Director diversity and inclusion: At the table but in the game?

Abstract

The issue of the presence of diverse directors on boards has attracted considerable attention among policymakers, practitioners, and academics. There is relatively less attention to the inclusion of diverse directors, or their onward trajectory after appointment. We study two outcomes related to inclusion—the retention of directors and their promotion to board leadership positions. Although gender is a key focus of many diversity discussions, we find significant inclusion results on skill diversity and nongender diversity dimensions. Retention and promotion are “less” likely for age- and ethnicity-diverse directors but both outcomes are more likely for skill-diverse directors.