Women and minorities are occupying more seats at corporate boardroom tables than they were four years ago and now hold 30.8 percent of board seats among 492 Fortune 500 companies studied by the Alliance for Board Diversity, a collaboration of four diversity organizations.
But at this rate of growth, it will take almost a decade before women and minorities occupy 40 percent of those decisionmaking seats, the report found.
That’s a major missed opportunity in connecting with consumers and expanding operations, said Ronald C. Parker, chairman of the Alliance for Board Diversity.
“What company do you know [that] would be willing to wait 10 to 15 years to take opportunities for growth?” he said.
The percentage of female board members was 25 percent in 2012.
So the latest numbers are an uptick, but moving about as slow as a glacier, said Deb DeHaas, chief inclusion officer at Deloitte, which collaborated on the report. Slow turnover on boards partly contributes to that tepid growth, as well as failure to go outside normal business circles to tap talent.
Planning could help accelerate that growth, DeHaas said. Companies could keep an eye on which board member will retire next, and start priming someone for the role, like they do with other C-suite positions.
Another study, this one by research firm Equilar, found the number of directors at publicly traded U.S. companies held by women is ticking up about 1 percent a year. As of Dec. 31, that number was just over 15 percent, up from 14 percent in 2015.
Minnesota companies run the gamut of representations. For instance, UnitedHealth Group’s 11-member board has two women. 3M’s 12-member board has two as well. At Best Buy, four of 10 board members are female, and at Target, five of 13 are women.
A board lacking women and minorities often fails to reflect the diversity of the company’s workforce, and can be misaligned with the consumers it serves, said Cid Wilson, president and CEO of the Hispanic Association on Corporate Responsibility, one of the member companies of the Alliance for Board Diversity.
Imagine the buying power Latinos have in America, Wilson said. If a company’s board lacks a Hispanic member, that company will have a much harder time tapping into that buying power.
“Without a diverse board, you are handicapping your company,” he said.
Ally Marotti writes for the Chicago Tribune.