ESG & Diversity
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Mary Oyerly
Senior Content Strategy Specialist

Boardroom gender diversity: A complex story that’s still unfolding

October 14, 2022
0 min read
Professionals discussing boardroom gender diversity.

Conversations and disclosures around gender diversity have increased worldwide over the past several years, thanks in part to regulation, legislation, quotas, and intensified public and stakeholder scrutiny. But how is the attention translating into tangible progress on gender diversity?

Here the results are mixed — and filled with nuances like regional differences and the intersection of gender and professional background/skill sets. Diligent dived into the details in its 2022 Global Modern Leadership Report. Highlights follow.

More Women Serve on Boards — But More Are Still Needed

The good news is that gender diversity on boards is improving. According to global Diligent data from about 6,000 publicly traded companies through May 2022, female directors hold approximately 27% of board seats. This is up from 26% in 2021 and a 4 percent increase from 2019. Moreover, women represented more than one out of three (34%) director appointments in the first half of 2022.

But 27% is still a far cry from parity. And female board appointments have actually been declining — down from 39% of new directors in 2019.

What’s more, many of these new directors are serving double — or even triple — duty as boards tap the same women for open roles. Globally, nearly 1 out of 5 (19%) female directors hold three board positions. In Australia, 42% of female directors hold three or more board seats compared to 18% of male directors, and in the UK the percentages are 35% of female directors compared to 16% of their male counterparts

A March 2022 article in the Harvard Law School Forum for Corporate Governance explains this phenomenon:

“Companies often select from a pool of ‘the usual suspects’— a very small list of women who are well-known and well-connected—to fill board roles. … In France, journalists named these women ‘jupes dorées’ — golden skirts — and pointed to a small, highly connected group of women who had been asked to join many of the newly opened board seats.”

Furthermore, few of these women chair boards or even committees. According to data from Diligent, only 7% of female directors hold leadership positions while almost a quarter (24%) of all male directors do.

Finally, the picture is particularly grim for privately held companies. Diligent collected data on 228 private growth-stage companies in a survey conducted in early 2022. We discovered that women held only 11% of board seats, compared to an average of 27% in public companies. Additionally, 58% of the private companies we analyzed have an all-male board, compared to only about 6% of publicly traded companies.

“While publicly owned companies are making changes as a result — mostly — of investor pressure and PR considerations, privately-owned companies simply don’t see what’s in it for them,” observed Greice Murphy, a healthcare entrepreneur and board member who’s involved with several organizations promoting board diversity.

Representation Varies by Region and Company Type

Progress on gender board diversity also depends on where you work. It’s important to recognize that 27% female representation on global boards is an average. Representation by nation ranges from 42% for France, fueled by a mandated 40% quota of female directors, to 8.9% for the United Arab Emirates — still low but a marked improvement from 3.5% in 2020.

Within Europe, France and Sweden lead the way while Greece and Luxembourg are falling behind with fewer than 25% female directors. And Asia’s 14% average of board seats held by women only tells part of that continent’s story. Women hold approximately 19% of board seats in Malaysia and 18% in India, but disclosure rules around skill sets and mandates on gender diversity have made an impact in recent years.

Across the globe, having one’s company publicly listed on a stock exchange tends to bode well for board gender diversity:

  • In 2022 thus far, 46% of new directors appointed to S&P 500 boards have been women
  • 32% of S&P board seats overall are held by women, up from 30% in 2021
  • Women board members are in equal numbers to men or a majority for 27% of the companies on Norway’s OBX, and one in five companies on the FTSE 100
  • Among the top 30 companies on the Nigerian Stock Exchange, female directors hold approximately 24% of board seats, and 17% of board chairs are women

The Intersection of Gender with Skillsets, Tenure and More

But gender diversity doesn’t operate in a vacuum, and this year’s report noted several interesting intersections and connections in terms of board member skillsets, age, tenure and more.

For starters, when boards onboard more female directors, they often diversify their boards across multiple characteristics. Age representation is one area. Female directors trend younger than their male counterparts. Skills representation is another. Female directors are more likely to bring domain expertise in areas such as technology, sustainability and legal issues to the boardroom. In fact, there are three times as many female directors with professional backgrounds in sustainability/ESG roles compared to their male counterparts, according to Diligent data. Furthermore, the 7% of directors with technology backgrounds show encouraging signs of gender parity. These directors are equally as likely to be female as they are to be male.

On average, female directors also have shorter tenures than their male counterparts: 4.7 years vs. 7.6 years. This discrepancy could be due in part to the large difference in the percentage of male and female non-executive/independent board members. About 84% of female directors globally are non-executive/independent, compared with only 59% of their male counterparts.

So, what’s behind the discrepancy between executive and non-executive board members? Fewer members of the C-suite are female. This means that when directors ascend to the boardroom from the senior ranks of the company, they are more likely to be male and executive/dependent. Meanwhile, female directors are more likely to come from outside the organization.

Such trends, connections and intersections point to continued complexity in the road ahead — and are something for corporate boards to keep in mind as they accelerate their efforts toward gender diversification.

Download the 2022 Diligent Global Leadership Report.


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