In-Depth Report: Board Gender Diversity

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Why are public companies facing shareholder proposals on topics related to board gender diversity?

Because the numbers just don’t add up.

Women are rising to the highest levels of government in many countries, advancing to executive ranks at top corporations,

and picking up more undergraduate and advanced degrees than men. In the first quarter of 2019, 29.5 million women in the U.S. labor force had at least a bachelor’s degree, compared with 29.3 million men, and 50.2% of the college-educated workforce was female. Further, women’s employment rates held up better than men’s in the years following the recession, and, in 2018, an all-time high of 256 women were on the Forbes list of world billionaires. In 2020, the coronavirus pandemic reduced the list of billionaires overall and, of those who remained, 51% were poorer than they were in 2019. However, the list still contained 241 women in 2020. 

And yet, despite these continued successes, and attempts by regulatory bodies to rebalance, there remains a dearth of female directors on the boards of public companies around the world.

Board composition is consistently one of the most important topics on the agenda for shareholder engagement, and voting. This proxy season, boards and management will once again be asked to address both the ongoing imbalance between male and female directors, and underlying nomination and recruitment processes. Investors will be asked to vote — and will need to understand the issues involved. Glass Lewis’ newly updated Board Gender Diversity report provides crucial context, from an overview of where things stand in the U.S. and internationally, investor and state efforts to promote balance in the boardroom, and academic research on the benefits of diversity. The report is part of Glass Lewis’ “In-Depth” series, a growing library of ESG-focused literature that illuminates the topics at the top of the agenda for investors and public companies.

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