ICYMI: Women on Corporate Boards

Research by 50/50 Women on Boards reveals that women currently hold approximately 29% of seats on the boards of the Russell 3000 index companies, with women of color making up about 7%. The increase from 25.6% in 2021 to the current figures shows progress, yet there is a strong business case for boosting the number of women on corporate boards. Companies with greater gender diversity at the board level are often linked to better financial performance, enhanced creativity, and improved governance, making a balanced board composition a strategic advantage in today’s competitive marketplace. 

In the November 2023 DEI Leader Network (DLN) Live Event, Managing Partner at Diversity Works Holly Wittenberg spoke with leadership experts Alice Beverly Cole, Kathryn McDonald, and Mary McDowell about how women on boards and in committee chairs correlate with improved financial performance and shareholder value, innovation and problem-solving, and competitive edge. and the experts also discussed how women can position themselves to gain a seat at the table. 

Our panelists highlighted the distinct contributions of women to corporate boards, detailing how their presence bolsters innovation and profitability through a multitude of key factors.  Ultimately, gender diversity on boards is not just a metric of equality but a strategic asset that can drive innovation and profitability. In case you missed the live event, you can watch the recording here.

Some key insights shared by our panelists include: 

 Power in Three or More 

Having just one woman on a board is a start, but research indicates that having at least three women can normalize their presence, leading to more robust discussions and decision-making. Companies with higher female representation not only enjoy better financial outcomes but also benefit from enhanced innovation and stronger governance. It’s more than an equity issue; it’s a strategic business necessity to cultivate a competitive edge 

 Enhanced Corporate Governance. 

Women enhance board discussions with robust deliberations that mitigate the risk of groupthink. They provide alternative insights based on their varied life experiences, contributing to a more holistic view on consumer behavior, employee engagement, and market strategies. This, in turn, results in decision-making that is well-rounded and inclusive of diverse stakeholder needs.   

Innovative Problem-Solving. 

Board diversity brings a breadth of experiences that are crucial for innovation. Their unique perspectives are not only valuable for addressing routine business matters but are especially vital in navigating unforeseen challenges, contributing to the ideation and problem-solving processes that can lead to breakthroughs in business. {should we link to the short video here] 

Resilience and Adaptability in Difficult Times. 

Research conducted by Kathryn McDonald showed that companies with diverse boards outperformed during a recent economic downturn. Although these companies were also negatively impacted by the downturn, they performed better than their peers.  This analysis indicates that diverse boards are quick to adapt to market changes with innovative strategies that maintain or even improve revenue streams in challenging times. 

Advocacy for Ethical Practices. 

Research shows that women on boards often champion ethical practices and governance, fostering investor confidence. Their presence signals a commitment to governance that prioritizes diverse viewpoints, which is frequently linked to strong, ethical leadership. 

Resources: 

Diversity Works Summary of the McKinsey 2023 Report: Women in the Workplace

 About our Panelists:

Alice Beverly Cole 

Alice Beverly Cole serves as a public, private independent board member. Her current board committees are Enterprise Risk and Chair of the investment Committee of a VC firm. She has a broad background as a former investment banker, corporate lawyer, advisor to portfolio companies in the sustainable, real estate and vertical grow vegetable space. She was selected to the Federal Reserve of San Fran EAC committee, recently to the SBA Investment Capital Advisory Committee, Global Women Think Tank and has served on boards of National Park Foundation and Medical School. 

Kathryn McDonald 

Co-Founder and Head of Investments & Sustainability, Radiant ESG Global Investors LLC 

Kathryn is the co-founder of RadiantESG Global Investors, a female-owned, independent asset management firm focused on next generation ESG and impact investment opportunities for institutional and wealth management clients worldwide. She was previously the Head of Sustainable Investing at Rosenberg Equities, overseeing the integration of ESG information in Rosenberg’s investment process and leading the firm’s ESG and impact research effort. Earlier in her career at Rosenberg she held positions in portfolio management, applied research, and was the Head of Investments for Australia/NZ. Kathryn holds an undergraduate degree in Economics from Willamette University, and a Master of International Management from Thunderbird, The American Graduate School of International Management. She is also the founder of Aquanos Collective, a water research platform, a member of the Board of the Responsible Investment Association of Australasia (RIAA), a member of the Bretton Woods Committee, and a member of the Stewardship Council for the ACT Standard of Corporate Culture created by City Hive UK. 

 Mary McDowell 

Over her 30 years as a technology industry executive, Mary McDowell has been privileged to lead global, multi-national organizations through significant business and technology transformations. She is the former CEO of Polycom, the former Chair and CEO of Mitel Networks and former Corporate Officer and Division President at Nokia and Compaq Computer. She currently serves as Independent Director and Compensation Committee Chair for Autodesk, the world leader in 3D design, engineering, and entertainment software and services. She is also on the board of Arrow Electronics, a Fortune 500 technology distributor, and is the Senior Independent Director for the Informa Group, a FTSE-100 international events, digital services and academic knowledge company based in London.