Catalyst

The Proof is in the Numbers

We are often asked for stats reflecting the benefits of putting women on corporate boards, so we were delighted (but not surprised) by the results of Catalyst's latest report on corporate performance and women's representation in the board room. The short story: Companies with women board directors (WBD) outperform companies with few or no women board directors.

Catalyst analyzed financial data for 524 companies reported in the Fortune 500 between the years 2005 - 2009. Performance measures included Return on Sales (ROS), Return on Equity (ROE) and Return on Invested Capital (ROIC).

According to Catalyst, companies with the most women directors (on average, 25% WBD) outperformed those with the least (on average, 4% WBD) in two areas, ROS and ROIC.

Catalyst also compared financial performance for companies with 3 or more WBD (48) with those with zero WBD (24). Companies with sustained high representation of WBD (3 or more in at least four or five years) out performed companies with sustained low representation (zero WBD in at least four of five years.)

ROS  by 84%

ROIC by 60%

ROE  by 46%

The proof is in the numbers. It’s time for a new definition of board diversity: 20% or more women directors. Companies that maintain the status quo - all white male boards - run the risk of being left in the dust.

 

To see the report, go to: http://www.catalyst.org/file/445/the_bottom_line_corporate_performance_and_women's_representation_on_boards_(2004-2008).pdf

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