S&P 500 boards have hit a tipping point that may lead to more female CEOs
Good morning, Broadsheet readers! Catherine, Princess of Wales announced she is undergoing chemotherapy treatment for cancer, Tammy Murphy suspended her campaign for a New Jersey Senate seat, and diverse boards lead to diverse CEOs. Have a mindful Monday.
- On board. Women make up 9% of S&P 500 CEOs—but could that number go up soon? According to new data from the Conference Board and ESGAUGE shared exclusively with Fortune, we may be at a tipping point that makes an increase likely.
The new analysis looks at board-level gender diversity at the time of each S&P 500 female CEO’s appointment to the job. It found that companies that hired a female CEO had more-diverse-than average boards at the time.
When Best Buy hired CEO Corie Barry, for example, the tech retailer’s board was 56% female. When Citigroup named Jane Fraser leader of the bank, its board was 50% women. When ADP hired Maria Black as CEO, its board was 42% female.
On average, companies that hired female CEOs had boards that were one-third female. Which brings us to the Conference Board’s next conclusion: Today, women hold 33% of board seats throughout the S&P 500, compared to 25% five years ago. Hitting that 33% board gender diversity benchmark suggests more companies could appoint female CEOs the next time the chief executive job opens up.
“The growing presence of women in corporate boardrooms may soon lead to more women in the corner office,” says Conference Board ESG Center senior researcher Merel Spierings. “Our rationale: Today’s female CEOs in the S&P 500 were appointed by a board where, on average, one-third of the directors were women. The fact that 33% of all S&P 500 corporate directors today are women may indicate that more boards are positioned to appoint a female CEO.”
Overall, the gap between gender diversity on boards that hire female CEOs and overall board diversity is narrowing. The Conference Board expects progress based on that trend—it'll be up to boards to make it a reality.
Emma Hinchliffe
emma.hinchliffe@fortune.com
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This story was originally featured on Fortune.com
