Diversity in the boardroom. Facts and possibilities.

Diversity in the boardroom. Facts and possibilities.

In Norway, we have over 700,000 board members, but who are they and what characterizes them? In this article, we have chosen to focus on Norwegian limited liability companies (AS), as this is where the volume is greatest.

Sex

In Norwegian joint-stock companies (AS), the board members consist of 80% men and 20% women. As many as 70.6% of the companies only have men on the board, 9.1% only have women and only 20.3% have both sexes represented. There have been virtually no changes to this development in recent years. 

Number of board members

49.9% of the companies consist of 1-2 board representatives, testifying that a large proportion of Norwegian limited companies are represented by those who started and own the company. 38.5% of the companies have 3-4 board representatives, and 9.2% have 5-6 representatives on their board. Only 1.8% has more than 7 representatives on the board.

Industries

There are some industries where women are poorly represented in the boardroom. This applies, among other things, to the construction industry, where only 17% of the companies have women on the board. Agriculture, forestry and fishing have 26%. The industries with the most women on the board are respectively public administration and defense with 63.2% women, health and social services with 57.9%, education with 48.9% and culture, entertainment and leisure 42.2% women on the board.

Cultural background

Looking at ethnicity then has the whole 87.7% of the chairmen Norwegian background. If you add the Nordic countries, the figure becomes 92.1%. 5.1% has other European backgrounds and only 2.8% has its origin from countries other than Europe, at chairman level.

If you look at board members, 90.5% have a Norwegian background and 3.1% other Nordic backgrounds. 3.7% has a European background and only 2.2% has a background from countries other than Europe.

Age and time on the board

Unfortunately, there are no public statistics on the age of chairmen and board members in Norway, although we have requested this. Another interesting figure would have been an overview of how long one holds office as chairman and board member, while at the same time we would like to have an overview of how many people gain and lose board positions per year - so that we can say something about the frequency. But unfortunately this is also not possible - as of now.

Possibility

In the coming years, businesses will be faced with a number of challenges and opportunities, both in terms of changed competitive conditions due to a more globalized world, access to new technology that can revolutionize entire industries and businesses. A lot is happening on privacy and how to deal with and use data, not to mention how the use of AI and automation will change business models, industries and businesses to a large extent.

In order to stay up-to-date and for businesses to seize the opportunities that exist, the board should possess a minimum of competence - to simply keep up with developments.

In Aboard, we have now recruited close to 1,000 board candidates with diversity in both gender, age, cultural background, competence and experience. We know that many recruit in their personal network (closer to 90%) because it is so easy. Simple, on the other hand, does not mean that it is the best for the business, and our research shows that boards where many of the representatives are the same create less value creation - than boards that consist of diversity.

Boards must have a culture where diversity is seen as a strength, and not a threat. Only then will you have a value-creating board that lifts, develops and manages the business in a good way.

We have the candidates that businesses need, and we need businesses to understand the need to bring in new, independent and diverse board members and not just friends and acquaintances.

Stogether, we can create a diverse and value-creating board that can meet the challenges of the future in an optimal way.