Corporate America and Women: More Progress, Please
The idea that U.S. corporate boards need women hit the spotlight last year. Thursday was International Women's Day, so it's a perfect time to wonder if we're achieving a better balance in 2012.
GovernanceMetrics International has released its annual breakdown of female participation on corporate boards across the globe. The verdict is that females are making some progress in corporate boardrooms this year. However, bear in mind that forward movement remains slow.
Pockets of progress
GMI Ratings' 2012 Women on Boards Survey tracked more than 4,300 companies in 45 different nations. GMI's Paul Hodgson broke down the data, pointing out some of the most salient findings. For example, in 2012 we can celebrate a first: Females sit on more than one in 10 boards all over the world. Now, 10.5% of the directors GMI covers are women, up from 9.8% last year.
The percentage of companies with no female directors to be found has now fallen below 40% (another first). The percentage of companies boasting at least three women on their boards has increased by 1.3 percentage points. The bad news is that this achievement has only occurred at 9.8% of companies across the globe.
Some countries' corporate classes have taken a leadership stance on including females on boards of directors. Norway's a longtime leader; females represent more than 36.3% of the directors in that country's boardrooms.
France is big-time stepping up efforts to better integrate female perspective in corporate boardrooms. The fact that female directors in France increased by 3.9% in 2010-2011 is impressive, but bear in mind that this leap forward relates to a 2010 law mandating specific thresholds of female directors within specified timeframes. Now, the number of female directors in France is 16.6%.
America falling behind
So how does the U.S. stack up? The answer is: not very well for a country so many of us would like to call enlightened. Between 2009 and 2011, the percentage of females on American boards has increased a mere half a percentage point. The total percentage of women on U.S. boards is a paltry 12.6%.
Despite the fact that the majority (more than 70%) of U.S. companies have at least one woman on their boards, corporate America falls short on furthering representation. Only 10% of companies have more than three women on their boards, and a sad 2% of board chairs are female.
I asked GMI's Hodgson for some examples of U.S. companies that can boast having more than three women on their boards, and he revealed a few interesting ones. First off, for context, just 230 American companies have at least three females on their boards.
Walt Disney's (NYS: DIS) board actually comes across as pretty impressive in the grand scheme of things. Susan Arnold, Judith Estrin, Monica Lozano, and Sheryl Sandberg make up a pretty impressive list of female directors at the kid-centric media giant. Estrin and Lozano are both chief executive officers at other firms, Arnold is a retired Procter & Gamble executive, and Sandberg is Facebook's current chief operating officer.
Hewlett-Packard's (NYS: HPQ) board of directors has disappointed shareholders many times, but at least it can boast a solid dose of female leadership, especially since it named Meg Whitman as its new CEO. Still, it just hits the threshold of three female directors here: Whitman, Ann Livermore (a former HP employee and 30-year veteran insider), and former Alcatel-Lucent CEO Patricia Russo.
GMI's Nathaniel Flannery has been tracking this topic for a while, too, and recently called out 10 companies with zero women on their boards for Forbes. However, in a major sign of progress, Zale (NYS: ZLC) , Gap (NYS: GPS) , and Crocs (NAS: CROX) have all added females to their boards since last year's public shamings.
Corporate America: More progress, please
Female perspectives and points of view bring strengths to many areas of our lives. When it comes to corporate management teams and boards, such strengths include lower risk-taking and a lesser tendency to go on pink-slip frenzies, for example. Our short-term market often celebrates layoffs for short-term profit boosting, but the less-acknowledged long-term story is what that mentality actually does to enterprises' future prognoses.
Come on, corporate America. We can do better.
Check back atFool.comevery Wednesday and Friday for Alyce Lomax's columns on environmental, social, and governance issues.
At the time this article was published Alyce Lomax does not own shares of any of the companies mentioned. Motley Fool newsletter services have recommended buying shares of Procter & Gamble and Walt Disney. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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