A new study published by the Diligent Institute has revealed that women directors rise to board leadership roles quicker than men, despite the gender imbalance that persists in today’s boardrooms. Although women occupy just 22% of board seats, the few women who make it onto public company boards and take on leadership roles – including board chair, lead director, and committee chair positions – do so at a much faster pace than their male counterparts, according to the study of nearly 6,000 public companies.
Entitled A Few Good Women: Gender & Inclusion in Public Company Board Leadership, the reports reveals that women directors assume corporate board and committee leadership roles up to two years faster than men, despite occupying only 7% of Board Chair and Lead Director roles, globally.
FAST ASCENT
When it comes to board leadership, the data shows that men (45%) and women (40%) are nearly as likely to directly join a board as the Chair or Lead Director. For directors who did not join the board in a Chair or Lead Director role, but eventually achieved one, the report found that female directors reach those leadership positions faster than their male counterparts. It takes women board members on average 6.31 years to be elevated to a leadership role, as opposed to 8.02 years for men. This 20-month difference provides some evidence that companies are actively seeking fresh perspectives in leadership roles and therefore working to build a more inclusive culture, according to the Institute.
“This report falls on the heels of International Women’s Day, and the findings mark some encouraging signs of progress that should be celebrated,” stated Diligent’s CEO, Brian Stafford. “Obviously, there’s still a lot of work to do in bringing more diversity to boards and corporate leadership, but it’s inspiring to see the number of women who are joining boards are taking critical leadership roles.”
‘THOUSANDS’ READY TO LEAD
“Diversity brings unique perspectives and expertise companies need to thrive – and diverse candidates represents a still largely untapped talent pool for corporate leadership roles,” added Stafford. “Diligent encourages companies to take note of this modern governance best practice and expand their networks – there are thousands of women board candidates who are absolutely ready and able to assume leadership roles.”
The report also suggests a growing number of companies are willing to onboard women candidates who do not bring previous CEO or public director experience to their board roles. Rather than penalising women for this, these companies are recognising the specialised skill sets and perspectives diverse candidates bring, including digital technology expertise, specific legal or HR knowledge and experience in implementing ESG and sustainability programmes, the study notes.
At present, however, women occupy just 24% of all board committee seats and 21% of board committee chairs. According to Dottie Schindlinger, Executive Director of the Diligent Institute, “While the total number of women on boards is still small, women directors are highly engaged in committees – including the Audit Committee, which is often thought of as a ‘power centre’ for the board. It will be interesting to see if this trend continues as women begin participating in public company boards in greater and greater numbers.”
The Diligent Institute, the research arm of Diligent corporation, provides industry-leading research on global board governance to over 17,000 organisations and 650,000 leaders worldwide.
Click here for a copy of the report.
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