women in leadership

When Women Lead: Women Leaders Positively Impact Boardroom Diversity

Our flagship reports, “When Women Lead” (2020 Women on Boards 2016, 2017) showed that when women hold positions of leadership (CEO, Board Chair and Nominating Chair) boards are more gender diverse than boards of companies led by men. The reports looked at companies in the Fortune 1000 index for 2015 and 2016.

We revisited the topic this year, looking at companies in the 2017 Russell 3000 Index, from our newly expanded Gender Diversity Directory. The results are similar to last year’s findings: Of the 2871 active companies, 125 have female CEOs.  The percentage of women on their boards is 30.2%, double that of male CEOs’ boards at 15.4%.  Eighty percent of the companies with female CEOs are Winning “W” Companies at 20% or greater. Only 37% of all the Russell companies are “W” companies.
 
One hundred and ten companies have female board chairs. The percentage of women on their boards is 28.1% compared to male board chairs at 15.5%.

In Russell 3000 companies, there are 4,082 board seats held by 3110 unique women: 2242 (72%) of the women are on only one Russell 3000 board; 574 (18.5%) are on two boards; 225 (7.2%) on three boards; 64 (2.1%) on 4 boards; and 5 (.2%) on 5 boards. Many nominating committees of Russell 3000 companies have looked beyond a small group of “elite” women directors and found new, untapped talent.

Our research shows that women in corporate leadership positions impact the diversity of the boards of their companies. We call on male leaders to learn from their female colleagues and reap the benefits that a truly diverse board brings. 

To view the full report, click here.

Women and Finance: Roadblock to a board seat? Maybe not so much.

 
We often hear that women need to step up their understanding of finance to land a seat on a corporate board. But, according to the study "Financial Literacy Around the World: An Overview", published in 2011, women seem to know as much as men when it comes to matters of finance. What they often lack is a command of the language of finance, which would make it easier for them to join the conversation in the boardroom.
 
According to the study's author, Annamaria Lusardi, a professor of economics and accountancy at George Washington University, women were less likely to answer questions correctly when financial jargon was used, but that didn't necessarily mean that the women were more ignorant. Women relied on the "do not know" option far more often than their male counterparts. But when the "do not know" option was eliminated, women were no more likely to pick a wrong answer than men. Said Lusardi, when "forced to pick an answer, women seemed to know as much as men."
 
This finding supports the notion that women are more cautious and more risk averse. "Women," said Dr. Lusardi, "are aware of their lack of knowledge while men are less willing to admit what they don't know." Cultural stereotypes add to the pressure men feel that they must be financial experts and have convinced women that they know less than they actually do.
 
Formal education hasn't kept pace with the complexities of modern investing, notes Meg Thakor of MoneyZen Wealth Management. Men and women are confused, but women may be more willing to ask for information.
 

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