Equilar’s new report, the Gender Diversity Index (GDI), was created to deliver quarterly updates on the prevalence of female board members at Russell 3000 companies. In its first published report (January 2017), the GDI highlighted the less-than-pretty facts it was designed to measure:
While today’s charge for board diversity is pronounced and widely supported, the progress remains sluggish. Equilar’s GDI data shows that only 15.1% of board seats at Russell 3000 companies were occupied by women (as of year end); this is up from 13.9% in 2015 and 13.2% in 2014. The needle may be moving… but certainly not at a pace we can cheer about.
Recently, Ethisphere hosted the Gender Diversity Forum at the Nasdaq MarketSite to discuss how American companies can move from ideas to action. According to Ethisphere’s global research, only 20% of companies believe that their diversity policies are actually effective. In this Facebook Live session from the Nasdaq MarketSite, Ethisphere’s Erica Salmon Byrne and Ty Francis identify the ‘change agents’ within a corporation and how companies can begin to mobilize them.
Posted by Nasdaq on Tuesday, February 7, 2017
What Can We Expect for Diversity in 2017?
The Center for Audit Quality was a partner at the Gender Diversity Forum and shared some interesting insights from the day.
“One key takeaway was that this year, we will likely see a concerted effort by institutional investors to communicate their board diversity expectations to companies,” said the CAQ’s Senior Director of Stakeholder Engagement, Erin Dwyer, summarizing the panel titled Telling Your Story: How Much to Say and Who’s Asking.
The question then becomes, what actions will investors take if companies are not meeting those expectations? Will we see votes against Nom/Gov chairs? We’ve already seen large institutional investors coming together through the Investor Stewardship Group to promote positive principles that broadly encourage board diversity, but it will be interesting to see if there are similar, more detailed concepts put forth this year.
The panel also discussed how the new presidential administration may impact this year’s diversity landscape. With changes underway at the SEC, new leadership will likely be less inclined to push former SEC Chair Mary Jo White’s proposed diversity disclosure concept—which may, in turn, also create an opportunity for companies to step up.
“In the absence of new regulation or regulatory pressures, companies have the opportunity to voluntarily demonstrate strong governance through enhanced diversity and other disclosures,” said Dwyer.
Equilar’s Gender Diversity Index also highlighted several “winners” in gender diversity. Williams-Sonoma, Tegna, Macy’s, Alliant Energy, Viacom, and several more were recognized for achieving 50% female representation on their board.
With several powerful diversity initiatives already in motion in 2017, we look forward to the progress this year will bring. Stay tuned for Equilar’s quarterly GDI reports, which will allow us to benchmark the strides being made throughout this year.