NEW YORK--(BUSINESS WIRE)--Today, 30 percent of board of directors members at S&P 500 companies are women, a figure projected to grow in the coming years, according to research by Pay Governance, a premiere board-level executive compensation advisor, which advises the boards of many prominent publicly traded companies.
“Board gender diversity has become a major corporate governance objective globally,” said Olivia Wakefield, Partner at Pay Governance. “In the U.S., we have achieved substantial progress on gender diversity at many large publicly traded companies. In fact, over the past five years, the number of women board members has increased by 2,700. That represents an 18 percent increase from five years ago. At the same time, more than 1,900 men have departed these boards. As a result, 30 percent of board members at the S&P 500 are women. While there is more work to do, this is a significant shift in boardroom demographics.”
To understand the progress of women serving on boards, Pay Governance examined unique information from the DirectorMoves database.
“We created this unique database to highlight the evolving dynamics of gender diversity in the boardroom,” said George Fleck, publisher of DirectorMoves. “The ongoing progress that women are making in joining major company boards is indisputable. We appreciate the analysis by Pay Governance in telling this important story.”
“In a 2021 annualized forecast, more than 1,400 men are projected to be recruited to join boards, while more than 1,800 men will depart,” said Pay Governance Managing Partner Ira Kay. “By contrast, approximately 1,200 women directors are projected to join boards, and only 460 will depart.”
While the projected total number of men joining boards will remain slightly higher than women in 2021, the departure levels for men will be substantially higher than that of women, the Pay Governance report states.
Wakefield attributes the increase of women on boards within the U.S. to a number of factors, including legislation, regulatory efforts and shareholder focus, as well as the hard work of groups and leaders focused on the criticality of diversity issues.
“To continue diversity progress, companies should re-evaluate the skills and capabilities they need from their board members, as well as facilitate that evolution of skills to match strategy and culture via board succession planning,” she said.
“The increased representation of women in the boardroom over the past five years is promising,” Kay said. “While boards have made progress on gender diversity, there is more to do to increase both gender and minority representation on boards as part of diversity, equity, inclusion and belonging priorities. This means that we can expect to see more change in board composition in the coming years.”
Pay Governance LLC is an independent consulting firm focused on delivering advisory services to compensation committees. The consultancy also advises the management of companies in situations in which the firm does not serve as the independent committee advisor. Pay Governance has locations throughout the United States in New York, Boston, Detroit, Philadelphia, Pittsburgh, Atlanta, Chicago, Dallas, Cleveland, St. Petersburg, San Francisco and Los Angeles. The firm also has strategic affiliate relationships with Pay Governance Japan and Pay Governance Korea. For more information, visit www.paygovernance.com.