Although women gained nearly 50% of new corporate board appointments in the last quarter, diversity is still lacking on Russell 3000 Boards, according to 50/50 Women on Boards.
The fourth quarter 2021 Gender Diversity Index from the leading non-profit education and advocacy campaign driving the movement towards gender balance and diversity on corporate boards confirmed that as of 31 December 2021, women hold 26.7% of the Russell 3000 company board seats. The average year-over-year increase is 2.14%, with the largest year-over-year increase of 3% from 2020 to 2021. Furthermore, 48% of the 598 directors who joined boards in Q4 2021 were women, consistent with Q3 2021, and the highest quarter-over-quarter percentage increase; as reported.
“Over the past year, we have seen increases in women on boards, with some sectors and states exceeding 25% women on their boards, but we are still far from gender balance and diversity on boards,” highlighted Stephanie Sonnabend, Co-Founder and Chair of 50/50 Women on Boards. “While we have made progress, it is imperative that corporations take necessary actions to ensure we achieve women holding 50% of all corporate board seats with women of colour holding at least 20% of all corporate board seats.”
BOARDS STILL LACKING DIVERSITY
At the current rate of change, women are not expected to hold 50% of corporate board seats until 2030. To cut the estimated timeline in half, and reach the goal by 2026, the percentage of women needs to increase by 5.8% year-over-year, almost doubling the percentage increase from 2020 to 2021. For women of colour to hold at least 20% of corporate board seats by 2030, the percentage of women of colour appointed to boards needs to increase by at least 1.79% each year.
“While the recent data is encouraging, and we applaud companies leading the way, it’s vital that we reach women earlier in their careers to help them develop a leadership path at the onset of their professional journey,” said Betsy Berkhemer-Credaire, CEO of 50/50 Women on Boards. “As part of our mission, to educate and advocate for women, 50/50 Women on Boards believes that corporations invested in women’s leadership and board pursuit programs like ours, will help build the next generation of women directors and ensure we reach our goal before 2030.”
Using the data provided by Equilar, the findings showed that only 21% of boards have one or no women; a significant improvement from 2017 when over 50% of the companies had or no women on their boards. Additionally, 87% of the seats gained by women directors were seats added to a board rather than waiting for a man to retire.
FEW PEOPLE OF COLOUR
Based on those who self-identify, of the total directors, only 15% reported as people of colour, with women of colour holding 6% of company board seats and men of colour holding 9%. In comparison to total directors, 30% identified as people of colour, (16% women of colour and 15% men of colour). Of the states with more than 20 public companies, 17 states have more than 25% women on boards, up from four states in 2020. California and Washington State have more than 30% women on boards.
Sectors that exceeded the national average of women include utilities (31.1%), consumer defensive (30.4%), consumer cyclical (29.7%), real estate (27.5%), technology (27.2%) communication services (26.7%). Other significant key findings include:
- 241 (8%) of Russell 3000 Index companies have gender-balanced boards, up from 173 (6%) in Q4 2020.
- 1,172 (40%) of Russell 3000 Index companies have 3+ women on boards, up from 879 (30%) in Q4 2020.
- 891 (31%) have two women, 529 (18%) have one woman, and 81 (3%) of companies have no women.
PATH TO THE BOARDROOM
To help more women achieve board roles, 50/50 Women on Boards has launched a new educational programme “Your Path to the Boardroom”, which is designed to meet women at every stage in their career. The workshops will provide women with the strategic tools and insights to map their leadership and board journey, cultivate meaningful relationships and increase their visibility in pursuit of a board position. Click here to find out more about the programmes.
Almost half of new board director roles went to women last quarter according to another study. Click here to read more.
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