Diversity on Boards

Abstract

Examinations of public company board composition have focused on the absence of women but rarely on the absence of visible minorities. Given an increasingly diverse domestic population and increased participation of second-generation immigrants in the professional cadre, we think that board diversity, and in particular visible minority directors (VMDs), warrants academic attention. Accordingly, in this study, we examine both women and VMDs on boards of firms listed on the Toronto Stock Exchange as well as in graduating classes of director education programs in Canada. Our preliminary analysis indicates that visible minorities represent less than 5 percent of the population in both cohorts while the percentage of women is much higher. By contrast, white women comprise 25 percent of DEP graduates and 14 percent of public company boards. We note the much lower representation of visible minorities relative to both white women and white men on corporate boards. We also examine the types of firms that are more likely to place visible minorities and women on their boards, noting that firms in certain industries such as mining and oil and gas have been historically less likely to have diverse boards.