The 2022 Board Monitor report found that 45 percent of the 449 board seats filled in 2021 were women directors, up from 41 percent the previous year. Fortune 500 boards appointed a record number of women in 2021, although new Latinx, Asian and Asian American women continue to be underrepresented, according to a new report released by executive search firm Heidrick & Struggles.
According to the report, global events like the pandemic, climate change, increased calls for racial and social justice, and the war in Ukraine have prompted corporations to focus more attention on “organizational purpose.” In response, the report states, Fortune 500 boards of directors notably shifted to bringing in a wider range of experience, including more directors who are women, diverse and serving for the first time in the boardroom.
“Boards continue to seek fresh thinking as evidenced by the appointment of directors with more diverse backgrounds,” said Bonnie Gwin, vice chair and co-managing partner of Headrick & Struggles’ global CEO and board of directors practice. “And the truly cutting-edge boards are taking a strategic, holistic approach to board succession by continuously monitoring refreshment opportunities to meet today’s challenges and respond with resilience when the unexpected occurs.”
While the number of women board members continues to trend up – 29 percent of all directors on Fortune 500 boards are women, up from 19 percent in 2015 – the number of Asian/Asian American and Hispanic/Latinx directors continue to be underrepresented at 9 percent and 6 percent, respectively. Those percentages have not risen in recent years, the report found.
“We are encouraged to see the trend toward more equitable representation on boards,” said Lyndon Taylor, regional managing partner of Headrick & Struggles’ North American CEO and board of director practice. “We expect that more progress will be made on DE&I (diversity, equity and inclusion) when diverse directors hold more influential board positions, especially as board chair or chair of the nominating and governance committee, but this will require that boards take a comprehensive perspective on diversity from gender experience to continue pursuit of aspiring directors that are racially and ethnically diverse.”
Other notable findings in the report include:
- While current or former CEOS and CFOs continue to fill the majority of appointments, the trend is on a gradual decline. In 2021, 40 percent of appointees were current or former CEOs, down significantly from the high of 60 percent in 2018. Current or former CFOs made up 14 percent of appointments in 2021, down from a high of 21 percent in 2020. Notably this year, 16 percent of newly appointed women directors have CFO experience compared to 11 percent of men.
- The average age of new board members continues – for the sixth year – to hold steady around 57, with 64 percent of the seats in 2021 going to people 55 and older; 6 percent to those under 45.
Only 31 percent of Hispanic/Latinx appointments and 33 percent of Asian/Asian American appointees are women compared to the higher gender diversity among black (43 percent) and white (49 percent) appointees.
Marie Leech, Contributing Writer, bizwomen
May 12, 2022