Women, who make up half the American workforce, would be 40 years from parity with men on U.S. corporate boards even if female directors filled seats at twice the current rate, the U.S. Government Accountability Office said in a new report.
About 23 percent of open seats in the Standard & Poor’s 1500 Index went to women in 2014, according to the GAO. If that figure rose to about 50 percent — or half of all openings — boards would be evenly split between women and men by roughly 2055, the report said. Women held about 16 percent of board seats in the S&P 1500 in 2014, up from 8 percent in 1997.
“There are ways we can move faster,” said Susan Stautberg, chairman and chief executive officer of the Women Corporate Directors Foundation, which advocates for more women board members. “We can set goals, we can focus on mentorships and succession. You can’t just sit back and play it safe anymore.”
European countries including Sweden and France have imposed quotas to get more women on boards, and the U.K. has moved the needle with a non-binding push from the government and public commitments by corporate chairmen. The U.S. has resisted regulation to speed up gender equality on boards. More than 350 of 1,846 public companies have no women and another 628 have only one, according to 2020 Women on Boards, a Boston-based group.
The GAO, which did not make recommendations in the 38-page report, said several factors inhibit more rapid change, including a lack of women in executive positions and low turnover of board seats. About 600 board seats change hands each year among the S&P 1500, or about 4 percent of the total.
The report highlighted the U.S. Securities and Exchange Commission’s effort to study whether better company disclosure of board and leadership diversity would help speed the process. Funds representing about $1.12 trillion in investments, including the California Public Employees Retirement System and the New York City comptroller’s office, petitioned the SEC in March to require more disclosure, including gender details, for board nominees.
In the S&P 500, women made up 31 percent of new directors last year, taking 117 of the 376 board seats that changed hands, the most ever in a year, according to executive recruiter Spencer Stuart. Women held 22, or 4.4 percent, of the CEO jobs in that index.
Women are also moving to the top faster in family run companies, Stautberg said. Those dominated by hedge funds, private equity and venture capital remain far less diverse in the board room, she added.
“If we don’t get this fixed, we’re going to be left behind by companies in other countries that are doing it,” Stautberg said.