From 13.7% in 2010 to 18.3% in 2014, the percentage of women on boards at S&P 500 technology companies has increased, according to a new report from Equilar, the executive, board and governance data firm. That’s the second-lowest representation of females in tech board members of any industry after the basic materials sector.
In general, almost 20% of directors on S&P 500 boards were female in 2014, an increase from 15.7% in 2010, according to the report.
Director of content for Equilar, Dan Marcec, stated that diversity on boards is about more than just ticking boxes. The fact that almost every company in the S&P 500 has at least one woman on their boards – but fewer than one in five directors are female – means that there are many boards that see diversity as a ‘one and done’ type of affair. Although the average board size is almost 11 members, the average number of females on those boards is just over two.
Institutional investors are urging for corporate boards to better mirror the demographics of the individuals their companies serve. The world’s largest asset manager provided guidelines in 2015 that highlighted the importance of diversity on corporate boards.
John Chiang, California State Treasurer and CalSTRS board members wrote earlier this year that it is about making sure companies keep up with a changing customer base. Companies wanting to stay competitive in the world economy will benefit from drawing on various perspectives and experiences that mirror a changing customer base.
One way in which employee morale and productivity is improved is a diverse board makeup. It sends a message to employees that the company is committed to the advancement of minorities and women. Simultaneously, it improves a company’s attractiveness and reputation at a time when investors are more often using various non-financial metrics, such as board diversity, as standard in investment decision-making.
The tech industry in fighting with a serious lack of diversity from the highest corporate ranks to the rank and file.
New attempts are targeting the shortage of females at the top of the tech industry. For example, Boardlist is a database that privately held companies can search to locate female candidates to occupy open board seats. Chairman and founder of Silicon Valley startup Joyus, Sukhinder Singh Cassidy, is spearheading the campaign to increase the representation of women.
According to Equilar, 29 tech companies in the S&P 500 had corporate boards with over one in five women in 2014, an increase from 17 companies in 2010. Frontier Communications was top of the list with five females out of 12 directors in 2014, the sole company to top 40% representation.
According to Equilar, in 2014, five tech companies had no women on their boards compared with 15 in 2010.