Dive Brief:
- At least 20% of the board members for companies in the Russell 3000 index are women, according to Equilar's Gender Diversity Index (GDI) for the second quarter of 2019. This is up from 2018, when Q1 numbers indicated 16.9% female directors, and 2017, when only 15% of the board seats on the index were held by women.
- The report also notes that the percentage of women joining as as first-time public company board members has exceeded 50% for three of the last four quarters.
- The increase, described as "sustained progress on one of the most visible board diversity issues of the past decade," was attributed to activist investors, among other things.
Dive Insight:
The S&P 500 Index companies hit a milestone this summer when Copart Inc. announced the addition of a woman to its board; the move meant that the S&P 500 no longer had any all-male boards. The Wall Street Journal, citing research provided by Equilar, reported that 1 in 8 S&P 500 companies had all-male boards in 2012, but by the beginning of 2019, only a few all-male boards existed. Today, women make up 27% of all the index's directors, up from 17% in 2012.
Worldwide, few companies have women on their boards. Fast Company has reported that Egon Zehnder, an executive search firm, found through its Global Board Diversity Analysis that, in 2016, 19% of board seats in the world's largest companies were held by women, a 5% increase since 2012. Norway had the highest percentage of women (29%) in executive and non-executive chair positions. Italy was second with 27%. The U.S. lagged behind most Western European nations, South Africa and Canada in female board membership.
Some U.S. states have taken action. California passed a law in late 2018 mandating that all companies principally located in the state must have at least one female board member by the end of 2019. By 2021, companies with five-member boards will need at least two female members, while those with six or more members will need three in order to remain compliant.
The slight rise in gender diversity at the most significant levels of corporate involvement has been attributed, in part, to the #MeToo movement. In a survey published after the direct aftermath of #MeToo, 80% of recruiters reported seeing an increase in the number of requests for female execs.
