Corporate Diversity 2.0 – Lessons from Silicon Valley’s Missteps
Oregon Review of International Law Vol 20 Issue 1 2018
74 Pages Posted: 16 May 2018 Last revised: 14 Jun 2018
Date Written: April 30, 2018
Diversity, especially gender diversity, in the corporate world seems like an idea whose time has come. We saw the issue of gender diversity on corporate boards take centre stage after the financial crisis with States introducing both hard and soft laws in this regard. However, the recent incidents at Uber, the poster child of the start-up world, which ultimately led to the resignation of the founder CEO and a board member, shows that gender diversity efforts must be re-thought. Further, derivative actions and shareholder letters against Twenty First Century Fox and Amazon respectively show that diversity and related issues of harassment, discrimination and inclusion have to be prioritized as significant issues by company boards.
This article reviews the current laws and regulations on corporate gender diversity across countries and finds that there are two separate problems that they seem to be addressing. The first problem is that of board effectiveness being hampered by homogeneity. The second problem is that of gender equality in the corporate context. However, since neither of these issues is clarified individually, the measures taken fail to appropriately address them. Instead, there is a conflation of both problems and the resulting regulations only propose superficial solutions.
To remedy this, this article makes the case for a new regime for regulating each of these problems, or, in other words, a move towards ‘corporate diversity 2.0’ which offers appropriate solutions to each of the two problems. The article also argues that the problem of ‘gender equality’ should be framed more broadly as equality at the workplace. This article will then build on some of the diversity-related recommendations of the Holder Committee set up by the board of Uber, to ensure that diversity efforts do not merely stop at the level of the board, but instead aim to make workplaces at various levels more diverse. Ultimately, workplace diversity efforts will not only help address some of the structural barriers that women and minority groups might face but also to ensure that diverse candidates are retained in the workforce, and are able to naturally progress into board roles.
Keywords: gender diversity, board of directors, corporate governance, equality, inclusion
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