According to the Alliance for Board Diversity in collaboration with Deloitte, Fortune 500 companies with more than 40% diverse board members have more than doubled in six years.
The study entitled “Missing Pieces Report: The 2018 Board Diversity Census of Women and Minorities on Fortune 500 Boards” showed that almost one-third (145) of all Fortune 500 boards have greater than 40% diversity in 2018. The number in 2012 was only 69.
Linda Akutagawa, chairwoman for the Alliance for Board Diversity and president and CEO of Leadership Education for Asian Pacifics commented that, “It’s indicative of a change being made. Stakeholders are seeing the value of diverse perspectives on boards, and we’re seeing them be more vocal for greater diversity.”
Ms. Akutagawa boasted too that “There’s actual data showing that boards with diversity actually are seeing better innovation, better market performance.”
For her part, Deborah DeHaas, vice chairman and national managing partner of the Deloitte Center for Board Effectiveness, said that this is “the highest level of diversity achieved thus from the time recording started in 2004.” The pace of change she said is accelerating.
Ms. DeHaas went on to say that, “Given the environment that companies are operating in today, the world’s getting increasingly complex, and there’s extreme value in bringing diverse skills and experiences needed to address complex business issues to boards and executive leadership ranks.”
Apart from these findings, the study revealed that Asian/Pacific Islander women and African-American/black women comprised the largest percentage gains in board seats. That is for the Fortune 100 and Fortune 500 and significantly larger than any other group or gender.
The increase in seats by Asian/Pacific Islander women in 2018 was 38.6% while the number of seats that went to African-American/black women was 26.2%. This same study was conducted in 2016.
The progress of women and people of color taking board seats in Fortune 500 companies between 2016 and 2018 is clearly far better than the period between 2012 and 2016. More so, the representation of women and minorities in the Fortune 100 has touched a high of 38.6% and has overtaken the 34% registered by the broader Fortune 500.
The study further said, “Despite some notable gains, women and minorities remain underrepresented in the boardroom,” with 71 non-white women holding board seats and 167 non-white men having seats, compared to 750 white men being board members of Fortune 100 companies. Ms. Akutagawa noted that although progress is being made, “There’s still work to be done.” She pointed out that “underrepresentation is still a key issue, citing that more than 50% of the new directors that assumed the posts between 2016 and 2018 were white men.