How women can break into the boardroom

November 26, 2013, 9:20 PM UTC

At a time when colleges are graduating significantly more women than men, barely 17% of Fortune 500 company directors are female, and progress has stalled for the past seven years. This doesn’t make much sense.

One well-known corporate director stirred the pot last week, playing provocateur as I led a breakfast panel at a YPO (Young Presidents’ Organization) event in Chicago. Mellody Hobson, president of Chicago-based Ariel Investments, is on the boards of Starbucks , Estee Lauder , Groupon and DreamWorks Animation , where she is non-executive chairman. Hobson, in the audience for our discussion, posed a question to panelist Beth Comstock, General Electric’s chief marketing officer and head of the new Silicon Valley-based “GE Ventures”: Would GE Ventures, which aims to invest $250 million annually in tech companies, consider restricting its investments to startups that have female board members.

Comstock replied that GE would consider Hobson’s suggestion; she was sensitive, clearly, to controversies over Twitter and Facebook going public with no women on their boards. (Facebook, after its IPO last year, named COO Sheryl Sandberg to its board.) Hobson replied impatiently: “Every VC I’ve asked said they’ll ‘consider it.’”

I asked Hobson if Ariel invests in companies that have no female directors. “We put tremendous pressure” on companies to add women and people of color, replied Hobson, who is African-American. “Diversity makes better businesses.”

Former McDonald’s U.S. president Jan Fields, also on the panel, noted one challenge for CEOs seeking female directors: “A lot of companies don’t let their executives be on boards.” Only after leaving McDonald’s a year ago, Fields was able to join a second board, Chico’s , in addition to Monsanto . Like McDonald’s, GE lets its executives serve on one board. Comstock is a director at Nike .

Meanwhile, GE has five female directors. Chairman and CEO Jeff Immelt has strategically recruited women who had big jobs and now have time to serve as well as essential experience. The five women on the 18-person GE board include former SEC chair Mary Schapiro and ex-Avon CEO Andrea Jung.

My essay, “Is the boardroom the last glass ceiling?” in Fortune’s Most Powerful Women issue proposes three ways to improve the gender ratio in the boardroom. One more suggestion: Break the rules. At Fortune’s Most Powerful Women Asia conference earlier this month, Morgan Stanley China CEO Wei Christiansen told how she got on the Estee Lauder board despite her employer’s rules. A powerful man, Leonard Lauder, talked to the investment bank’s top bosses, CEO James Gorman and former chairman John Mack, and they got it done:

Hobson and other Fortune Most Powerful Women–Xerox CEO Ursula Burns. Facebook’s Carolyn Everson, Walt Disney’s Anne Sweeney, and Cisco’s Padma Warrior and more–talk about how they got ahead in “Breakthrough Moments in Leadership,” sponsored by ING .