To gain a holistic view of the progress made by women over the past year, Women Leading Boards, a special report from Women Business Collaborative (WBC) and 50/50 Women on Boards™ (WOB), assesses data from a variety of sources, including global benchmarks, the Russell 3000 Index, the Fortune and S&P 500s, as well as privately held companies.
2021 was a watershed year for board diversity. Influenced by investor preferences, new and emerging U S regulations, as well as a wave of diversity advocacy amongst various stakeholders, the number of directors from underrepresented groups rose significantly. A recent Women Business Collaborative report, Women Joining Public Boards, reveals that, of women who chose to self-disclose their race, Black / African American women take the lead in board appointments, closely followed by Asian /Pacific Islander women, however, Hispanic women, Middle Eastern / North African women, and multi-racial women continue to fall behind Moreover, women held 27% of all board seats in 2021, up from 24% in 2020—the largest year-over-year increase among the Russell 3000 and far above the Russell 3000’s average annual increase of 2 14% for women on boards Black board membership also spiked (32%), with a 30% rise in companies with Black directors.
While the needle has clearly moved, is the recent increase in inclusive Directors & Officers (D&O) appointment practices enough?
Although the surge in the appointment of Black directors is encouraging, Hispanic individuals still comprise only 1% of all board seats, lagging substantially behind their 18 5% share of the U S population (See “Latinas are the Least Represented Group on U.S. Company Public Boards” on page 27) In addition, at the current rate of change, women will not hold 50% of corporate board seats for at least another eight years (See “How Can Corporate America Advance Gender Parity” on page 13).
Furthermore, as the global pandemic enters its third year, women have disproportionately borne the brunt of its devastating professional impact Minority women in particular are more likely to be in positions requiring in-person work (Gould and Shierholz 2020) Many were laid off as the pandemic intensified while women of all ethnicities voluntarily dropped out of the labor force (Heggeness 2020) to care for children or ill, disabled, or elderly family members.
In fact, according to an analysis by the National Women’s Law Center (NWLC) of the latest U S Bureau of Labor Statistics report, as of January 2022, women have collectively lost more than 1 8 million jobs since February 2020. This figure does not include women who left the labor force entirely and are no longer looking for work Had those individuals been included, about 5% of all women, 7 3% of Black women and 5 4% of Hispanic women would be considered unemployed, according to the NWLC report For those women who remain in the workforce, the burnout gender gap has more than doubled since 2019 According to a December 2021 Gallup Poll, women are more likely than men to feel burned out at work, 34% vs 26%, with women in non-leadership positions especially affected.
The mass exodus of women from the workforce combined with increasingly weary ranks of rising women leaders suggests organizations may have a smaller pool from which to choose qualified board candidates in the future, potentially slowing or reversing the positive advances toward gender parity observed in recent years.
However, a recent look at board parity by WBC indicates companies may already be widening their nets As of February 2022, 114 women (31 1%) were appointed to public company boards, with 58% of those women being appointed to a board for the first time. The march towards parity—achieving board composition of more than 50% women—continues.
In fact, the following ten companies have already achieved parity and half are led by women CEOs and Board Chairs:
Additionally, organizations such as Best Buy, The Clorox Company, The Hershey Company, and Walgreens have achieved 40% women on board and are led by women CEOs.
What about privately held companies, which traditionally fall behind their more PR-driven public company peers?
According to a report by Bolster, one of the top executive talent marketplace organizations, which assessed 650+ board directors at private companies, 86% of private company director seats are still held by men Additionally, more than half (56%) of early-stage private company boards did not have any gender diversity, and only 12% of boards in the study had more than one woman on the board.
Bolster, a WBC Partner Organization, also found that four out of five startup board directors identified as White, and 43% of boards were completely homogenous related to the race / ethnicity of their director (See “How CEOs Can Leverage Independent Directors to Bring More Women on Boards”on page 18).
Similarly, the Lodis Forum, a peer group for woman Board Chairs and WBC Partner Organization, recently completed a poll of 249 privately held companies, representing 1695 directors Lodis’ survey showed that woman Chairs had the biggest impact on gender diversity and women in board leadership roles (See “’Private’ No More: Gender Diversity Trends in Non-Public Companies” on page 30).
So, while our primary goal continues to be getting more women—and, more specifically, women of color—seated around the boardroom tables of private and public companies alike, a second, equally important objective has emerged At Women Business Collaborative, we believe it is not enough to tally the number of women serving on boards Board diversity and inclusion means appointing with intentionality, building tenure limits, and allowing new perspectives to shape how you respond to your shareholders, employees, customers, and community’s needs 30%Black board membership increase in 2021:1%Number of board seats held by Hispanics—lagging substantially behind their 18.5% share of the U.S. population.
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