Firms need women, tech-savvy directors to spur growth, urge experts

Companies need to have digital-savvy members on their boards of directors to achieve growth in present times, a new global survey on 1,800 firms conducted by Grand Thornton has shown.

The findings could suggest the need for urgent revision in the composition of the overall decision-making organs of corporations to include more of the younger generation. In Kenya, the recommendations could relate with several top firms whose boards are dominated by old men.

“Lack of digital savvy in the boardroom is a glaring hole. Digital has disrupted markets, and the way we do business, but it hasn’t yet changed boards,” said Kamal Shah, the managing partner of Grant Thornton Kenya. Harnessing the benefits of the digital sector at a strategic decision-making level is vital to firms that have an interest in exploiting technology to drive growth, he added.

The research, covering companies in 36 countries, had sought to find the views of business executives. Sixty-two per cent of the respondents felt that having knowledge of current trends such as the use of social media to drive business was an important factor.

Further, 86 per cent of the interviews felt that the board of directors should be in a position to challenge the management by bringing new ideas to the table. Still a majority raised concerns about the lack of technology experience among board members and that posed a threat to their businesses. The consultancy firm also found that a gender-balanced board was likely to be more productive and was able to generate better ideas. Single-gender boards were likely to succumb to groupthink, Grant Thornton found, because diversity of ideas would often be missing.

“Diversity means more than just gender – diversity of culture, background, knowledge and thought are all important. But doing more to ensure a better blend of men and women sit at the top table, by creating better opportunities for women to progress, would be a giant step in the right direction,” the firm reports. In its research, only a sixth of company directors globally were women, while more than two thirds of business leaders believe female director do an effective job of encouraging diversity.

The Capital Markets Authority has implored upon listed companies to increase the number of women on the boards of listed companies in Kenya, with a target of having at least a third of the seats reserved for female directors.

Shah concludes that lack of diversity has an impact on performance citing that groups who are the same think the same.