Among Standard & Poor's 500 companies in the US, only 5.4 per cent of companies have women representing at least 30 per cent of directors, according to a new study by Pay Governance.
Currently, females represent approximately 15 per cent of outside board member seats in the S&P 1500 and about 18 per cent of the S&P 500 seats. This equates to a median of 1-2 female board members in a group of 9-11 board members, states the study.
Specifically, the study focuses on lessons learned from selected US public companies that already have succeeded in achieving higher levels of board gender diversity.
The study reveals that women make the decisions for many household purchases, including financial investment decisions. While not every consumer necessarily looks at board composition in making a decision, for a board to provide effective leadership and counsel it should be able to understand and represent the customer. Also, having gender diversity improves the quality of boardroom dialogue and decision making.
There was consensus that diversity made the quality of the conversation better, more professional and more effective, said the survey.
The survey reveals that companies want to have the board composition be representative of the customers and the employees. These companies have enlisted the help of focused recruitment support and management, some with a distinct imperative to identify broad slates of female candidates, to ensure the best candidates are presented to the board.
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