Good morning, Broadsheet readers! Payments to moms improve babies’ brain function, investors like the sound of a Kohl’s takeover, and a finance executive gives a lame excuse for poor board diversity. Have a great Tuesday.
– Board of it. A warning to corporate leaders: If your board of directors is not yet at or near gender parity you should be prepared to explain why, and—pretty please—come up with a better answer than Lee Chang-ken.
The president of Cathay Financial Holdings told Bloomberg recently that the board of Taiwan’s largest financial company includes 12 men and one woman because he can’t find qualified female directors.
“We know we need to increase female board members, but we dare not do so if there are no right candidates,” he said. “The chairman told me to look for ideal female candidates for independent directors, but I can’t find any.”
Lee said his options are limited because many female candidates he would choose are often disqualified from sitting on Cathay’s board for two years or more because they’ve worked for companies Cathay conducts business with.
To be clear, other Taiwanese corporations have managed to scrounge up qualified women—a fair number of them, in fact. Sixteen percent of directors at other financial companies in the region are women—far too low a share but still better than Cathay’s 8%.
We used to hear Lee’s defense—also known as the pipeline problem—much more than we do now. That’s because the demand for greater diversity on boards—from institutional investors, lawmakers, investment banks, and exchanges—has forced companies to face facts: the problem is not the available pool of women candidates; the problem is the search process itself.
Under fire to add female directors, boards have tweaked their outdated criteria for directors. For instance, they’ve eased the expectation that directors have prior CEO experience. A 2019 PwC report found that 24% of new independent younger directors were current or former CEOs, compared to 37% of existing board members. Boards are also growing in size to add directors from more diverse demographics and backgrounds. And it seems boards’ current (mostly white, mostly male) directors are finally looking beyond their own (mostly white, mostly male) networks when they have to replace their peers, and —voila!—finding female directors and directors from non-white groups.
The process remains far from perfect. The share of female directors in the S&P 500 only hit 30% for the first time last May. But, at the very least, most boards recognize that substantive action is needed to increase diversity and that Lee’s “Welp, no women here” excuse isn’t gonna cut it.
The Broadsheet, Fortune’s newsletter for and about the world’s most powerful women, is coauthored by Kristen Bellstrom, Emma Hinchliffe, and Claire Zillman. Today’s edition was curated by Emma Hinchliffe.
ALSO IN THE HEADLINES
- Baby steps. A new study finds that providing low-income mothers with cash stipends for the first year of their children’s lives changed babies’ brain activity, with the children exhibiting stronger cognitive development. The study could have broad implications for U.S. social safety net policy. NYT
- Sale of the season. After multiple activist investors started circling Kohl's, the retailer led by CEO Michelle Gass, the apparel chain's shares rose 30%. Investors like the idea of a takeover by private equity firm Sycamore or Starboard Value. CNBC
- COVID canceled. Another bride has had her wedding plans canceled by COVID. This time, it's New Zealand Prime Minister Jacinda Ardern. The 41-year-old PM called off her ceremony after instituting new measures meant to curb the Omicron variant in the country. Of canceling her wedding, she says, "Such is life." Slate
MOVERS AND SHAKERS: At Reddit, Carla H. McIntosh is now VP of global talent acquisition; Anna Soellner is VP of communications; and Mary Ann Belliveau is VP of North America large customer sales. I AM ALS named Laura Dalle Pazze its new CEO. Ambrosia Vertesi joined Ironclad as chief people officer.
IN CASE YOU MISSED IT
- Go Amy, Go. Amy Schneider's hot streak on Jeopardy! continued on Monday as the engineering manager won her 39th straight game, the second-most ever for the trivia show. She now trails only Ken Jennings, the show's current host, who won a whopping 74 games in a row in 2004. Today
- MPs and 'Muslimness.' In the U.K., Conservative MP Nusrat Ghani says she was fired from her position as junior transport minister because her "Muslimness was raised as an issue." Prime Minister Boris Johnson says the Cabinet Office will conduct an inquiry into the allegation. Axios
- Dance break. A new organization called the Dance Data Project is pushing for gender equality in ballet. The nonprofit is measuring the gender gap that persists in roles like choreographer and artistic director, even as women populate the ballet world's stages. During the 2020-2021 season, 69% of all ballets programmed at the 50 largest U.S. companies were by men. NYT
ON MY RADAR
The internet is failing moms-to-be Wired
The genius of Toni Morrison's only short story The New Yorker
Taylor Swift slams Damon Albarn over claim she doesn’t write her own songs: 'false and so damaging' Variety
"People won’t always ask you to share your story, but that doesn’t mean that they don’t need to hear it."
-Alexandra Huỳnh, 19, the National Youth Poet Laureate
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