Boardroom Diversity at a Standstill in Fortune 500 Companies
Alliance for Board Diversity Study Shows that Women and Minorities Make No Real Gains
WASHINGTON, Aug. 15, 2013 /PRNewswire-USNewswire/ -- In its biennial study released today, the Alliance for Board Diversity (ABD) reported that women and minorities have made no real gains in the boardrooms of corporate America. The ABD is a collaboration of four leadership organizations: Catalyst, The Executive Leadership Council (ELC), the Hispanic Association on Corporate Responsibility (HACR), and Leadership Education for Asian Pacifics, Inc. (LEAP). The Prout Group, Inc., an executive search firm, is a founding partner of the ABD and serves as advisor and facilitator.
According to the report, Missing Pieces: Women and Minorities on Fortune 500 Boards, 2012 Alliance for Board Diversity Census, in the Fortune 100, women and minorities remain vastly underrepresented at the decision-making tables of corporate boardrooms, with white/Caucasian men comprising nearly 70 percent of the 1,214 seats. The trend is similar in the Fortune 500, with white/Caucasian men accounting for 73.3 percent of the total 5,488 board seats. Overall, there have been only very small gains in boardroom representation since the first ABD census of Fortune 100 board directors in 2004.
Women and minorities also continue to be underrepresented in leadership roles in boardrooms. Among the five major categories assessed—Board chair, lead director, audit committee chair, nomination/governance committee chair, and compensation committee chair—women and minority men experienced small increases in leadership positions on boards. Minority women were the only group that did not make any gains in leadership positions.
"We continue to find the research troubling because the ABD believes in the business proposition that when diversity leads, business succeeds. We know that in order to sustain long-term success, companies must continually create new ideas and solutions," stated ELC President and CEO Ronald C. Parker. "This innovation is driven by diversity of thinking at every level of the organization, especially within senior leadership teams and in the boardroom. Women and minorities are an important part of that equation."
The ABD believes that there are valuable benefits to corporate diversity. This belief is, in part, based on research which shows that diverse teams, well managed, yield better results. The research also indicates that diverse teams help drive new and independent perspectives and better group performance as well as provide market-based insights which are critical for innovation and business success over time.
According to the ABD, the challenge to board diversity is not on the supply side. There are more qualified women and minority executives than ever before for board positions at Fortune 500 companies. The ABD is doing its part to ensure that qualified candidates are considered for board opportunities. Each ABD member supports initiatives that position qualified women and minorities for service on Fortune 500 corporate boards.
In collecting its research, the ABD utilized a Census methodology that counts Fortune 500 board directors to provide an accurate measurement of their representation and progress of women and minorities, allowing comparable statistics year-to-year. The ABD analyzes companies on the Fortune 500 list, which is published annually.
For more information on this report and the Alliance for Board Diversity, please visit www.theabd.org.
THE ALLIANCE FOR BOARD DIVERSITY
Founded in 2004, the Alliance for Board Diversity is a collaboration of four leadership organizations: Catalyst, The Executive Leadership Council Inc. (ELC), the Hispanic Association of Corporate Responsibility (HACR), and Leadership Education for Asian Pacifics, Inc. (LEAP). The Prout Group Inc., an executive search firm, is a founding partner of the alliance and serves as advisor and facilitator. The ABD's mission is to enhance shareholder value in Fortune 500 companies by promoting inclusion of women and minorities on corporate boards. More information about ABD and access to Missing Pieces: Women and Minorities on Fortune 500 Boards is available at www.theabd.org.
SOURCE Alliance for Board Diversity
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