The wrong way to promote women

WOMEN are half the population but only 15% of board members at big American firms, and 10% in Europe. This represents a squandered opportunity. Companies that fish in only half of the talent pool will lose out to those that cast their net more widely. There is also evidence that mixed boards make better decisions than monolithically male ones do (see article). When a board includes a variety of viewpoints and attitudes, the boss's bad ideas are more likely to be challenged.

Mindful of this, European countries are passing laws that would force companies to promote more women to the executive suite. A new French law requires listed firms to reserve 40% of board seats for women by 2017. Norway and Spain have similar laws; Germany is considering one. The European Parliament declared this month that such quotas should be applied throughout the EU. Viviane Reding, the EU's justice commissioner, says she wants European boards to be 30% female by 2015 and 40% by 2020.

There are two main arguments for compulsory quotas. One is that the men who dominate corporate boards are incorrigibly sexist: they promote people like themselves and ignore any talent that lacks a Y chromosome. Only force can change their chauvinist ways.

The second argument is more subtle. Talented executives need mentors to help them climb the ladder. Male directors mentor young men but are reluctant to get chummy with young women, lest the relationship be misconstrued. Quotas will break this vicious cycle by putting lots of women at the top, who can then offer their sisters a leg up.

There may be something in both arguments, but in most rich countries sexism and the lack of role models are no longer the main obstacle to women's careers. Children are. Most women take career breaks to look after them. Many care for elderly relatives, too. One study found that two-thirds of American women had at some point switched from full-time work to part-time or flexible time to balance work and family. Such choices should be respected. But they make it harder for women to gain the experience necessary to make it to the very top.

What is more, big companies are increasingly global. Many want a boss who has worked in more than one country. Such foreign postings disrupt families; many women turn them down. Many also prefer not to prolong their working day by networking after hours. And many, anticipating a career break at some point in the future, enter fields where their skills will not quickly become obsolete, such as law or human resources. Some lawyers make good chief executives. But firms often want people with financial or operational experience for the top jobs, and these fields are still male-dominated.

Quotas are too blunt a tool for such a tangled problem. The women companies are compelled to put on boards are unlikely to be as useful as those they place there voluntarily. Quotas force firms either to pad their boards with token non-executive directors, or to allocate real power on the basis of sex rather than merit. Neither is good for corporate governance. Norway started enforcing quotas for women in 2006. A study by the University of Michigan found that this led to large numbers of inexperienced women being appointed to boards, and that this has seriously damaged those firms' performance.

Flexibility, not force

A less coercive approach is preferable. Companies that want to attract the best talent must think hard about how to make work more family-friendly. Must managers meet their staff face-to-face every day? Technology makes telecommuting easier (and it facilitates networking beyond male-dominated bars and golf courses). Wise firms will strive to remove barriers for women. The proportion of women in top jobs may remain lower than governments would like, partly because prejudices about women and work have deep roots (see Economics focus). But firms that address the question most skilfully will win the talent war, and reap the rewards.