Leadership advisory firm, Egon Zehnder has recently released the results of its 2020 Global Board Diversity Tracker.
According to the study, it was found that while there is progress in gender diversity globally, the rate of change is insignificant. Despite increased attention to diversity and inclusion that has sparked conversation and movement, making tangible progress is still challenging.
Another urgent charge, beyond the need to increase the rate of diversity expansion, has emerged – the mandate to rethink the culture and dynamics of boards. To foster active participation from new members, companies must move from only adding or turning over seats to increasing action and output as an inclusive unit.
Jill Ader, chairwoman of Egon Zehnder said: “Today, we see attention and acknowledgment that we need more diverse boards; however, diversity spans far beyond gender. It is now more important than ever to move beyond traditional D&I metrics – and prioritize building teams that are representative of all different backgrounds. Board leaders have the power to modernize governance with a few bold steps. Change is within our grasp.”
Some of the key findings from the report were:
- This year, 89 percent of major companies have at least one woman on their board, up from 85 percent in 2018.
- In India, that number is higher, with 96 percent of companies in our survey having at least one woman on their boards. (India requires public companies to have at least one female director.)
- Between 2012 and 2020, India has seen an 8.6 percent increase in the percentage of women on boards, with women holding 17 percent of board positions in 2020.
- 18 countries, up from 13 in 2018, have on average three or more women on the boards of their largest companies.
- In India, 23 percent of large company boards average at least three women, up by 10 percent from 2018.
- The survey found that 20 percent of female directors in India hold more than 1 board seat compared to 8 percent of men within our sample. This mirrors the global finding that women are slightly more likely to hold multiple board seats than men.
Women now make up 27.3 percent of all board committee leaders globally, up from 25.5 percent in 2018. In India, women held 11 percent of committee chairs. However, women comprise just 2.1 percent of all board chairs, up from 1.5 percentin 2018.
India fared better than Asia as a whole in the diversity of both executive and non-executive chair roles, with 5 percent of executive chair roles filled by women in India and 10 percent of non-executive chair roles respectively. (Those numbers stand at 2.6 percent and 5 percent, respectively, in Asia.)
Globally, new board appointments made up 13.5 percent of all board positions in 2020, up from 11.4 percent in 2018. Of that number, 30 percent were women, up from 27 percent in 2018. In reality, this means that only 4 percentof all directors are women new to the board, only a 0.9 percent increase from 2018. In India, women comprised 16.3 percent of new board appointments.
The focus now, appropriately, looks to expand to ethnic and racial diversity, in the United States, for example, Black directors make up just 4.1 percent of all directors in the Russell 3000 index.
In the UK, the Parker Review Committee, a non-profit executive group, set a target for FTSE 100 companies to have at least one non-white corporate director by 2021 and for the FTSE 250 to do the same by 2024. As of early 2020, 37 percent of the FTSE 100 companies reporting results did not have such representation on their boards, and just 54 percent of FTSE 250 companies had reached that goal.
In 70 countries, being openly LGBTQ+ remains illegal. Even in the U.S., where many protections have been implemented for LGBTQ+ individuals, just 24 of the more than 5,000 board seats in the Fortune 500 index are openly LGBTQ+, according to Out Leadership. Of that tiny number, only two are people of color, and zero is women of color.