Number of women on Fortune 500 boards grew by a record 10% from 2016 to 2017
- Women's presence on Fortune 500 boards has soared in recent years, according to Heidrick & Struggles' 2018 Board Monitor. The number of women directors rose from 28% in 2016 to 38% in 2017. Using what Heidrick & Struggles called a three-year trailing average method to pull out the 2017 data, the firm forecasts that women directors will reach parity with men by 2025.
- About 36% of newly appointed board members in 2017 had no previous director's experience, a sharp increase from 25% in 2016, possibly due to the pressure to diversify boards. Fewer CEOs, both current and former, made up director appointments in 2017, from 50% in 2016, down to 47%, according to the report. The number of black executives appointed to boards rose from 9% to 11%, with most directors serving on industrial boards.
- Despite the record increases in the number of women on Fortune 500 boards, the gender composition overall improved only slightly, up 1.2% in 2017 over 2016. This data indicated that most of the new women directors were replacing women who had left the boards, the report said.
For diversity and inclusion to take off within an organization, it is as vital for D&I efforts to flourish at the top of a company as among the rank and file. When companies fail to cultivate diversity or neglect to nurture inclusion, they may miss out on big strides they could be making. A North Carolina Sate University study, for example, found that a diverse workforce in terms of gender, race and sexual orientation can perform better at developing innovative products and services.
HR executives may want to reflect on their organizations' hiring habits — are they passing over or overlooking some underrepresented groups on the directors' level? On all other levels? HR professionals have the expertise and analytical tools to find out where employers are falling short in their board appointments and hiring practices. However, shareholders, C-suite executives, recruiters and hiring managers must be careful not to focus exclusively on bringing onboard one group at the expense of another.
As employers consider their hiring strategies and general state of diversity, they must beware of "silver bullet" solutions. Changing company-wide cultures and ingrained behaviors to advance D&I in the workplace starts with education, as Diversity Best Practices (DBP) revealed when it released its first Inclusion Index. The index showed that, of the 33 featured companies, all of them provided education on implicit bias. A vast majority (85%) educated emplyoees on generational diversity, 82% educated on sexual orientation and 70% educated on gender and racial/ethnic differences in leadership styles and communication.
- Heidrick & Struggles Women Board Director Appointments Hit Record High