Rosemary McCarney a former Wall Street lawyer with an MBA, runs a $500-million-a-year Canadian not-for-profit organization with more than 200 full-time employees.
Yet, the president and chief executive officer of Plan Canada, which helps children living in poverty around the world, had never considered putting her name forward as a director of a major corporate board.
McCarney is one of this year’s “Diversity 50,” a list of highly qualified, carefully vetted executives, all hoping to make the leap to an FP500 board.
They just a got big boost from Canada’s largest stock market regulator.
The Ontario Securities Commission, along with six provincial and two territorial securities regulators, announced new rules Wednesday aimed at encouraging companies to appoint more women to their boards.
“It’s a really significant step forward in the right direction,” said McCarney. “The data show it’s not only the right thing to do but it’s good for corporations as well.”
The regulatory move comes amid growing pressure from major investors, like the Ontario Teachers’ Pension Plan, and women’s organizations to get more women on the boards of Canada’s largest publicly traded companies.
Canada’s boardrooms, in the words of Scotiabank chair Tom O’Neill, are largely “male, pale and stale,” said Pamela Jeffery, founder of the Canadian Board Diversity Council, which created the Diversity 50 List.
Appointed near the end of their day-to-day corporate careers, corporate directors are mostly white men, and because there are no term limits, they’re often still there in their 70s, creating little room for fresh blood, Jeffery said.
Only 6 to 8 per cent of the just over 3,770 seats at the FP500 — Canada’s 500 largest publicly traded firms — become available each year.
The result is that progress in diversifying Canada’s corporate boardrooms has been “glacial,” Jeffery said, who founded the council in 2009 to try to speed up the pace of change.
The number of seats held by women has inched up to 15.6 per cent from 13 per cent, she said, but other groups are barely represented. Aboriginals held 1.3 per cent, visible minorities 3.4 per cent and people with disabilities 2.1 per cent, according to the council’s annual scorecard in 2013.
Too often, when a seat does become available, corporate directors turn to each other for nominations, Jeffery said. “Who do you know?”
The Diversity 50 list is one way of trying to close the gap by helping companies connect with non-traditional pools of talent, Jeffery said.
The list is composed mostly of women, but also includes visible minorities, aboriginals and people with disabilities, she noted.
Among them is Jean Paul Gladu, president and chief executive officer of the Canadian Council for Aboriginal Business.
Gladu brings an executive MBA and a forestry degree to his aboriginal perspective on business, which he says could benefit Canada’s resource companies in an era when so many major projects are located within aboriginal communities.
“We’re running out of time for many of our major resource projects. If we don’t get these relationships right, the impact is going to be significant,” Gladu said in a recent interview in Toronto.
The challenge many women face in landing board seats is their resumés don’t read like a traditional linear climb up the corporate ladder, said McCarney.
“There are gaps. There are some lateral moves. There’s some in and out,” she said, noting women may take time off to raise children, or help aging parents, or were transferred with their partner.
Her own decision to go into the not-for-profit sector raised some eyebrows after a successful career on Wall Street and in the tech sector, she said. “What is it, a step away, a step out, a step back?”
But McCarney, who’s also eyeing a resource board seat where her extensive international travel could help with mining and other projects in remote communities, says it’s just a different way of getting to the same destination.
For aboriginal Canadians, the challenge is partly a lack of role models and partly corporate Canada’s lack of knowledge about aboriginal people, Gladu said.
“There was never a map forward for us to get there,” Gladu adds. “When you look at the board compositions, you don’t see many brown faces at the table.
“I think a lot of it is fear based,” Gladu said of corporate Canada’s perception of aboriginal people. “And they just don’t know us. They think we don’t have the capacity.”
Candidates for the Diversity 50 list are vetted by the consulting firm Deloitte, using criteria supplied by 12 Canadian CEOs and a leading global governance ratings research firm.
Past lists have included a retired RCMP commissioner, a former Hydro One president and a prominent retail consultant.
To date, 10 candidates have landed seats on an FP500 board, and one also landed a seat on a Fortune500 company, Jeffery said.
“We’ve had tremendous early results,” Jeffery said. “We’re very excited about that.”
But, in some industries, there’s still a long way to go, she said.
Canada’s largest sector — oil and gas and mining — has the worst track record on board diversity. Out of 673 total seats, only 9.7 per cent are held by women, Jeffery noted.
“Until we get more diverse candidates onto resource boards, we’re not going to catch up to the rest of the world with respect to diversity on corporate boards,” Jeffery said.
Among this year’s Diversity 50 list, which is published on the council’s website, are:
Laurel Broten, former Ontario cabinet minister.
Sadia Zaman, executive director, film, former director original program content, CBC.
Maureen Quigley, consultant, former policy and planning adviser at Metro Hall and Ontario government.
Rhonda Lawson, senior vice-president, Genworth MI.
Shanti Gidwani, national senior director, Healthcare, Cisco Systems.
Marie Delorme, chief executive officer, The Imagination Group
Carmine Rossiter, program director, Schulich Executive Education Centre.
Janice Peleshok, consultant, former pharmaceutical industry executive.