- Of 900 board seats in 95 companies, women held 152, or 16.9%. This is an increase in women board members over 2015, when women held only 15% of seats.
- The 19 NJ Fortune 500 companies within the NJ Russell 3000 did slightly better, with 51 of 216 board seats, or 23.6%, filled by women. This is an increase over 2015, when women in these companies held 22.3%.
- 21 of the 95 companies, or 23.2%, had no women directors. In 2015, this was true of 25%.
- All of the 19 NJ Fortune 500 companies in the Russell 3000 had at least one woman director. This was also true in 2015.
- Only one of the 95 New Jersey companies in our sample has reached 50% board membership for women. American Water, whose CEO Susan Story, was featured in our 2015 report, has surpassed this mark, with women holding 55.6% (5 out of 9) of board seats.
Why Gender Diversity Matters
- Companies with at least one woman director had better share price performance than those companies without women for the last 6 years.
- The Credit Suisse report compared companies with less than 10% women in senior management to those with 15% or more and found a 52% higher return on equity and a 22% higher ratio of dividend payout for companies with more women in the ranks of senior managers.
- Companies with more women on their boards not only have stronger financial performance but also fewer governance-related issues such as bribery, corruption, shareholder battles, and fraud according to research by State Street Global Advisors, one of the largest investment management firms in the world.
- The appointment of women-directors is associated with earlier adoptions of practices such as director training, board evaluations, and director succession planning structures.
Recommendations for Change
- Companies must commit to including at least one woman for consideration on every slate.
- Boards should utilize a skill set inventory to identify gaps in knowledge not covered by existing members.
- Board directors should identify senior and mid-level women in their companies who have the potential to serve as board directors.
- Boards should adopt strategies to minimize bias in the selection and evaluation of board candidates.
- Companies should adopt strategies to refresh their boards.
- Companies should consider adopting transparent governance principles like those endorsed by the Investor Stewardship Group.
This summary represents only a small fraction of the compelling information and enlightening statistics EWNJ uncovers in this year’s report.