Diversity in Boardroom: Success and Challenges

Running head: CORPORATE GOVERNANCE
CORPORATE GOVERNANCE
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Abstract
Experienced directors have highlighted that the CEO must be placed high enough in relation to
the others so that the director roles can be taken up actively. It has been assumed by the tenured
directors that the young directors will not have enough time. Younger generation directors have
the knowledge of the business technology, while at the same time the more matured and
experience directors have the advantage of the traditional skills. In several cases, majority of the
directors are experienced and mature and this experience will be required to fill the vacant spaces
in the boardroom and also in the later part of their job as they will have more time to spare.

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Contents
Introduction......................................................................................................................................3
Diversity entity which is more successful.......................................................................................3
Diversity entity which is less successful.........................................................................................6
Conclusion.......................................................................................................................................9
Reference.......................................................................................................................................10

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Introduction
In the world of the corporate governance, the board of directors have received a
considerable amount of attention. The companies that are headed by the diverse groups are found
to be more successful in comparison to the business environments that are complex. Therefore, it
is important to mention that the succession plans and the appointment plans need to promote
people from different ethnic backgrounds, social, personal strengths, cognitive and gender. The
term diversity in the boardroom provides a balanced board and the true essence of the board
governance. The Boardroom diversity includes individual that belong from differing careers,
experiences, competencies, thinking and terms of skills (Hafsi and Turgut 2013). A major benefit
of having a diverse boardroom is that diversity leads to effective decision making. It is important
to note that diverse boardrooms have different experiences, background and skills. The presence
of diversity will provide a thoughtful and considerate decision making allows the boardroom to
have a comprehensive oversight. When a boardroom is diverse and well structured, then it
possesses the capabilities of foreseeing the risks and the challenges. Therefore, diversity in the
board room leads to effective risk management and this enable the boardroom to effectively
tackle the difficult situations (Hillman 2015). In this study, a critical review of the diversity in
boardroom will be done, along with the findings and recommendations.
Diversity entity which is more successful
According to the Annual Corporate Directors Survey, it has been found that the diversity
in age plays a vital part in having diversity of thought it has also been highlighted by 90 percent
of the directors. In fact, the survey showed that age diversity is highly vital in comparison to the
other elements like the race and gender. The average age of the directors is moving up and on an
average the directors are above 63 years of age. It has been seen that the directors that are