Institutional Investors, Leading Women’s Organizations Urge S&P 500 Companies to Add Women to Their Boards
“Thirty Percent Coalition” Wants Women to Hold 30% of Corporate Board Seats By 2015
Boston, MA///June 29, 2012///A large number of institutional investors with approximately $1.2 trillion in assets under management, along with representatives of some of the nation’s leading women’s organizations, yesterday sent a letter to the 41 companies within the S&P 500 Index1 that do not have any women on their boards of directors, urging them to embrace gender diversity by adding women to their boards.
The Thirty Percent Coalition, a coalition that includes senior business executives, statewide elected officials, national women's organizations, institutional investors, labor unions, corporate governance experts, board members and others, which was formed in late 2011 to address the lack of gender diversity in corporate boardrooms, organized the initiative and letter. The Coalition has set a goal of women holding 30% of board seats across public companies by the end of 2015. According to reports by Catalyst, ION and Governance Metrics International, women only hold roughly 12 - 16% of corporate board seats today.
“We must do better,” say the signatories in their letter, which asks companies to work with them to bring the number of women on corporate boards from where it is today -- with women holding somewhere from 12 to 16 percent of board seats -- to a point where women will hold 30 percent of board seats by the end of 2015.
The letter was sent to the 41 companies within the S&P 500 that do not have any women on their boards (see attached list), a group that includes such nationally-known companies as Chesapeake Energy, Urban Outfitters, Expedia, Teradyne and Federated Investors. In the letter, the signatories cite studies demonstrating a correlation between greater gender diversity among corporate boards and management, good corporate governance and long-term financial performance.
According to the Thirty Percent Coalition, this is the first time that large institutional investors and national women’s groups have joined forces to press companies to improve their governance by adding gender diversity to their boards.
“Women’s groups across the nation have long fought for gender equality, and institutional investors have long been interested in good corporate governance and long-term investment returns,” says Thirty Percent Coalition Project Leader Charlotte Laurent-Ottomane. “What’s new today is that substantial research underscores the correlation between gender diversity, good governance and positive long-term corporate performance. We are urging the business community to embrace this elemental truth.”
The letter references quotas being adopted in numerous countries around the world to increase the number of women on corporate boards but proposes instead that companies in the U.S. voluntarily embrace more ambitious diversity goals because it makes business sense.
”We are not advocating for quotas,” says Joe Keefe, President and CEO of Pax World Mutual Funds and Chair of the Coalition’s Institutional Investor Committee. “We are simply urging companies in general, and these 41 companies in particular, to do better when it comes to inclusiveness and board diversity. Three years from now, we would like to see 30% of corporate board seats held by women. This is a modest, reasonable goal when women comprise over half of the workforce, a majority of college graduates and grad students, own 40% of American businesses and are the breadwinners or co-breadwinners in two thirds of American households.”
Signatories to the letter include several statewide elected officials on behalf of public retirement and pension funds in California, Connecticut, Massachusetts, Maryland, New York, Pennsylvania and Washington, mutual funds and other asset managers, the AFL-CIO, non-profit foundations, religious institutions and many of the nation’s leading women’s organizations, including the National Council for Research on Women, the National Council of Women’s Organizations, the American Association of University Women and Feminist Majority.
The Thirty Percent Coalition promises not to stop with this letter. “We intend to follow up and engage with each of these 41 companies, asking them to join the rest of the S&P 500 in welcoming women to their boards,” says Anne Sheehan, Director of Corporate Governance at the California State Teachers Retirement System (CalSTRS), one of the signatories to the letter. “Whether it’s in dialogue with management, through shareholder resolutions, or related strategies, we intend to press for change. And then we’ll move beyond the S&P 500 to other companies as well. Our goal is to continue engaging companies until women hold at least 30% of corporate board seats across the United States.”
About the Thirty Percent Coalition
The Thirty Percent Coalition is a group of industry leaders, including senior business executives, statewide elected officials, national women's organizations, institutional investors, corporate governance experts and board members who believe in the power of collaborative effort to achieve gender diversity in public company boardrooms, and in the necessity of attaining at least 30% multicultural female representation across public companies by the end of 2015. For more information visit www.30percentcoalition.org.
Thirty Percent Coalition
Treasurer and Receiver General
Chairman of the Pension Reserves Investment Management (PRIM) Board
Commonwealth of Massachusetts
1The S&P 500 Index is an unmanaged index of large capitalization common stocks. Investors cannot invest directly in any index.