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Many corporate directors are members of an "old boys" network and appear to have been cut out with a cookie cutter--they are male and white. The typical selection process is flawed[1].
Although relatively little research attention has been devoted to the topic of corporate boards of directors, interest in this area is growing. There are several reasons for this: increasing interest in questions of corporate governance and who is responsible for controlling corporations in a democratic society; criticisms by the media and stockholders during the 1980s of specific decisions made by boards of directors and the generally low performance levels of companies; and a lowering of the. veil of privacy or secrecy regarding corporate boards and Chief Executive Officers (CEOs)[2].
There has been considerable change in the purpose and relevance of corporate boards over the past few decades. Historically, many board appointments, as well as boards themselves, seemed to have only symbolic value. Individuals were appointed to boards, but the CEO managed the organization in whatever fashion he/she chose. Mace[3] referred to corporate directors as "ornaments on a corporate Christmas tree". Boards were often irrelevant because board members refused "to rock the boat"[4]. As a result of these factors, recent writing on corporate boards has devoted attention to improving their performance[1,5,6,7],
Another, and perhaps related, area of change involves criteria for board membership and ultimately the composition of boards themselves. Historically, the vast majority of board members were white males, over 55 years of age, who were CEOs. There were several reasons for this. It is an acknowledged fact that people prefer the company of others who are like themselves. In addition, CEOs brought considerable experience, perspective, knowledge and ability to the board. Finally, potential board members who were "different" were both few and invisible to most CEOs.
The composition of corporate boards is slowly changing. This has happened for a variety of reasons. First, there are not enough CEOs to go around. Second, CEOs do not have enough time to serve on all the boards they are invited to join. Third, groups of potential board members (women, minorities) are developing the necessary experience, track records and abilities to compete successfully with white males for board memberships. Finally, these groups are now becoming more visible...