Board diversity has long been a topic of importance to the U.S. responsible investment community. Many shareholder advocates have urged companies to appoint women and members of minority groups to their boards, and some SRI funds have withheld support from boards that are entirely white and male. In recent years the highest-profile American companies have seemed to get the message, at least with regard to gender: the vast majority of S&P 500 companies now have at least one woman on the board. We at The Corporate Library wondered, though, if this phenomenon was confined to large caps, and also whether it really meant that women’s contributions and leadership were being recognized at the larger companies. We drew on our Board Analyst database to investigate, and the results - published today in our report, “Uneven Progress: Female Directors in the Russell 3000” - were sobering. Despite the widespread presence of women on S&P 500 boards, most female directors are a small minority of their company’s directors, and do not hold leadership roles. It is still quite uncommon for women to serve as board chairs, lead directors, or chairs of key committees, and very rare for companies to have two or more women in such position of responsibility. Finally, the news from beyond the S&P 500 is even worse. The number of female directors falls dramatically with market cap, and half of the Russell 2000 companies have no women on their boards at all. The SEC filings we base our work on don’t have standardized disclosure on race or ethnicity, so we haven’t been able to explore other kinds of diversity. But we can’t imagine that the picture looks any better for African Americans, Latinos, Asian Americans, or other minority groups.
We may have come a long way, baby, but there’s still a really, really long way to go.
Download the report for free from The Corporate Library's website.
Kimberly Gladman - Director of Research and Risk Analytics
