Interrogating diversity: Feminism and the destructuration of Australian board appointment practices

• Published date: 01 July 2024
• Author: Claire Wright,Corinne Cortese,Abdullah Al‐Mamun,Searat Ali
• Date: 01 July 2024
• DOI: http://doi.org/10.1111/corg.12559

SPECIAL ISSUE ARTICLE

Interrogating diversity: Feminism and the destructuration of

Australian board appointment practices

Claire Wright

1

| Corinne Cortese

2

| Abdullah Al-Mamun

2

| Searat Ali

2

1

University of Technology Sydney, Ultimo,

New South Wales, Australia

2

School of Business, Faculty of Business and

Law, University of Wollongong, Wollongong,

New South Wales, Australia

Correspondence

Corinne Cortese, School of Business, Faculty

of Business and Law, University of

Wollongong, Wollongong, New South Wales,

Australia.

Email: corinne@uow.edu.au

Funding information

We have not received (and/or relied on) any

funding for this project.

Abstract

Research Question/Issue: How have social movements influenced the diversity of

Australian corporate leadership? Although board diversity is crucial for corporate

governance, the research in this topic is bifurcated between studies examining inter-

locking directorates and the presence of boardroom gender diversity.

Research Findings/Insights: In this study, we use a novel dataset and method to

understand board diversity. We integrate the analysis of social diversity (structural

connections) and demographic diversity among ASX50 boards in 2019 and 2023.

Social network analysis (SNA) reveals a closely connected corporate community, with

prosopography data identifying a narrow range of “acceptable”demographic

characteristics.

Theoretical/Academic Implications: We extend institutional theory by examining the

role of global social movements (GSMs) for the destructuration of board appointment

practices and the resulting uneven progress on equality. Activism from the global

feminist movement has applied multi-dimensional coercive and normative pressures

to develop a “pipeline”and “catalyst”for women's board appointments. Simulta-

neously, the absence of targeted action on other diversities and the intensification of

directors' professional requirements have institutionalized the group's social and

demographic profile.

Practitioner/Policy Implications: These findings are relevant to policymakers and

corporations, highlighting the role of social movements for disrupting the status quo

and the multidimensional institutional pressures needed to destructure entrenched

appointment practices.

KEYWORDS

corporate governance, board diversity, feminism, prosopography, social network analysis

1|INTRODUCTION

Board diversity is crucial for corporate governance, with directors

responsible for monitoring, approving, and guiding company decisions.

Board diversityhas attracted significant public,regulatory, and research

interest and has been found to be important for reducing “groupthink”

and encouraging better monitoring, oversight, and decision-making

(Adams & Ferreira, 2009;Guest,2019;Kagzi&Guha,2018;Rao &

Received: 14 October 2022 Revised: 15 August 2023 Accepted: 18 August 2023

DOI: 10.1111/corg.12559

This is an open access article under the terms of the Creative Commons Attribution-NonCommercial-NoDerivs License, which permits use and distribution in any

medium, provided the original work is properly cited, the use is non-commercial and no modifications or adaptations are made.

© 2023 The Authors. Corporate Governance: An International Review published by John Wiley & Sons Ltd.

Corp Govern Int Rev. 2024;32:625–644. wileyonlinelibrary.com/journal/corg 625

Tilt, 2016b). It has alsobeen important for creating space for women's

empowerment generally, setting an exemplarymessage throughout the

organization and encouraging the education and career aspirations of

girls and women (Matsa & Miller, 2011). In response, many countries,

including Australia, have introduced mechanisms to improve board

diversity, including quotas, mandates, incentives, and “comply or

explain”procedures. For example, in Australia in 2010, the Australian

Stock Exchange (ASX) revised its Corporate Governance Principles and

Recommendationsto encourage firms to monitor, disclose,and establish

policies to improvethe number of women in corporateleadership.

Research on board diversity is bifurcated between those studies

examiningthe presence and structure of interlocking directorships (social

diversity)(Gray&Nowland,2017;Kiel&Nicholson,2003;Miglani

et al., 2020) or the presence of boardroom gender diversity (Agrawal &

Knoeber, 2001; Frijns et al., 2016; Griffin et al., 2019;Kagzi&

Guha, 2018;Post&Byron,2015). Although many studies have consid-

ered both individual drivers and organizational predictors of women on

corporate boards (Hillman et al., 2007;Nekhili&Gatfaoui,2013;

Sheridan et al., 2021), in this article, we examine the role of national,

regional,and global institutional structures for enabling and constraining

board diversity. Within this literature, the influence of global social

movements (GSMs) has been neglected, with research briefly gesturing

to the influence of public activism (Ghauri et al., 2021; Perrault, 2015;

Rose & Bielby, 2011;Spear&Roper,2013) and the introduction of regu-

latory initiatives (Clark et al., 2022; De Vos & Culliford , 2014;Huse

et al., 2011; Seierstad & Opsahl, 2011). We contribute to these efforts

by examining a broad range of diversity categories (gender, ethnicity,

age, and class) alongside social diversity in the form of interlocking

directorates. We then extend research on the local translation of GSMs

by examining the progress of multiple types of board diversity in

Australia compared to the progress of their relevant activisms.

To understand the role of GSMs on the destructuration of minor-

ity corporate leadership appointments, we examine two cohorts

(2019 and 2023) of board members of ASX50 companies. We use

social network analysis (SNA) to analyze social diversity through con-

nections across ASX50 firms and directors based on interlocking

directorships. We then examine prosopography—or collective life

history—data on director's gender, age, ethnicity, and professional

career path to understand the group's demographic diversity.

This paper will progress as follows. In Section 2, we review the lit-

erature relating to the importance of board diversity and the role of

GSMs for disrupting appointment practices. In Section 3, we outline

our theoretical arguments, considering the external institutional iso-

morphic forces that drive “sameness”in Australia's director commu-

nity and the role of GSMs for “destructuring”appointment norms. In

Section 4, we discuss our data and methods for understanding social

and demographic diversity. Section 5includes the empirical results,

where we find an identifiable corporate community among the

ASX50, with most boards and directors connected within the same

cluster, sharing multiple connections to one another, and limited con-

nections to other groups. Directors' social sameness is combined with

demographic sameness, with a narrow range of “acceptable”demo-

graphic characteristics in the corporate community.

Interpreting the empirical results, Section 6concludes that the

relative importance of women in top company boards is the culmina-

tion of decades of feminist activism, which developed a “pipeline”of

women with the necessary qualifications and experience and then a

“catalyst”to their board appointments. In contrast, the absence of tar-

geted action on diversity other than gender and the intensification of

directors' professional requirements have institutionalized the group's

social and demographic profile. These findings make a theoretical con-

tribution, extending institutional theory by highlighting the reliance on

GSMs for destructuration of board appointment practices and the

resulting tension between strides made in equality in some domains

against increased homogenization in others. These findings are also

relevant to policymakers and corporations, highlighting the way insti-

tutional forces entrench appointment practices and the role of GSMs

for disrupting the status quo.

2|LITERATURE REVIEW

The last four decades have witnessed a significant increase in public,

government, regulatory, and media interest in the composition of cor-

porate boards (Armour, 2020; Fairfax, 2005; Groutsis et al., 2018;

McDonnell & Cobb, 2020;Rao&Tilt,2016a). Although board diversity

can manifest in several different ways, research in management and

corporate governance has largely considered demographic diversity, or

the representatio n of population-level differences su ch as gender, age,

class, ethnicity, and sexuality. Research has examined the gender com-

position of boards,the appointment process, andcompliance with regu-

latory conditions (Agrawal & Knoeber, 2001; Farrell & Hersch, 2005;

Frijns et al., 2016; Griffin et al.,2019; Hutchinson et al., 2015;Kagzi&

Guha, 2018; Post & Byron, 2015;Singhetal.,2015;Torchia

et al., 2011). There is a limited range of research that examines ethnic

diversity in corporate leadership (Abebe & Dadanlar, 2021; Azmat &

Rentschler, 2017; Brammer et al., 2007; Carter et al., 2010;Fredette&

Sessler Bernstein, 2019;Guest,2019; Upadhyay & Zeng, 2014). Some

have acknowledged that diversity is much broader than gender; how-

ever, there is very little research that documents a range of diversity

dimensions (Frijns et al., 2016;Kangetal.,2007;Rao&Tilt,2016b;

Vinnicombe et al., 2008). Australian research has largely followed the

internationalliterature, examining gender, withvery little work on other

demographic diversities (Ahmed et al., 2018; Ahmed & Ali, 2017;

Gyapong et al.,2021;Hutchinsonetal.,2015; Strydom et al., 2017).

Board composition refers to the mixture of skills and experiences

among a team of directors, withdiversity seen as important for reduc-

ing “groupthink”and encouraging better monitoring, oversight, and

decision-making(Dalziel et al., 2011;Guest,2019;Kagzi&Guha,2018;

Rao & Tilt, 2016b). While most board diversity research has examined

demographic diversity, work has also acknowledgedthe importance of

social and professional connections for board diversity. The relative

proportionsof executive and non-executivedirectors, outside directors,

and directors with multipleinterlocking board roles indicate conflictsof

interest and the degree of distinctiveness of directors' social contacts

and knowledge resources (Ahamed, 2014; Buch-Hansen, 2014;

626 WRIGHT ET AL.