Around the globe and across all avenues for change—from legislated quotas to an explosion of advocacy groups championing voluntary measures—efforts calling for actions to increase board diversity are approaching a tipping point. The demand for greater gender equality in the boardroom is higher than ever before, and most directors recognize the value of board diversity.1
In several countries, companies are appointing more first-time directors to public company boards, and globally, women are joining corporate boards at greater rates than at any time in recent memory.2 Each of these indicators suggests that the expectation for businesses to diversify their boards is the new norm, and reinforces the importance of women in business.3 More and more, it appears that what may have worked in the past—relying predominantly on "who you know” to fill vacant board seats—will no longer be a viable solution for companies.4
Governments and businesses continue to engage in discussions about the best approach to increase women’s representation on boards. Thus far, efforts affect a variety of companies and have fallen into three distinct areas: legislative, regulatory, and voluntary methods.5 While the advantages and disadvantages of each approach are open to debate, the general consensus is that including more women on boards is good for business.6
Regardless of whether a specific country mandates a quota for women on boards, it is clear that the global movement foreshadows a race for top talent to fill board vacancies. Companies that aren’t addressing the gender diversity of their boards run the risk of being left behind.7
The following maps and tables summarize current approaches to increasing gender diversity on boards, categorized by method and status. This is not an exhaustive list. Catalyst encourages others to share their knowledge to expand and update the tables. For corrections or additions, please contact the Catalyst Information Center ([email protected]). Contents last updated in August 2014.
- Legislative Board Diversity
- Regulatory Board Diversity
- Voluntary Board Diversity
- Legislative Board Diversity – Pending
How to cite: Catalyst. Increasing Gender Diversity on Boards: Current Index of Formal Approaches. New York: Catalyst, August 2014.
- 1. In a 2012 survey of U.S. corporate board members, three-fourths of respondents indicated that their company had taken steps to support and promote boardroom diversity efforts in the past three years, and four-fifths agreed that diversity in the boardroom generally results in increased value for shareholders. The survey was sent to 697 directors on the Corporate Board Member Research Panel and 1,850 Governance/Nominating committee members and chairs of U.S.-based publicly traded companies. Spencer Stuart and Corporate Board Member, 2012 Boardroom Diversity Survey: Summary Report (2012); “Corporate Boards Taking Steps to Promote Diversity,” Spencer Stuart press release, July 17, 2012.
- 2. Tessa Bamford, Julie Hembrock Daum, Malini Vaidya, and Hélène Vareille, In the Boardroom: Recruiting the First-Time Director (Spencer Stuart, 2013); Susan Vinnicombe, Elena Doldor, and Caroline Turner, The Female FTSE Board Report 2014: Crossing the Finish Line (Cranfield University School of Management, 2014); Australian Institute of Company Directors, “Statistics: Appointments to ASX 200 Boards.”
- 3. Global Reporting Initiative and International Finance Corporation, Embedding Gender in Sustainability Reporting: A Practitioner’s Guide (2009).
- 4. Boris Groysberg and Deborah Bell, 2012 Board of Directors Survey (Heidrick & Struggles and WomenCorporateDirectors, 2012).
- 5. Legislation, or “hard law,” is defined as rules that are passed by a government body of elected officials. Regulation, or “soft law,” is defined as rules that are passed by an administrative body that either oversees how laws will be enacted and enforced or oversees recommended conduct for companies. Voluntary efforts are defined as pledges or targets signed by organizations that are not legally binding but signal a public commitment to board diversity. A publicly traded company has held an initial public offering and has shares that are traded on a stock exchange or in the over-the-counter market. Private companies are owned by one or several individual(s), a family, or a parent company and do not trade shares on a stock market. State-owned enterprise (SOE) is a general term for any government owned entity, including federal, state/province, and municipality. Government ownership refers to at least 51% controlling shares. Sheshunoff Information Services, “Public vs. Private Companies and the Accounting Standards,” Internal Auditor Alert (1553-8222), vol. 9, no. 6 (June 2012): p. 1-3; Juliet Roper and Michèle Schoenberger-Orgad, “State-Owned Enterprises: Issues of Accountability and Legitimacy,” Management Communication Quarterly, vol. 25, no. 4 (2011): p. 693-709.
- 6. Nancy M. Carter and Harvey M. Wagner, The Bottom Line: Corporate Performance and Women’s Representation on Boards (2004–2008) (Catalyst, 2011); Lois Joy, Nancy M. Carter, Harvey M. Wagner, and Sriram Narayanan, The Bottom Line: Corporate Performance and Women’s Representation on Boards (Catalyst, 2007); Spencer Stuart and Corporate Board Member.
- 7. Joann S. Lublin, “'Pink Quotas’ Alter Europe’s Boards,” The Wall Street Journal, September 11, 2012.