achieving equality and diversity is important given that research ^[11] has found that there are significant business benefits from equality and diversity - including lower labour turnover, higher levels of commitment and motivation amongst employees, improved reputation (amongst customers and potential employees), better understanding of customer needs and more flexibility and creativity within the business from the increased range of perspectives, skills and capabilities.All of these are critical in helping businesses achieving their growth potential.Within the broad issue of diversity and equality, a key issue is securing greater diversity in board membership - with a particular focus here on securing greater gender equality in board representation. Research commissioned by the Scottish Government ^[12] has found that the key steps needed to improve the diversity of board membership included:

• Increasing awareness on the role of boards has the potential to broaden the pool of potential candidates applying for available posts. Greater transparency is needed with vacancies advertised more widely.
• Existing and potential board members should be able to access a range of training, mentoring and networking opportunities.These interventions are seen as particularly important in relation to female board members as they provide legitimacy and help them form alliances with existing board members.
• Setting targets for gender diversity and monitoring compliance will help ensure increasing diversity is prioritised.
• In this chapter, we will examine the approaches taken by Scottish companies that participated in this research, setting these in the context of the broader literature on this subject. The chapter will start by examining the different policy approaches open to governments.It will then examine the approaches taken by company participants, including any external supports they have accessed.It will conclude by examining the support companies and stakeholders would like Scottish Government to provide to help tackle this issue.

Policy Approaches

Individual companies can take specific actions to obtain gender balance and broader diversity on boards. These are reviewed towards the end of the chapter, but first we look in broad terms at three distinct policy approaches adopted to achieve gender balance on boards (Vinnicombe et al., 2015) which are identified in the literature.The first two highlight a clear divide between 'quotas' and 'voluntary targets' (Casey, Skibnes and Pringle, 2011, p 618) and the third relates to corporate transparency .

Quotas

Globally more than 20 countries have set quotas for the number of women on corporate boards, with research undertaken by Grant Thornton (2015) showing that just under half of business leaders would support the introduction of quotas in their country. At the current time, the Scottish Parliament does not have the ability to establish a private sector quota as " the creation, operation, regulation and dissolution of types of business association" is reserved under the Scotland Act 1998. At a European level, the European Parliament put forward a proposal in November 2013 for a directive to improve the gender balance amongst non-executive directors of companies listed on the stock exchange, although there has been no further progress on this. Whilst there appears to be consensus on the need for such a move, there appears less agreement on how this can be achieved, although the current European Commissioner for Justice, Consumers and Gender Equality supports a binding quota over a voluntary approach.

Most countries that have adopted a quota have done so only for publicly listed and/or state-owned companies. Norway took the lead in introducing a law for quota regulations enacting legislation on 1 January 2006 for 40% minimum female representation on all boards (with the exception of small family enterprises).Businesses were also required to account for their gender equality practices across all levels of the business.The rationale for this was to place emphasis on:

• Providing equal opportunities to men and women to contribute.
• The value of the principle of equality, which underpins Norwegian politics and society.

Concerns were raised by some business representatives who believed businesses should be free to choose whom to appoint (Fouche and Treanor, 2006). There were also concerns that negative views would result from a belief that women were not being appointed on merit, with only 25% of women in favour of a quota approach (Rosati and Bailey, 2013, p.8). The approach has been successful as Norway has gone from 9% women on boards in 2003 to 40% in 2012 (Vinnicombe et al., 2015 ), although there is some evidence that some companies avoid the quota through relocation or a change in incorporation status (Ahern and Dittmar, 2012).Opinions on the attractiveness of adopting quotas is diverse and divided.The House of Lords European Union Committee received evidence on this topic in 2012 and concluded that in principle quotas should be avoided as they generate negative perceptions in the business world as they do not change the underlying issues that affect gender diversity (House of Lords European Union Committee, 2012).As a result, they believe, more effective change can be generated by engaging business in the process. Similarly, recent research by the Chartered Institute for Personnel Development ( CIPD, 2015) found that quotas are not effective unless they are enforced by sanctions and that the effects of quotas are not always sustained over the long-term.

Voluntary Targets

Voluntary targets (sometimes refered to as 'coaxes' in the literature) encourage businesses to increase the number of women on boards without the need for legislation or compliance measures. This is the approach adopted by the Davies Review, which recommended that "(a)ll Chairmen of FTSE 350 companies should set out the percentage of women they aim to have on their boards in 2013 and 2015. The review led to the development of a voluntary framework for gender representation on corporate boards and an annual Women on Boards progress report is issued.The most recent report (Davies, 2015) indicated that women now account for 26% of the board members of FTSE100 companies and 22% of board members on FTSE250 companies, compared to 13% and 8% in 2010. In recognition of the success achieved in the first 5 years, it has been recommended that a new target is set to increase women's representation on FTSE 350 boards to a minimum of 33% by 2020. Effectiveness of a voluntary approach can be maximised through a range of supporting measures including setting targets and monitoring progress, tackling unconscious bias within organisations and having supports in place to develop the talent pool.

Corporate Transparency

Corporate transparency requires companies to report on a range of diversity measures including the range of policies in place and the numbers of women. Within the EU this is required under the non-financial reporting Directive, whereby some large companies will need to provide information on the make-up of their board.Australia has adopted a 'comply or explain' approach around gender diversity policies (Vinnicombe et al. 2015).In the UK the practices of Narrative Reporting (i.e. the inclusion of non-financial information including the number of women at different levels within the company) and the requirement for the publication of a company's diversity policy and board make-up through the Corporate Governance Code support the voluntary approach. Corporate transparency is seen as effective because it gives investors the data they need to hold companies to account ( EY, 2014).In the Australian case, the proportion of ASX 200 board members had increased from 9% in 2010 to 18% in 2014.

Company and Stakeholder Views on Policy Approaches

Stakeholders and companies (through the e-survey and case study interviews) were asked for their views on policy approaches and what role the Scottish Government should play in achieving gender balance and broader diversity on boards.

Interviewees across these groups felt strongly that the Scottish Government should not impose quotas for the number of women on corporate boards.Although, the Partnership for Change Commitment is a voluntary approach to achieve 50:50 by 2020, there were some concerns that it could be perceived as a quota.

Overall there was a view that businesses should take the lead on this issue and the role of the Scottish Government and its agencies should primarily be to 'nudge' them towards considering issues and providing support. Companies and stakeholders argued the government should:

• Recognise individual business contexts and not legislate to enforce achieving gender balance and broader diversity. There was a strong feeling it is up to firms to assess if these are barriers and address them.In particular, the view was that the Scottish Government should not interfere directly with small businesses where the focus is on survival and not gender equality.
• Not implement positive discrimination measures as there was a perception that this can lead to resentment from other board members who see people being appointed even although they don't have the right skills, and will not engender good working together which is essential for boards.

Some stakeholders, however, felt the Scottish Government should be providing clearer leadership on this issue to business. Initiatives like the Scottish Business Pledge are a good approach as they help hold a mirror up to businesses and their practices. However, it is important to note here that raising awareness of the issue is not in itself sufficient to address the issue.

Figure 4: Awareness of Davies Review (% of Companies)

	All companies	Female account for less than 40% of board	Female account for 40%+ of board	No. of female board members increased in last 5 years
Aware of Davies Review	38	35	43	50
N	40	26	14	20

Source: TERU E-survey (2015)

Companies completing the e-survey were asked whether they were aware of the Davies Review.Overall, 38% of companies were aware of this publication.Whilst 15 companies identified that they were aware of the Davies Review, only 3 were able to identify actions they had taken in response to its publication, including one that had established a minimum target of board membership in response.

Interviews with companies and stakeholders suggested that it is important that practical supports are also in place - for example, highlighting good practice so that companies have benchmarks to try to emulate. More details on the specific actions companies and stakeholders felt Scottish Government should take to improve the gender balance and broader diversity of private sector boards are given towards the end of this chapter.

Approaches Taken by Participating Companies

It is worth noting that stakeholders generally had fairly limited direct experience of what companies were actually doing about improving gender balance or broader diversity so much of what they say is based on their perceptions about what is happening. Nevertheless they felt there was a lot of talk about the need for companies to achieve gender balance but ' disconnect between the talk and the actions that they take' and there was a need for more action to drive change. The case studies and e-survey indicate there is no consensus about the benefits of gender balance and broader diversity. For a lot of companies, and particularly SMEs this issue is not at the forefront of their minds.Many companies still do not feel that there is much to be gained by achieving greater diversity at board level. This inevitably means that the extent to which companies are taking action on this is likely to be variable across Scotland. This section draws primarily on the information collected from the survey and case studies to provide a snapshot of their views on what actions are relevant and what they are doing and supplements this with some research findings highlighted in the literature.

Figure 5: Policies and Procedures in Place to Improve Gender Balance of Board (% of Companies)

	All companies	Female account for less than 40% of board	Female account for 40%+ of board	No. of female board members increased in last 5 years
Mentoring or peer support for senior managers to prepare them for taking on board roles	34	36	31	40
No policies or procedures in place	29	32	23	15
Creating networking opportunities for senior managers	29	32	23	20
Training for senior managers to prepare them for taking on board roles	26	28	23	25
General changes to HR to promote flexible working	24	20	31	25
Training for board/senior management on equality, diversity and bias	24	24	23	30
Ensuring all board positions are advertised	21	16	31	25
Improving transparency of board recruitment processes	13	8	23	20
Other	13	16	8	10
Don't know	11	4	23	10
Setting targets for gender parity within board	11	12	8	10
Ensuring board positions are marketed towards female candidates	8	12	-	10
Report on gender composition of board in annual report	8	8	8	15
Making changes to the 'person specification' for board roles	8	8	8	10
Setting targets for gender parity within workforce	5	4	8	5
Making changes to how and/or when the board meets	-	-	-	-
N	38	25	13	20

Source: TERU E-survey (2015)

Companies completing the e-survey were asked about what policies and procedures they have in place to address the gender balance on their boards:

• 29% of companies had no policies and procedures in place to address the gender balance of their boards.
• The median number of policies and procedures adopted was 2.Only 7 companies had adopted 5 or more of the policies and procedures.This suggests that even where action is being taken, it is relatively 'light touch'.
• The most commonly adopted policies and procedures are mentoring and/or peer support for senior managers to prepare them for board positions, creating networking opportunities for senior managers and training for senior managers to prepare them for taking on board roles.It is noticeable here that these are all focused on developing the pipeline of candidates.Whilst some companies were also adopting processes and procedures that changed recruitment processes or around placing greater priority on improving the gender balance of the board, these were less common.
• Whilst the sample sizes are small and care must be taken in interpreting the results, it is noticeable that companies where 40% or more of the board members are female, they are generally no more likely (and in some cases less likely) than those with less than 40% female board membership to adopt these policies and procedures.It is unclear why this might be.The key exceptions to this appear to be around the advertisement of board positions and improving the transparency of board recruitment processes - suggesting these may be key to achieving greater female representation.
• Similarly, there does not appear to be a clear difference between the policies and procedures adopted by companies that have increased the number of female board members in the last 5 years and companies as a whole.

Figure 6: Activities and Supports that Have Been of Value in Improving Gender Balance Within Their Company (% of Companies)

	All companies	Female account for less than 40% of board	Female account for 40%+ of board	No. of female board members increased in last 5 years
Commitment by Board to improving gender parity	37	38	36	47
Commitment by Chief Executive to improving gender parity	31	29	36	53
Changing gender profile of our business leading to more females in senior management roles	31	33	27	32
Policies and/or processes in place to improve board and staff understanding of equality, diversity and potential bias	29	17	55	26
Changing gender profile of our sector leading to more females in senior management roles	26	25	27	21
Increasing numbers of women applying for board positions	23	21	27	21
Policies and/or processes in place to encourage female applicants	14	8	27	16
Commitment to report on board diversity in Annual Report	9		27	16
Making board recruitment processes more transparent	9	8	9	11
Ensuring board positions are advertised	6	4	9	5
Other	6	4	9	5
Changing 'person specification' for board roles to enable a broader range of candidates are eligible to apply	3	4	-	-
Changing how or when the board meets to encourage a broader range of candidates to apply	3	4	-	-
Don't know	-	-	-	-
N	35	24	11	19

Source: TERU E-survey (2015)

Companies were also asked about what has been of most value to their business in improving the gender balance of their board:

• The most common answer was commitment by the board to improving gender equality (mentioned by 37% of companies), followed by commitment by Chief Executive (31%).Perhaps unsurprisingly, the proportion of companies that had increased the number of female board members in the last 5 years identified these approaches were of value to them, and was higher than for all companies.
• 31% of companies identified that changing the gender profile of their business as a whole was a key factor, and 26% identified that the changing gender profile of their sector had helped them improve gender balance.
• Companies where females account for 40% or more of the board members were much more likely to say that having policies and processes in place to improve board and staff understanding of equality, diversity and potential bias had been of value to them in tackling board gender balance (55% compared to 17% of companies where females account for less than 40% of board members and 29% of all companies).
• Very few companies identified having targets in place, commitments to report on board diversity or changes in recruitment processes (such as ensuring transparency of recruitment process, changing person specifications or ensuring all vacancies are advertised) being of value to their business in improving the gender balance of their boards.

Figure 7: Activities and Supports Considered to Help Improve Gender Balance of Boards (% of Companies)

	All companies	Female account for less than 40% of board	Female account for 40%+ of board	No. of female board members increased in last 5 years
Commitment by Board to improving gender parity	60	58	64	79
Commitment by Chief Executive to improving gender parity	51	50	55	68
Policies and/or processes in place to improve board and staff understanding of equality, diversity and potential bias	49	42	64	63
Increasing numbers of women applying for board positions	46	46	45	53
Policies and/or processes in place to encourage female applicants	43	33	64	63
Making board recruitment processes more transparent	43	38	55	47
Changing gender profile of our sector leading to more females in senior management roles	40	29	64	53
Changing gender profile of our business leading to more females in senior management roles	37	21	73	53
Commitment to report on board diversity in Annual Report	31	25	45	42
Changing 'person specification' for board roles to enable a broader range of candidates are eligible to apply	29	17	55	37
Ensuring board positions are advertised	23	13	45	26
Changing how or when the board meets to encourage a broader range of candidates to apply	17	4	45	21
Other	9	13	-	-
Don't know	6	4	9	5
N	35	24	11	19

Source: TERU E-survey (2015)

In addition to asking companies about what has been of most value to them in improving the gender balance of their board, they were also asked what approaches they thought were improving the gender balance of boards in general:

• The most notable finding is that the percentages at each answer are higher than for the equivalent question about what they had found useful for their business.For example, 49% of companies felt introducing policies and/or processes to improve board and staff understanding of equality, diversity and potential bias was a useful approach to improve board gender balance in general, but only 29% said these had been useful to them in improving the gender balance of their board.This raises a number of interesting questions - including why companies are not adopting approaches that they believe to be key to tackling this issue and whether some approaches are not as effective as generally perceived.
• In general, companies where at least 40% of the board are female and those that have increased the number of female board members in the last 5 years tend to view these approaches to be useful in improving the gender balance of boards than companies as a whole.

43 companies completing the e-survey provided information on how the number of women on their board had changed over the last 5 years:

• In 21 companies (49%), the number of women on the board had increased over the last 5 years.
• It had stayed the same in 18 companies (42%).
• The number of women on the board had decreased in 4 companies (9%).

Looking at those companies where the number of women on the board had increased over the last 5 years:

• 10 companies (48%) said the main reason for this change was that more appropriate female candidates were applying for board positions (for example, candidates that have more experience, have more relevant experience, etc.).
• 6 companies (29%) felt the main reason for the change was the policies and practices they had adopted.
• Other reasons given included:
• Greater awareness of the benefits of having gender balance on the board, including as a result of the recommendations made by the Davies Report.
• An increase in the size of their board which had created additional opportunities for board membership.This included one case where the company decided to broaden board membership to include individuals in specific senior roles within the company (with the current incumbents being female).

The case studies allow us to look at some activities and actions in more detail. We have presented these in terms of:

• Broad actions that companies take to support the issue of improving gender balance and broader diversity across workplaces.
• Specific actions to support the talent pipeline.
• Specific actions to change boards.

Broad Actions to Improve Gender Balance and Broader Diversity Across Workplaces

Policies/Processes to Improve Understanding of Equality, Diversity and Bias

The e-survey and case study interviews show companies are aware of the importance of promoting equality and diversity within their companies. For example all except one of the case study companies have equality and diversity policies and most provide training around equality and diversity but we found little assessment of the impact of the policies, although one case study (Case Study A) reported that their policy is reviewed annually. Some case study companies have provided training to address unconscious bias but this is generally across the workforce rather than specifically for board members.

Case Study Examples: Policies and Processes to Improve Understanding of Equality, Diversity and Bias

Case Study B has an equalities and diversity policy which covers the workforce, management and the board and states it is the policy of the company 'to treat all employees and job applicants fairly and equally regardless of their sex, sexual orientation, marital status, race, colour, nationality, ethnic or national origin, religion, age, disability or union membership status'. They are also an Investors in People (IiP) employer and believe this helps get the best out of people across all protected characteristics. They have also signed up to Partnership for Change and display messages from this campaign throughout the premises. This lets employees know that they are committed to achieving gender balance and broader diversity. Informal approaches are also important. An example of this is taking careful note of the language they use for example, not using 'girls in the office' and ' boys in the workshop' as this can perpetuate ideas that these roles are defined by gender.

In Case Study H all employees undertake diversity training. They feel that they could do more to raise awareness of unconscious bias as this has a profound impact on underlying assumptions which in turn influences decision making. Tackling this could help support progression of people through the organisation to increase the pool of internal candidates they have for senior positions.

However, only one case study had a policy to promote diversity on their boards. It is highlighted in the box below.

Case Study Examples: Policies and Processes to Improve Understanding of Equality, Diversity and Bias

Case Study A's board diversity policy covers the protected characteristics of gender, age and ethnicity alongside other personal characteristics such as nationality and age. This was first implemented in 2014 and is reviewed annually. This policy sets out the approach to diversity in each of the main boards of the company and outlines the benefits of diversity in relation to increasing the likelihood of good strategic decision making.Diversity is defined broadly in the policy and ' starts with a balance of gender, age, ethnicity and other personal attributes' but they also want to have directors from 'different backgrounds including educational and geographical origin'. The policy prescribes that a committee should oversee the board to see that it is balanced in terms of skills, experience and diversity and should take steps to ensure that barriers and unconscious bias are removed to ensure that they get the best person for each position. This might involve using open advertising, using recruitment agencies that have signed up to a voluntary code of conduct for search firms, considering candidates from a wide range of backgrounds and ' assessing candidates on merit against objective criteria, taking into account the benefits of improving diversity on the board'.It seems that this policy has had some impact as in the last 5 years the company has appointed 3 board members who are all women.

Changing the Gender Profile of the Workforce

The chapter on barriers highlighted that a key barrier is the lack of female candidates coming forward for board positions, and if they do, they often lack the skills and industry experience needed. The case study interviews suggested there is a need for more women in senior management which allows them to gain the experience (and perhaps confidence) they need to apply and secure board positions. It was clear that companies with female CEOs are attractive for women seeking senior management and board positions. There was recognition that action needs to be taken on a range of fronts to increase the number of female candidates including:

• In industries where the workforce has more males there is a need to attract more females who are then able to progress towards senior management and boards. This then includes action to change the gender profile of the workforce.
• In industries where the largest proportion of the workforce is female but few female managers, there needs to be action to support the progression of females through supporting a talent pipeline. Even in industries where there is a good balance of males and females in the workforce, there may be a need to provide additional support for females on the pipeline to help them to progress to senior management.

A small number of case study companies recognised their workforce was imbalanced which could have a knock on effect on the number of females progressing to senior management (and the board) and could make their business less attractive to new recruits. There is also a need to support progression of female staff so they progress to senior management.Examples of actions taken in this area by case study companies are highlighted in the box below.

Case Study Examples: Changing the Gender Profile of the Workforce

Case Study B encourages males and females to apply for all positions in the company. They have tried to improve the gender balance in positions which are traditionally male (driving/operatives) and female (office). However, although they encourage this at the recruitment stage it is still important that they ' get the right person for the job'.One practice that they have tried is making CVs anonymous to ensure they focus on the content of the CV and no other factors. Despite this they have had few women applying for driving positions or men for office positions.

Case Study H aims to increase the diversity of the workforce at the entry point and then develop their own people to give them the capabilities to become senior managers and eventually progress onto the board. One element of their approach is establishing a leadership programme for people with potential to become senior managers. They recognise that each of the people on the programme will need individualised support to address their particular developmental needs and so the programme provides a mix of group activities and individual support through coaching. This should help to develop their internal pipeline and although it is not tackling gender imbalance overtly, they feel that they will achieve greater balance as an indirect consequence of the programme as women are being supported through it. Feedback from participants indicates the programme provides good developmental opportunities, helps give managers better insight into their performance and ways of working, and provides a good base to progress. Nevertheless they feel they would need to provide more specific training for people to progress onto the board which would involve helping them develop more commercial awareness and financial skills as greater depth of knowledge of these aspects of business is required by board members.

Flexible Working

Some of the case study companies had introduced flexible working in the last 10 years to attract and retain more women in the workforce. Two companies also thought the wider availability of flexible working could promote more movement of women in their industries and thereby encourage more women to go for senior posts in other companies helping more to progress to senior levels. None of the case studies explicitly raised the issue of shared maternity/paternity leave. The literature suggests that improved sharing of best practice across organisations e.g. how organisations support women around flexible working, could be beneficial (Vinicombe et al., 2015).Examples of actions to improve flexible working from the case study companies are given in the box below.

Case Study Examples: Flexible Working

Case Study A finds offering the same flexible working arrangements to new senior appointments that they had in their previous job has helped attract more women to the company at a senior level. This is because many women in senior positions feel tied to employers which have allowed them flexible working. They hope that this may promote more movement of women in the industry and help more women progress to senior levels to get the industry experience they need to progress onto boards.

Case Study D's flexible working, including options to work part-time, to start and finish at different times of the day and to work from home, was introduced in the last 8 years to improve staff retention. It was introduced following exit interviews with employees who left because it was not available. Flexible working has been useful for the board member interviewed as she has family commitments.

Case Study F found they were having some issues retaining females. They responded by introducing 'smart working' (flexible working) options for returning mothers. This proved to be an effective way of helping returning mothers to integrate more successfully into the workplace. In the last 5 years since they have introduced this they feel this has helped them to retain staff and it has been 'good for business'.

Case Study H has a number of practices that support people achieve a work - life balance such as flexible working policies, and arrangements to work from home. If women take time out of the labour market to have a family they do not have the chance to develop that breadth of experience that may be required for board membership and this can help to mitigate this as female staff are retained.

Specific Actions to Support the Talent Pipeline

Action to enhance the opportunities afforded to women in senior roles within their organisations was embedded into companies' activities to develop their talent pipelines. The prime rationale for having a talent pipeline is that many companies prefer to promote rather than recruit external managers or find it difficult to recruit the talent they want. Some companies have also used this to respond specifically to a lack of external female candidates for senior management or board positions with the skills and experience they need. Generally these programmes are available to everyone in the workforce, although one or two companies offered specific support for women or people in other protected characteristics groups.

This kind of approach sits well with research which indicates that women need to be supported effectively through to the boardroom more so than men. This requires longer term planning.Programmes to encourage younger women (21-28 years) to engage at a more senior business level would also help to provide relevant experience (Scottish Office, 2015). Examples of approaches are shown in the box below.

Case Study Examples: Supporting the Talent Pipeline

Case Study A developed their pipeline in response to the difficulty of recruiting female candidates with enough industry experience. Approaches include training and mentoring. They feel this commitment to development will pay off in the longer term as more women will move into senior management positions enabling them to develop the experience they will need to move onto the board. One interviewee with experience of the pipeline saw no barriers to board membership due to her gender within the company, but did recognise that the company was exceptional in its industrial sector and there were barriers more generally for women.

Case Study F has a range of practices to develop the pipeline of people who have the potential to be future board members. All employees have a development plan which aims to help them achieve their potential. The company has also done some research into what kinds of support best helps female employees because they felt their existing development interventions were not helping women progress into senior roles. This helped them to develop a much more targeted and individualised programme which identifies the kinds of actions which will assist each particular person. It is 'no longer a tick-box exercise'. They have also found that mentoring works well. They have senior women in a variety of roles who can provide mentoring and good role models. These have helped more women to progress into senior management within the company and progress onto the board. There is good support within the company to assist women to progress to senior management.Monthly appraisals help employees identify the areas they need to work on to help them to progress.

Case Study C hopes that supporting more women on their internal pathway to becoming a partner could improve the gender balance. The internal pathway involves people being mentored by senior partners as they develop their skills and experience.Recent recruits have been female and there is an expectation they will progress towards board membership provided they are able to work the hours that goes along with board membership. Males and females follow the same pathways. Interviewees on the pathway felt there were no barriers to gaining a board position should they want to achieve this: ' the firm gives everyone a chance'. There is investment in training and support ' to help grow the skill set they are looking for'.

Case Study G offers a mentoring programme to all employees at divisional management level to help them develop their skills. Employees have mentoring meetings with the managing director to discuss operational issues every 6 weeks. The aim is to help these managers see their role differently and to see how they could improve their performance. Although the company recognises not all of the mentored employees will progress to director level, they have had good results from this programme, with the staff involved taking more ownership of their work, improving their decision making and having a clearer idea of their role, and they think in the longer term this may help more females to think about progressing to board level.

Case Study I is committed to developing their internal talent pipeline so that employees can progress to director level if they have the talent and skills. This can involve providing personal development opportunities and mentoring. They recruited two females recently and provided mentoring and peer support to prepare them for taking on board roles.

Over the medium to long-term, the current owners of Case Study J would like to be able to exit the business - ideally through a management buy-out.This will affect the composition of the board.As the company founder is female, the Managing Director would like the company to continue to have good gender representation at the management and board level in the future.To help facilitate this, all staff members have a career progression pathway - and the potential for them to reach into any job within the organisation (including the board) is communicated by the Managing Director on a regular basis.Staff are encouraged to take part in training and development activities, with time scheduled weekly for staff to review internal training materials. In addition, the company makes use of external training with staff members encouraged to identify training that meets their needs and ambitions.

Specific Actions to Change Board Composition

Commitment to Achieving Gender Balance and Broader Diversity

One way of taking action on a lack of diversity in boardrooms recognised in the literature is gaining by-in from chairs to ensure the value of women in the boardroom (Davies, 2013). This needs to be supported by an inclusive organisational culture throughout (Vinnicombe et al., 2015).

Getting buy-in which translates into commitment by the board and the CEO to seeking gender equality was seen as important by both the respondents to the e-survey and the case study companies as it was perceived that commitment is the first step in developing strong leadership around this issue. The case study companies with a strong interest in achieving diversity at board level identified commitment and leadership is critical to any progress they had made as it had allowed a strong focus within the board on the importance of the issue.The case study box below highlights companies where there is strong commitment to increasing diversity.

Case Study Examples: Commitment to Achieving Gender Balance and Broader Diversity

Case Study A's board and Chief Executive are committed to improving gender equality on the board. Under the steer of the last two chairs there has been conscious effort to try to achieve greater balance on the board. The company believes leadership around this is very important to set the agenda, ensure buy-in from all board members and to set the right direction. Leadership is also critical to how the board operates which aims to overcome the barriers that prevented women coming onto their board in the past. Board members commented that the chair of the board sets a very good 'tone at board meetings to allow all board members to participate' equally and effectively. A culture is created that is able to accommodate diversity rather than being male dominated, which is often the case within the industry sector.

Case Study F reported there is strong commitment across the board to achieving gender balance. Leadership is critical. The company's Managing Director has personal experience of discrimination and became interested in unconscious bias as a result of this. Her experience has been the driver for developing the company's approaches to tackle gender imbalance which include making sure all recruitment consultants undergo unconscious bias training, encouraging whistle blowing and positive challenges if any consultants come across problems around recruitment with their clients, changing the gender profile of the business leading to more females in senior management roles, and providing all employees with a development plan which aims to help them achieve their potential. The company has also done some research into what kinds of support best helps female employees because they felt that their existing development interventions were not helping women progress into senior roles. This helped them to develop a much more targeted and individualised programme which identifies the kinds of support they needas an individual, which may include a particular type of training or coaching. It is 'no longer a tick-box exercise'.There is also good support within the company to assist women to progress to senior management.Monthly appraisals help employees identify the areas they need to work on to help them to progress.There is flexible working within the company.

Making Board Recruitment Processes More Transparent

The literature highlights that raising awareness around the role and remit of boards could potentially increase the potential pool of candidates (Dutton and Raeside, 2014). The way in which companies go about recruiting board members will potentially impact on the diversity of the board. Board recruitment processes are not always transparent and this has been seen historically as a barrier to the appointment of women, with appointments being made to mirror the existing (predominantly male) membership (Sealy, Doldor, and Vinnicombe, 2009). Very recently there has been a call to 'demystify' application processes (Scottish Office, 2015, p28). A good understanding of how recruitment is undertaken can help to shape approaches to increasing the number of women (and other underrepresented groups) on boards. As the literature suggests wider and more transparent advertising could increase diversity by making the process fairer. There is also a need to take an objective look at the criteria used to appoint new board members.

The e-survey showed that many companies continue to use personal networks or internal promotion rather than advertising board positions. When asked how they recruit new board members:

• 23 companies (53%) indicated that they use their own networks and contacts of the existing board and/or senior management to identify potential candidates.
• 10 companies (23%) use executive search agencies.
• 8 companies (19%) use an open recruitment process (e.g. advertised in newspapers, through professional bodies, etc.) managed in house.
• 5 (12%) recruit in-house from their own staff.
• 1 (2%) hosts awareness-raising events to stimulate interest.

Whilst we cannot establish causality (and as outlined earlier small sample sizes mean care must be taken in interpreting results), there does appear to be a linkage between the openness and transparency of recruitment processes and the representation of women on boards:

• 61% of companies with a board that is less than 40% female use their networks and contacts to identify potential candidates, compared to just 40% of companies with boards that are 40% or more female.In contrast, just 14% of those with male-dominated boards use open recruitment processes compared to 27% of more equal or female-dominated boards.
• The majority of those using executive search agencies (6 out of 10) or open recruitment processes (6 out of 8) have increased the number of females on their board in the last 5 years.

Some of the case study companies were also making their recruitment processes more transparent but only four case studies said they have proactively recruited female candidates. An example of this activity is shown in the box below.

Case Study Examples: Making Board Recruitment Processes More Transparent

Case Study A has made 3 appointments to the board in the last 5 years and they have all been female. This is a result of proactively recruiting female candidates. New appointments are made when specific expertise is needed but when appointments are made checks are carried out to ensure that the board is balanced. A committee oversees the boards to see that they are balanced on terms of skills, experience and diversity and takes steps to ensure that barriers and unconscious bias are removed to ensure that they get the best person for each position. This might involve using open advertising, using recruitment agencies that have signed up to a voluntary code of conduct for search firms, considering candidates from a wide range of backgrounds and 'assessing candidates on merit against objective criteria, taking into account the benefits of improving diversity on the board'.

Some case studies use executive search companies and encourage them to look for female candidates. These firms have a potentially key role in the appointment of executive and non-executive directors. In the UK a Voluntary Search Code ^[13] (signed by more than 50 search firms) sets out guiding principles for achieving gender diversity and best practice. This code of practice includes guidance on taking a broad view of succession planning, well defined briefs that identify core competencies not just career experience, long lists comprising of 30% women, candidate support throughout the process and effective induction.

Developing networks and sponsors is important to widening access. An individual's networks and their access to sponsors in a position to actively promote them to a board position are likely to be key factors in their success.Those recruiting for board positions, whether they are head hunters or existing board members need to seek to sponsor talented individuals, particularly into their first role. As 73% of men and 68% of women use their personal networks as the primary means of securing non-executive directorships, with a greater likelihood of success for those known or recommended, this highlights this as a potential area for intervention (Brown, Kelan, and Humbert, 2015). The case studies suggest that few people have access to these kinds of networks and sponsors and tend to rely on internal mentors.

Approaches used by the case study companies are highlighted in the box below.

Case Study Examples: Use of Networks

Case Study F generally looks for board members when they require particular talents or skills. This is determined by regular reviews of the board to ensure they have the right talent to achieve their goals. In the last 5 years the board increased from three people to seven as the company has grown. Most of the new female members were promoted into the role and so their track record was evident.Some of them however, were invited to join the board because they had particular perspectives or skills that the company felt were needed on the board.

Case Study G mainly used senior managements' and other board members' networks to recruit new board members with no formal interview process. This is still an important method for recruitment and they feel it does not create any barriers for women because there are women on the board who have good networks.In addition they have recently appointed a talent manager to find new board members as they want to enhance the capabilities of their board. The main skills and experience they are looking for are knowledge of the market place and a good track record in terms of generating revenue.

Mentoring and Peer Support for Existing and Potential Board Members

Training and mentoring support is required for existing and potential board members who need to be able to access a range of training, mentoring and network opportunities.The creation of dynamics on the board that are inclusive are critical (Vinnicombe et al., 2015) and mentoring can provide legitimacy and promote inclusion, supporting the development of alliances with existing board members (Dutton and Raeside, 2014).

Some companies provide training for senior managers to prepare for board roles as highlighted below.

Case Study Examples: Mentoring and Peer Support

Case Study A has used mentoring to help to retain talented women. They looked carefully at what stage women tended to 'step back' from pursuing promotion and found this was linked to maternity leave. They are investigating whether there is anything that they can do to improve this, for example by offering mentoring to women on maternity leave to help them keep engaged and help their return as well as training mangers to better manage maternity leave. They feel this will help retain women in the company and encourage them to progress to higher management levels.

Case Study B has not recruited for new board members in the last 5 years but as they grow they would like to expand their board and so are looking at how to recruit new members. All of the employees know that gender balance is important to the company and it is part of their values as well - if they did not share these values they would not be in a senior management position or board member as these issues are discussed frequently within the company. The company invests in training to develop managers' skills and particularly soft skills and to increase their confidence. These kinds of practices help them to retain talent. A manager involved in the pipeline activity indicated that these initiatives are offering opportunities to develop her skills, particularly leadership and management.

Case Study D provides mentoring or peer support for senior managers to prepare them for taking on board roles: One board member has benefited from this. She was invited to join the board in 2014. Although she had no previous experience of sitting on a board she has been pleased to join the board and sees it as an important aspect of her role as it is part of securing the long term future of the business. The company's commitment to training for managers has also been an important contribution to helping her fulfil her board role effectively.

Case Study I believes it is important to make a contribution to developing talent in their sector by supporting people to develop the skills they need for senior management and board membership. This includes offering support to females and people from other groups. One of the ways they do this is by offering graduate placement programmes which includes shadowing their board. In the recognition that it can be quite difficult to get board experience and to encourage more people to put themselves forward for board positions they have offered people opportunities to shadow their board. They feel this is particularly useful for younger people as it helps them to understand board processes. They feel that there is a gap in understanding of governance and few opportunities for people to see boards in action. 'People need to see the nuts and bolts of being on a board'.

Case Study J has provided an external mentor to a senior (male) member of staff to support them to progress towards a board level position.This individual currently attends senior management meetings (where the majority of strategic decisions are made). The company owners would like to exit the company over the medium to long-term, ideally through a management buy-out and the support offered to this individual could be replicated for other members of staff once they reach a similar level through the company's structured career pathways.The mentor that has been appointed is highly respected within their industry.They are contracted to support the company one day a month - with half of this dedicated to mentoring and the other half to attending senior management meetings and supporting the directors. This individual being mentored felt that the mentoring had helped him develop his management and leadership capabilities.In particular, it had given him an opportunity to 'step back' from his day-to-day role and reflect on how he can make the most effective contribution to the business and gain a wider perspective. He felt that as it can be difficult to 'know what you do not know,' the external mentor had helped him identify areas where he needed to develop his skills that he would not otherwise have considered.

Few of the existing board members interviewed had taken part in any training to help them with their role. An example of this is highlighted in the case study below.

Examples from Interviews with Existing and Potential Board Members: Mentoring and Peer Support

The board member has received external support to help her fulfil her position as a board member including a Scottish Enterprise course Investing in Women which aims to develop leadership and provides training on the role of the board and how to work effectively as a board member. This helped her to better understand her contribution to the board and how to be more effective. However she felt this kind of training is fairly limited in scale and in general the training opportunities available to all board members could be increased. In particular opportunities to shadow board members and access to mentors would be helpful to increasing diversity and gender balance on boards.

Creating the right atmosphere where new board members are supported and accepted is also critical. The literature suggests getting a critical mass of women on the board is important.Three is considered a critical number in group dynamics, whereby one person has the potential to impact but risks being viewed as tokenistic, two may have more success but tokenism still exists but three delivers critical mass (Asch, 1955). Their presence normalises the presence of women on the board and consequently allows for their views to be listened to with more open minds (Kondrad et al., 2008).

Some of the experiences of the case study interviewees who were board members are useful here to shed light on how this works. As above, to protect identities we have not organised this information by case study.

Examples from Interviews with Existing and Potential Board Members: Mentoring and Peer Support

A board member joined her company's board 4 years ago as an executive director when she became an employee of the company. She was interviewed by two women and knew that the then CEO and MD were women and this made the idea of joining the company attractive to her. The main factors that helped her attain a board position were her experience, skills, abilities, values and people's belief in her when she was recruited. She has also had a lot of informal support in her career and a mentor who helped her to see her value and strengths.She has also had the benefit of many positive role models to follow.When she first joined the board she did face some challenges around learning the board's 'language', understanding what was expected of her as a board member and around adapting her style of working to that of the board's to ensure that her voice was heard. She has gradually learned to overcome these challenges through experience.

Another interviewee in a different company was recruited to the board when she was an employee because she had the skills and capabilities that the company was looking for.She also had a good understanding of what the role would require because she got a lot of support from the other board members during recruitment and during her initial period on the board.She also felt that she brought skills and experience to the board that had been lacking before she joined and she had a good fit with the requirements of the role.

Another interviewee commented the chair of the board sets a very good 'tone at board meetings to allow all board members to participate' equally and effectively. A culture is created that is able to accommodate diversity rather than being male dominated, which is often the case within the industry sector.

In another company the board member was invited to join the board around 5 months after she joined the company as a senior manager.At the time the board was seeking someone with specific expertise around managing people and the board member had this experience.However, she had previous board experience which helped secure the position. She was keen to join the board and saw it as an opportunity and a challenge. The board member has had some external support. This includes having a mentor for over 10 years. Mentoring has helped the board member to ' push myself a bit'. The mentor has also helped the board member to be more effective by developing a focus on strategic issues. The board member also works with a leadership coach which has helped boost their confidence and develop their leadership style. All of the board members have access to mentors or leadership coaches which is part of the company's efforts to develop their own talent pipeline. The board member has encountered some challenges relating to the ways that some members of the board like their voices to be heard which can come across as aggressive. However, the coaching has helped the board member to address these challenges without compromising their own style of debate.

Setting Targets

Setting targets for gender diversity and monitoring compliance will help ensure increasing diversity is prioritised (Dutton and Raeside, 2014).This could include setting out aspirational targets for the number of women on boards.The monitoring of progress needs to be transparent.Within organisations CEOs need to know where women are contributing across the organisation, requiring detailed and accurate data around starts, promotions and performance (Vinnicombe et al., 2015).

Only two case study companies had targets for board diversity as shown below.

Case Study Examples: Setting Targets

Case Study A monitors diversity issues drawing on the results from their annual employee survey. This provides very useful information on the way different groups in their workforce are affected which helps them identify the areas that they should take action.They have made good progress recently in identifying the issues affecting the promotion of LGBTI people and have set up a mentoring scheme with external mentors to support people.Annual reviews on the composition of their boards are also carried out. The Davies Report has been a strong influence on target setting as it has generated debate and increased attention on the issue. This helped to strengthen their resolve to do more about gender equality. This also led them to set an aspiration of ensuring the under-represented gender makes up at least 25% of each of their boards.However they would like to achieve 50:50 and would like to achieve this representation at all levels of the business in the longer term.Progress on this is reported to the board on a bi-annual basis and there is also commitment to report on board diversity in the Annual Report.

Case Study B have signed up to the Scottish Business Pledge which suggests companies should aspire to 50:50 representation. They feel that signing-up has helped them to think about the issues and consider gender balance when making appointments throughout the company although would still look for the right person for the job.In terms of workforce, due to the nature of the jobs, they tend to get more female applicants for office roles and males for drivers/operatives. They do not monitor formally, but keep an eye on this. With a small board (husband and wife owners) it is easier to maintain gender balance. They have no targets for representation of other protected characteristics.

External Support for Companies

Views of Stakeholders

Throughout Scotland a range of organisations provide support to companies to help them address gender imbalance and increase diversity. Some of the organisations mentioned in the consultation with stakeholders as making important contributions included Changing the Chemistry ^[14] , Equate Scotland ^[15] , Engender ^[16] , Women on Boards ^[17] , 30% Club ^[18] , Opportunity Now ^[19] and An Inspirational Journey ^[20] . However, stakeholders had limited direct experience of these organisations. Those who had some knowledge of the provision felt:

• These initiatives start a dialogue to get the issue on the agenda and capture attention. They use information about gaps in representation to grab attention to shine a spotlight. ' Corporates have a culture that holds women back'.This helps compel people to have an agenda and drives action.Such an approach is a ' critical step'.
• Approaches are generally light touch.They tend to focus on the benefits and when dealing with business it is always good to show the impact on the turnover, profit or other financial indicators. This kind of approach was seen as preferable to legislation.
• Initiatives that focus specifically on giving people board experience are helpful as is very difficult to get this experience. Scenario planning workshops (run by organisations such as the Institute of Directors) which involve existing board members guiding participants through real board room scenarios have been very popular; similarly ones that help people get non-executive positions in boards in public and third sectors can be helpful.
• There are some issues around the availability of support offered through these initiatives as they are not widely available and tend to be for women at particular stages of the career ladder rather than at all stages.Additionally, whether people get on these programmes depends on the firm that the women work for in the first place, and then only some can go as there is usually aselection process - therefore these could be divisive within a company if not everyone that wants to go/could benefit are selected.

Stakeholders also had limited knowledge of the impact and effectiveness of these initiatives. Overall stakeholders felt:

• Provision is piecemeal and more could be done to extend the availability of support.
• Concerned that many initiatives are only funded for short periods - limiting ability to learn lessons and make sustainable change. Many of the issues are cultural and to change culture requires long-term commitment.
• The initiatives addressing this issue are working effectively, but more could be done to publicise their outcomes and impacts.

Views of Companies

Five of the 10 case studies had engaged in external supports to improve board diversity although there was variation in the extent to which they had been engaged.In general these companies were ones that felt that there were clear benefits to increasing gender balance and broader diversity and had therefore sought out support.Those who had engaged generally found the support to be helpful.An example is given in the box below.

Case Study Examples: Use of External Supports

In Case Study F, the director participates in a range of initiatives that are focused on developing women in the workplace including Women's Enterprise Scotland, Women into Work, strategic groups within the Scottish Government and Changing the Chemistry which is a peer support group. She began to be interested in achieving gender balance around 6 years ago when she missed out on a promotion because the person chosen was recruited not on merit but because he was a member of an 'old boys club'. She had not encountered this kind of discrimination before and felt that she wanted to get involved in taking action to counter gender discrimination.These networks have provided her with lots of examples of good practice and allowed her to see the positive impact on the performance of companies which have a diverse senior leadership.She has used this experience in her own company. Her involvement in these networks has also offered her a lot of peer support. Additionally, the director has participated in the Institute of Director's mentoring scheme and board shadowing schemes which has helped her increase understanding of boards and how they operate.All of these initiatives have helped her to build her network, which can be useful, in turn to assist other women in business.

One of the reasons for the low engagement is that as the previous chapter has shown, increasing representation is not seen as an important issue for companies, so they would be unlikely to seek external support.However, even among companies which do see it as important there seems to be low awareness of these initiatives. A small number of interviewees in case study companies also perceived that there were some barriers to participation including:

• Limited number of places.
• Competition for places.
• Timing of interventions - some are scheduled in the evening or at breakfast time which can be difficult for women to access.

Potential Role for Scottish Government

Finally, companies and stakeholders were asked to identify how Scottish Government could support them to improve the gender balance and broader diversity of private sector boards:

• A number of companies felt that there was no role for Scottish Government - either because they felt to improve the gender balance and broader diversity of private sector boards was not necessary or because they felt it was primarily the role of companies to achieve progress on this issue.
• Many felt that the key role that the Scottish Government - and the public sector more generally - should place is around providing leadership on this issue:
• Many felt that the Scottish Government needs to achieve gender equality and broader diversity in public sector organisations and agencies first to legitimise this leadership role. Some even thought it should be mandatory to have gender equality on the boards of public sector organisations.
• The government's emphasis should be on how to support equality and diversity across the board rather than focusing on increasing the representation of a particular group (e.g. women). Without this broad focus there were some concerns that men might think they are being treated unfairly and this creates potential for a backlash against the policy.
• Many felt that Scottish Government could play a key role in increasing the visibility of the issue.It was felt it could do this in a number of different ways:
• By communicating the business case for diversity - it is still not widely recognised.
• By highlighting research such as the Davies Review - and especially any evidence around the benefits for smaller companies. There is still some work to do here. Only 38% of the companies engaged in the e-survey were aware of the Davies Report and only one case study company was taking action as a result of the report to ensure that they are ' actively working to ensure that the next round of elections to the board attracts more women'.Conversely one company was adamant that in terms of action the response to the Davies Report is 'in no way whatsoever.Board applications are based on ability and technical competence and experience - the abilities to do the job and not an artificial quota system'.
• By encouraging companies to provide information about diversity. There was a suggestion that some kind of accreditation might encourage companies to show what they are doing in this area - and in turn encourage companies to emulate others and think about gender a bit more.
• By utilising, where possible, public sector procurement to incentivise companies to look at gender balance. However, it should be noted here that any approach adopted would need to align with the legislation in place around public procurement.
• Scottish Government was also seen as having an important role in ensuring the supporting infrastructure to enable women to reach board-level positions.This includes ensuring policies in the following areas are supportive:
• The availability of appropriate childcare can help ' eliminate issues for women in their careers that men don't have'.This needs to be available so that women can work full time if they wish - and many requirements of board membership need people to work at the evening or weekend.
• Ensuring educational establishments work with young people and their parents:
• To change perceptions that females cannot get as far as men in the workplace.
• To encourage them to consider sectors and occupations where females are currently underrepresented or where there is gender stereotyping.
• This should help enable more women to reach management level positions. There is a need for better careers advice to indicate that there are opportunities for women in these industries and occupations.
• Availability of management and leadership programmes - such as those provided through Scottish Enterprise and Highlands and Islands Enterprise.
• Whilst companies generally felt that it was their responsibility to drive change, many would value advice and guidance on how to make progress on this issue. This could include:
• Producing guidelines and identifying good practice - perhaps through case studies.
• Provide role models of companies where women are in board positions.
• Encourage companies to adopt Key Performance Indicators ( KPIs) to measure the extent to which organisations are good places to work, and are nurturing organisations - this would help increase the numbers of women who want to go onto boards as they would see that this is a place where they could make a contribution.
• Interventions that provide support for companies (for example through Business Gateway) should support efforts to improve board diversity.Their work with companies provides important opportunities for the issue to be discussed with companies that might otherwise not have considered it.

Key Messages

1.At a policy level, there are three established approaches to improving the gender balance and broader diversity of private sector boards:

• Setting quotas for the number of women on private sector boards.Over 20 countries have adopted quotas and whilst they are effective in changing the composition of boards, they are contentious with concerns that they can undermine women's achievements. In addition, the introduction requires appropriate supports to be in place and for sufficient time to be allocated to enable companies to achieve the quotas.
• Voluntary targets (sometimes referred to in the literature as coaxes) aim to increase the number of women on private sector boards without enacting legislation.This is the approach adopted by Scottish Government through Partnership for Change and the UK Government through the Lord Davies Review process.
• Corporate transparency requires companies to report on equality and diversity policies, initiatives and outcomes alongside other statutory reporting (such as financial reporting).This is intended to encourage companies to adopt approaches to improve the gender balance of their board - with some countries adopting a 'comply or explain' approach.

2.The vast majority of stakeholders and companies consulted during this research felt it was important Scottish Government does not impose quotas - as these could lead to inappropriate appointments, could lead to undermine the progress of women and in some cases impact on the sustainability of companies.Whilst there was broad support for the Partnership for Change voluntary commitment, some consultees expressed concerns it could become perceived as a qouta over time.

3.Turning to the approaches taken by companies themselves:

• 29% of companies completing the e-survey had no policies or porcesses in place t address the gender balance f their bards.
• In general, mst cmpanies that had adpted plicies r prcesses t address the gender balance f their bards had nly put in place a small number f appraches.There is limited evidence f cmpanies adpting a cmprehensive apprach t tackling this issue.
• The mst cmmnly adpted plicies and prcedures all related t develping the pipeline - mentring and/r peer supprt fr senir managers t prepare them fr bard psitins, creating netwrking pprtunities fr senir managers and training fr senir managers t prepare them fr taking n bard rles.
• Few cmpanies appeared t be adpting prcesses r prcedures arund recruitment prcesses r placing greater pririty n imprving the gender balance f the bard (such as setting targets r reprting n balance in their annual reprt).

4.In terms of "what works‟, the factor that appears to be of most value to companies is commitment by the Board and/or Chief Executive to improving the gender balance of the board. The other factor that appears to have an important impact is the changing gender profile of the business (and to a lesser extent, the sector as a whole) with this leading to more women in senior management roles. Companies that are more gender equal at the board level (40% or more of board members are female) were much more likely to say that having policies and processes in place to improve board and staff understanding of equality, diversity and potential bias had been of value to them than those with fewer women on their board.

5.Other appraches identified in the case studies as being of value in improving the gender balance of boards included:

• Embedding efforts within wider HR policies - such as Investors in People.
• Developing flexible working arrangements to attract and retain females in senior management roles.
• Making board recruitment processes more transparent.
• Providing mentoring and peer support for new board members.

6. Few case study companies had any explicit policies, processes or procedures to help improve the broader diversity of their board . Where action was being taken, this tended to focus on gender rather than other protected characteristics.

7. Only half of the case study companies had accessed any external supports - and in many cases this was a relatively minor element of their approach. In general, both companies and stakeholders felt there was a lack of awareness of what support is available - meaning this resource is not being fully utilised. Concerns were also raised by some stakeholders about whether this support is sufficiently resourced and evaluated.

8. In terms of the support stakeholders and companies would value from Scottish Government, this included:

• Providing clear leadership on this issue - although to have credibility it was felt important that the public sector achieved gender balance and broader diversity on their boards.
• Increasing the focus on this issue - for example, highlighting research, using procurement to encourage companies to consider the gender balance of their board and encouraging companies to provide information on this (through accreditation).
• Putting in place supporting infrastructure to develop the pipeline of women and other individuals with protected characteristics in senior management roles. This includes working with young people around career choice and aspirations, improving the availability and quality of childcare and ensuring leadership development programmes are available.
• Providing guidance and tools (such as checklists and good practice guides) to enable companies to make progress on this issue. Where possible, these should be embedded into mainstream business development supports (such as Business Gateway, Scottish Enterprise and Investors in People).