U.S. Firms Slow to Raise Women Directors, Study Finds
Women and minorities remain underrepresented in U.S. corporate boardrooms, crimping companies’ potential to lead in the global economy, a report by the Alliance for Board Diversity showed.
White men held about 70 percent of the 1,211 board seats at Fortune 100 companies last year, little changed from 71 percent in 2004, said the alliance, which advocates the inclusion of women and minority directors. Women added 16 seats, a 1.1 percentage point gain the group called “not appreciable.” The biggest minority groups were African-American men at 7.3 percent, Hispanic men at 3.1 percent, and African-American women at 2.1 percent.
Citigroup Inc. (C), International Business Machines Corp. (IBM) and Procter & Gamble Co. (PG) were among about 26 Fortune 500 companies whose boards last year had representation from each of the U.S. Census Bureau’s major groups: men, women, whites, African Americans, Asian Pacific Islanders and Hispanics, the alliance said. Companies won’t reach their potential without leaders from different backgrounds, ethnicities and genders, it said.
“Six years after the first ABD Census, not much has changed,” said Ilene Lang, chief executive officer of research firm Catalyst and chairman of the alliance. “White men continue to dominate corporate boards and have, in fact, increased their presence since 2004. More diverse boards, on average, are linked with better financial performance.”
HCA Holdings Inc., a Nashville, Tennessee-based hospital chain, and L-3 Communications Holdings Inc. (LLL), a New York-based defense contractor, were two of 37 companies in the Fortune 500 that didn’t have women or minorities with director positions in 2010, according to the survey.
“We’re just recently a public company,” said Ed Fishbough, a spokesman for HCA. “We anticipate HCA will make more diverse additions to its board in the future.”
L-3 inspects “individual qualifications while carefully considering gender and racial diversity” when seeking potential candidates to serve on its board, Jennifer Barton, a spokeswoman, said in an e-mail.
Laurie Friedman, a spokeswoman for IBM, declined to comment.
“We recognize the value that our diverse workforce brings to our clients,” Jon Diat, a spokesman for Citigroup, said in an e-mail. P&G views diversity as a “business necessity,” Paul Fox, a company spokesman, said in an e-mail. Rajat Gupta stepped down from the board in March and the company no longer has an Asian Pacific representative, Fox said.
Fortune 100 Boards
Among Fortune 100 companies, white men lost four board seats from 2004 to 2010 and white women gained 11. Asian Pacific Islander men gained 12 seats, African-American men lost five seats, and Hispanic men lost three.
The report is based on data from all of the companies in the 2010 Fortune 100 and from 491 companies in the Fortune 500 that had complete race, ethnicity and gender information, the report said.
The Alliance for Board Diversity is made up of Catalyst, which focuses on women in business; the Executive Leadership Council, an organization of leading African-American executives; the Hispanic Association on Corporate Responsibility, which represents 16 Hispanic organizations in the U.S. and Puerto Rico; and Leadership Education for Asian Pacifics Inc., which provides leadership training to the Asian and Pacific Islander communities.