I would like to begin by clearly stating that I know absolutely nothing in regard to running an artistic or cultural organization. In preparing for this meeting I realized I am considered the equivalent of a director on a board for such an organization, but that does not imply knowledge. Rather, I am a professor of economics.
My research focuses on labour markets and policy, including gender wage gaps and women's participation in the labour market. I also teach economics and gender at Laurier. With that background in mind I wanted to speak more generally about women's representation in leadership positions.
I'm not aware of any formal Canadian statistics regarding the representation of women on boards of artistic and cultural organizations. We know women's representation on TSX-listed boards is low. According to recent reports, women hold roughly 15% of board seats in these companies. The impression I have is that artistic and cultural organizations have better representation of women on boards, but may not have a fair representation of women in top leadership positions.
Gaining better information about artistic and cultural organizations will require standardized reporting. For example, the Canada Revenue Agency could require organizations with charitable status to report the gender of members of the board of directors as public information, adding to the information already reported. With this information, if we see women under-represented, what should we do about it?
Gender quotas are often the first thing that comes to mind, and economists have now had a chance to study a few examples. An excellent example is a paper published in the American Economic Review titled “Gender Quotas and the Crisis of the Mediocre Man”. I have to say I love the title of this paper.
The author studied elections in Swedish municipalities where the council is appointed by proportional representation implemented through party lists. Starting in 1993 the Social Democratic Party lists were subject to zipper quotas whereby party lists had to alternate male and female names throughout their list of nominees. The party seats are then filled according to this list, ensuring representation of women among the seats that are won.
This zipper quota clearly resulted in a higher share of women elected. More importantly, it resulted in an increase in the level of competence among the elected officials, which mainly reflects an improvement in the selection of male candidates. Put simply, mediocre men appeared to be removed from the party lists, especially in leadership positions, and replaced by highly competent women.
One reason I like this paper is it speaks to the main point of opposition to gender quotas. That is the concern that it threatens the selection for leadership positions based on merit. This paper reminds us that many other factors drive appointments, which may not be optimal.
Norway's gender quotas for corporate board membership introduced in 2006 have received more attention. We see evidence that changing the composition of boards will affect corporate strategy. For example, Norway's affected corporations appear to avoid short-term workforce reductions, which affects short-term profits; that may be important as part of a long-term strategy. The same study, however, found that other aspects of corporate decisions affecting revenues and non-labour costs were unaffected.
We also see evidence from Norway, however, that gender quotas for boards may not have much effect beyond board composition. The quotas do not appear to lift the position of women not appointed to boards or alter the decisions of young women who are planning their careers in business.
When we look at the broader literature, the evidence suggests that gender quotas that change the composition of boards can affect the strategy of an organization. Those effects may be small, but I have not seen convincing evidence to clearly suggest it is negative. Gender quotas may raise competence levels in an organization. However, we must remember that policies such as gender quotas are only one small piece of that policy puzzle.
I thank you for your attention, and I would be happy to answer any questions you may have.