No one “promotes” to director. They invite him. You become a general manager after years in which bosses, peers and the board saw your performance closely. The first seat on a board of directors, on the other hand, is decided in a market without a ladder, without notices and with very few written rules.
There are entire libraries about the race for the position of CEO. As for how the boarding threshold is crossed, almost nothing. That’s why Professor Ruth Aguilera, from Northeastern and Esade, along with her IMD colleagues, surveyed 830 directors from 47 countries. This year we added 277 Latin American directors to the study, the vast majority of them from companies with owners.
The first finding will not surprise anyone who has ever had lunch with a controller. 95% entered because someone who knew them opened the door, almost always a shareholder or the president of the board of directors. Only 12% arrived through a formal process. In the rest of the world the network also rules, but in a region of concentrated ownership the rule becomes almost absolute. Let’s call it by its Chilean name: pituto.
“Among men, 37% said that what mattered most in their appointment was having been general manager. They came with other cards: having joined the management team, legal and compliance experience, technology or sustainability.”
There are those who, scandalized, ask to compete for each chair as if it were a position of Senior Public Management. I do not share that easy indignation. When the owner puts his assets at stake, he prefers someone he already trusts, and that is quite logical. The cost appears elsewhere. If the only door is the network, the talent that is not there simply does not exist.
And that’s where the most interesting thing appeared. 16% of women reached their first directory through a headhunter or a search process, compared to just 4% of men. Outside the region the gap is almost identical (about 18% versus 5%). No man in our sample mentioned a headhunter as the person who opened the door for him. Not one.
Credentials tell the same story. Among men, 37% said that what weighed most on their appointment was having been general manager. They arrived with other cards: having integrated the management team, legal and compliance experience, technology or sustainability. With about seventy women in the sample, each percentage point is a small number, so it is advisable to read these figures with caution, although the coincidence with the global study gives them quite a bit of weight.
Does the headhunter correct the bias or give women a separate lane? I bet both at the same time. Who decides which searches are handled? Who puts together the shortlist? Who makes the last call before the shareholders meeting? Almost always, the same president who previously filled the chair with an acquaintance. If a board hires headhunters only when looking for a woman, the problem has not been solved. He changed offices.
There is also good news. Before 2010, none of the directors in the sample reached their first seat through a formal process. Since 2018, 18% did so. And in the same period, the number of house executives who move to the board of directors fell from 46% to 22%. The market door already exists, although it lives almost entirely in open societies, where AFPs and other institutional investors ask for processes that can be explained.
If the board continues to ask for “a former general manager,” don’t be surprised when the shortlist comes in handy.
Source: www.df.cl
