For more than two decades, Los Angeles business woman Betsy Berkhemer-Credaire harboured a dream. This past January, that dream — and all the hard work that went into it — came to fruition when California enacted the SB 826 Law which requires publicly traded firms in the state to place at least one woman on their board of directors by the end of 2019 — or face a penalty; companies with five directors to add two women by the end of 2021; and companies with six or more directors to add at least three more women by the end of the same year. What did it take to make it happen? What were the obstacles? What were the lessons? In a recent conversation with Aspire Editor Gayle Jo Carter, we learned all that and more from Berkhemer-Credaire, a successful entrepreneur who turned $800, a phone and a typewriter into one of the largest independent public relations agencies in Los Angeles.
Q. How did you turn your ‘Women on Corporate Boards’ dream into a reality?
It was strictly an amateur approach to start out with. I met with legislators and asked, ‘How do you design a law?’ After all, Norway and Sweden have had a law since 2006, now Germany and France have a law. So, why can’t California? We have more public companies than any other state in the Union, 438 to be precise, that are on the Russell 3000 index – that’s more than New York, New Jersey and Connecticut combined. We should be the state leading this effort. And by golly, the legislators, the women legislators, understood the value of the research that I and my National Association of Women Business Owners of California showed them, which was the business case for having at least three women on corporate boards: companies run better, they are more profitable, they perform better and the workforce is better engaged. So why not give it a try?
Q. If you have proof, it’s hard to argue, right?
It certainly is. I’ve studied the issue – but I knew in my heart of hearts. I studied the issue for 17 years and then it took 7 years to put the bill together. First, we had to do a resolution in 2013. A resolution is like a warning shot fired over the bow and it’s passed by both Houses. It’s just like a law but it doesn’t have any enforcement, there’s no fine with the resolution, there’s no arresting the CEO who doesn’t have women on the board. But five years later, we were able to get the law passed and that requires a $100,000 fine for the first year and $300,000 fine by year three. There’s a lot of incentive for the old boys to add at least one woman to their boards this year.
Q. Tell us the significance of the Bill’s number that became the California Board law.
The number we chose for the bill, SB 826 — same date as the date when women got the right to vote back in 1920 — it was August 26, memorable and meaningful and 100 years ago. That is also why we and the co-founders of 2020 Women on Boards focused on the year 2020 – 100 years after 19th amendment – in order to say, ‘Well gee, we ought to have 20%, at least, of women on boards by that year’. But of course, we’re probably not going to make it. Right now, the latest 2020 Women on Boards research shows17.7 % percent of all board seats are held by women, publicly held board seats, not private, that’s of the Russell 3,000.
[The Russell 3000 Index is a capitalisation-weighted stock market index, maintained by FTSE Russell, that seeks to be a benchmark of the entire U.S stock market. It measures the performance of the 3,000 largest publicly held companies incorporated in America as measured by total market capitalization and represents approximately 98% of the American public equity market].
Q. Who pushed back? What was the opposition?
The California Chamber did and they represent the businesses in California. The irony is that they represent mostly private company businesses. They pushed back saying that they did not want the government to be telling their companies what to do. But that’s an old hackneyed argument because they simply stayed with the times, but if they did what their shareholders needed done, they wouldn’t have to be forced. We didn’t want to force them into this position, but we had a resolution in 2013 and that didn’t move the needle at all in California. That’s why we were able to secure the law. We had gone as far as we could with the resolution. So, California Chamber pushed back hard and are still preferring that this would just go away. But it’s not going to go away – it is law as of January 1. A couple of other organisations that are large businesses, the California Manufacturer and Technology Association, again the same thing that they don’t want government to meddle in what they call their internal affairs. Again, we wouldn’t have to if it weren’t on behalf of the shareholders, the health of the business and the economy.
Our goal at 2020 Women on Boards is that in just a few years this will be such a thing of the past to have an all male, all Anglo board. It will be like a Model T Ford or dial phones. So many generations will pass and people will wonder why in the world things were like that. It’s just nonsensical. There have been threats, those particular organisations showed up at all of the hearings, all of the testifying that we did. They testified against us, the National Association of Women Business Owners of California. 2020 Women On Boards is a supporter, and there are many other 501C3 nonprofits supporting but only a 501C6 nonprofit, a business association, like the National Association of Women Business Owners of California, only they or a Chamber of Commerce, for example, can actually initiate laws and lobby for them because for 501C3s, all contributions to the organisation are tax deductible, like a Church or a University, you’re not supposed to be out there spending that money pounding the pavement for your own political advancement. We simply support it.
"Our goal at 2020 Women on Boards is that in just a few years this will be such a thing of the past to have an all male, all Anglo board. It will be like a Model T Ford or dial phones. So many generations will pass and people will wonder why in the world things were like that."
Q. How did you face the opposition?
Their excuse was simply businesses saying you can’t meddle with our business or force us to do anything and we simply back that up with ‘No problem.’ But if you were putting women on your boards which clearly the research shows — Credit Suisse, McKinsey— companies perform better, if you were doing it on your own, we wouldn’t be meddling. So that was one argument. Then we had legal arguments that were provided to us pro bono. [The law firm of] Reed Smith, they provided the legal ground for us to stand on against what the opposition was bringing up. The opposition said, “This is not equal treatment under the law and it’s unconstitutional, because why should a man have to give up his seat for a woman?” So we answered that by saying, “A man doesn’t have to give up his seat for a woman because you can add a seat for a board member any time you want to. You can add a seat anytime.” Yes, it’s going to cost them the compensation for that board member’s seat but if they don’t pay the compensation, then they’re going to pay a fine of $100,000. So, they may as well hire that pesky woman.
Q. You started your first company with just $800, a phone, and a typewriter. Is that still possible today?
Of course, it’s still possible for a service business. I opened a public relations agency and all you have to know how to do is write journalistic stories and convince clients you can get publicity for them. That’s what I did. I had previously worked at Disney Studios and the newspaper and television business, so I knew how to get publicity.
Q. How did you do it?
I was scared to death. I didn’t know if I could do it, but I felt I might as well try and if it doesn’t work, I can always get a job. Five years later, I brought on a partner and kept on growing. I started off in my apartment writing news releases for people, then I had to have freelancers, then I had to have employees, then it grew to be the largest independent PR firm in Los Angeles. We sold it 15 years later to Golin/Harris. And people who worked for me back then still work for Golin/Harris, which is very gratifying. Our number 3 guy is their worldwide CEO now.
But then 25 years ago, I started a retained executive search firm, having sold the one business. Entrepreneurs, any money you make you put back into your next venture. It’s been a great business and a lot of fun for the last 25 years, it’s our 25th anniversary. But it was 17 years ago that I became fascinated about ‘Why is there a lack of women on corporate boards?’ And I thought, maybe that would be a business practice for my search firm, Berkhemer-Clayton. And it did turn out to be that, which is why I know all about how board searches are handled. Why I can stand up in front of the committees in Sacramento and testify to tell them how board searches are handled and that it’s even if a search firm is involved. It’s all about whom you know and who knows you. That’s why we train women and advise women on how to strategically map the people that they know and the people that those people know in order to get introduced to a potential board and board members and how to work those contacts over a couple years. This takes time and commitment and, at times, investment of dollars to get yourself trained. But it’s worth it in the long run because you can end up with a board position or several, that pay you $70 or $100 thousand in in addition to your day job. It’s a good way to keep your career going in your 50s and 60s because from a board on a public company, the generally accepted retirement age is 72 or 75. Once the guys were getting close to 72, most of companies moved the age up to 75. But even at that they don’t always step down.
Q. What do you see for the future of women in politics? Will we have a woman President in 2020?
I don’t know if we’re going to have a woman but we’re sure going to have a lot of Democrats. I don’t know who’s going to be the front runner. It’s got to be somebody who’s very likable, somebody who people trust. The likeability factor has to be really high. You and I know Hillary won. We’ve got to get rid of this stupid electoral college.
Q. Do you think women face a higher barrier than men in all fields?
Q. Did you face that along your career journey? Times when you were treated less than?
Well, I’m sure, and I’m sure many times that I didn’t even know about it but being a woman business owner and proud of it, is sometimes an advantage and sometimes a disadvantage. I just try to work with the clients where it’s an advantage. Certainly, there are enough. There are many, many thousands of companies that can be your client. It’s a matter of, I would say, ‘Go out and get ‘em.’ Which is why so many women open their own businesses, it’s a lot easier to navigate being in business and on your own rather than working for some guy or men having to try and claw your way up to the C suite. So I recommend being an entrepreneur very highly, I’ve never missed a payroll in 40 years – there are times I didn’t take a paycheck but I never missed anybody else’s. I’m proud of that. That’s better than most big companies, even the federal government.
Q. You’re a lifelong PR person, did those skills help you succeed? What are those skills?
You have to be authentic and you have to really have the facts behind you. Trying to sell snake oil only goes so far. It has to be real and certainly 2020 Women on Boards and NABO – the facts and testimony for getting SB 826 through – stood behind us and that’s why we could keep on going at every juncture when we had to do a new committee that we had to testify before. You don’t just show up and testify, your compadres visit your legislatures in your district, we had a massive letter writing campaign to every committee chair. It’s a huge undertaking to get a bill passed, especially one this historic, monumental and going to change so many businesses here in California and across the country. New Jersey has already submitted their legislation and Massachusetts is going to in two weeks and other states will too. As California goes so goes the rest of the country, at least the blue states.
Q. What are your hopes for the future?
Six states did a resolution: after our resolution, five states followed and I hope the same thing happens here. I’ve done a lot of national news coverage and, just by the simple fact of getting this awareness out to companies around the country, they’re taking notice. They know the wave is coming, so a lot of companies that are enlightened are getting ahead of the game. Yeah, it’s not so bad to have a woman on the board or 2 or 3, it’s good for businesses, it’s good for retention, it’s good for attracting employees, good for the workforce to look up and see the women on the board. There’s nothing bad about it.
Q. Except it takes away from ‘The old boys club’?
I’m afraid so, yes. We use a little different language, maybe do some different things, they have to pay more attention to the bottom line because women ask questions, that’s why they don’t want us there. We get in, we do our job. We ask questions, we read the board book, we ask why some guy is getting paid more than some other guy is, what’s the difference in their job? Turns out nothing but one’s a friend of the CEO. There are a lot of things that go on.
It gets right down to the money. Guys want to bring their friends on to the board because they know that they’re giving them a lifetime income of $100,000 a year. It’s the money and the guys know all about that. The men are lined up six deep waiting behind every board, waiting for Joe to retire. ‘I’m buying a table at your gala, I got your kids into the University fraternity;’ trading favours back and forth for years and the big, big payoff is money for a corporate board seat. So they’re all lined up and we women are trying to wedge the women to the front of line. That’s disrupting everybody, ruining a lot of plans for these guys who simply expected to be gifted a board seat.
There’s a lot of behind the scenes stuff that goes on. There’s no ballot, there’s no choosing of which resume is the best. It’s all who you know and who hopefully has the expertise to bring value to board at that particular moment, who is going to get invited. When they do use search firms, they give us list of the names they already know and love. They have the search firm vet those names, checking out what boards they’ve served on, any conflicts of interests, what are the dates they could be at our board meetings and then they choose the person they wanted in first place, as long as the vetting report doesn’t come back with any scathing allegations from when they were on a previous boards. The optics of having a search firm: ‘Well, we had a search firm, we didn’t just simply choose our favourite person.”
"Even these senior level women who report to a CEO, who have so much expertise and would be such a value to boards, they really need to be trained about what to say about themselves, not in an interview but at a cocktail party when they might be talking to a guy who serves on a corporate board and you want him to remember you for what you really bring, what your experience is, etc."
Q. After 17 years, you’ve made this law a reality. What’s your vision for the future?
This is the biggest achievement of my life, I have purpose on this earth, I really do. Now the effort is to train the women. With 2020 Women on Boards, we have training programmes at Harvard, Kellogg School, U of Washington, at Seattle, they have training programmes specifically for women. With 2020 Women on Boards, I do full day immersion workshops that help women understand what to say about themselves.
Even these senior level women who report to a CEO, who have so much expertise and would be such a value to boards, they really need to be trained about what to say about themselves, not in an interview but at a cocktail party when they might be talking to a guy who serves on a corporate board and you want him to remember you for what you really bring, what your experience is, etc. Most women just talk all over the place, they don’t get right to the point. The guys can only remember one or two things, you have to hit them right away that you can immediately serve on the compensation committee or the audit committee of a public board. To say, ‘I’m intentionally looking for my first board seat so when one of your friends calls and says they’re looking for a woman candidate because it’s the law or it’s best business practices, think of me’. So that’s what we train women to do. I have a lot of work to be able to do that. And then when companies try to find women for their boards and they can’t do it, they’ll call my search firm, [Berkhemer-Clayton] and we’ll help them do it. There’s a lot of work to get done before I check out and go up to the pearly gates.
You can see easily what companies in your state and city have women on their boards and what companies you can target to try to meet people and get yourself on boards: Check the Russell 3000 Directory
*Interview has been edited and condensed.
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