The following article is cross-posted from Unwritten Rules with permission of the author. The opinions expressed herein are those of the author, and not necessarily those of The New Agenda.

First published in The Glass Hammer July 7, 2010

One definition of insanity is to do the same thing again and again and expect a different result.

If we want more women in senior leadership positions we need to take a different approach. The current one isn’t working.

We’ve repeatedly called on Board Directors and C-suite executives to act on the strong business case for appointing more female colleagues, with minimal impact.

The 2009 Catalyst Census of Fortune 500 Women Board Directors revealed that less than one fifth of companies have three or more women on their boards, and more than 40 percent have no women directors whatsoever.

At the last count, women comprised only 15.2 and 13.5 percent of board directors and corporate officers respectively in Fortune 500 companies.

The United States is not alone in its boys club mentality.

Canada’s Financial Post 500 companies have only 14 percent female board directors, and 16.9 percent corporate officers.

Similarly, women hold only 9.7 percent board positions in Europe’s top 300 companies.

Research shows companies with at least three female board members, and more women in senior leadership roles, produce stronger-than average financial and organizational results. But the boys at the top just aren’t buying it.

It’s time to stop banging our heads against the same brick wall and instead, think more broadly about where we might influence change.

Mobilize shareholders

One fairly untapped area of influence is shareholders of publicly quoted companies. These people, whether they be individual investors, or fund managers, have the right to demand the best possible management of the organizations in which they invest.

Are shareholders aware that companies with three or more women on their board have stronger organizational performance and healthier bottom line results?

Do they know that a 2007 Catalyst report, The Bottom Line: Corporate Performance and Women’s Representation on Boards, shows companies with more female board members outperform those with the least on:

• Return on equity (by 53%)
• Return on sales (by 42%)
• Return on invested capital (by 66%)

Might they be interested in research done by Professor Michel Ferrary (CERAM Business School, France) in 2009, showing companies with a higher ratio of women in management coped more successfully with the global financial crisis?

Ferrary’s study looked at 32 major companies in the CAC40, comparing the ranks of female managers to the performance of the company. Firms with high ranks of women managers all performed better than the CAC40 average.

Boards fail to take corrective action

Boards of directors are legally responsible to choose management teams and chief officers, oversee their performance and generally act prudently to increase share value.

If gender-balanced leadership is good for business (and it seems increasingly likely that it is), then directors should recruit more women to the boardroom, and ensure that CEOs have gender diverse senior management teams.

But are they? The short answer is no.

The good news is, we can do something about it.

Forward an open letter to every shareholder you know

I have a vision of shareholders demanding from their directors at least 40% women leaders on their boards and in their senior management teams.

To that end, I have written an Open Letter to Shareholders. It makes a strong case for gender balanced leadership at the top of the companies in which shareholders invest.

Read the letter. If you like it, please forward it to all the shareholders you know (and remember, if you invest in a pension you are a shareholder.)

Let’s join forces, take action, try a different approach and help create better leadership and better organizations.