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Board Diversity - How Important is "Critical Mass?"

Professors at UNC Chapel Hill and Duke University Law School recently published a paper describing and analyzing the results of data collected form corporate directors on whether an how board diversity matters.  The paper and survey go further than previous studies on the topic to explore whether "critical mass" in board diversity, as opposed to "token" diversity,  produces different boardroom decisions or outcomes.  The professors conclude based on their surveys and interviews that the data collected do not reflect significantly different boardroom outcomes resulting from a critical mass of diverse directors.

According to the paper's abstract: 

In this article, we report and analyze the results of forty-six wide-ranging interviews with corporate directors and other relevant insiders on the general topic of whether and how the racial, ethnic, and gender composition of corporate boards matters. In particular, we explore their views on the concept of “critical mass” – that is, the theory that women and racial or ethnic minorities are unlikely to have an impact in the boardroom until they grow from a few tokens into a considerable minority of the board. In contrast to other recent qualitative research on corporate boards, we find more limited support among our respondents for critical mass theory. Though some female respondents expressed the view, consistent with critical mass theory, that having more women on the board increased their comfort level and eased some of the stresses associated with being the first and only female, this narrative is in tension with our respondents’ apparent embrace of their first and only status. Moreover, with the possible exception of employee relations, our interviews largely fail to support the theory that a critical mass of female directors will produce different, and distinctly feminine, boardroom outcomes.

The study and paper were conducted and authored by Lissa L. Broome, University of North Carolina (UNC) at Chapel Hill - School of Law; John M. Conley, University of North Carolina (UNC) at Chapel Hill - School of Law; and Kimberly D. Krawiec, Duke University - School of Law.  The full text of the paper may be obtained at:  http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1781064