Mar 8, 2020 - Economy & Business

Women underrepresented in global boardrooms

Source: MSCI All-Country World Index. Note: Reflects boards of 3,046 publicly traded companies based in 46 countries. Chart: Axios Visuals

Female representation on corporate boards around the world has doubled in the last decade. But board members — who play a big role in corporate decision-making, and earn big money for their labors — are still much more likely to be male.

Why it matters: Today is International Women's Day, and — despite unprecedented pressure from shareholders and others to diversify boardrooms — the prospects for gender parity there are bleak. Researchers say it could take another 25 years before there are just as many women as men in boardrooms worldwide.

  • "To achieve the goal faster would require increasing the number of board seats that open up each year and/or appointing women to a higher percentage of the seats that become available," according to MSCI.

Between the lines: Last year saw the biggest annual gain in global board seats held by women since 2009. California's boardroom law — which mandates that all California-based companies must have at least one female director — deserves part of the credit.

  • Outside the U.S., a number of countries, like Belgium, Norway and France, require that companies have a certain number of women on boards.

Shareholder pressure may also be pushing companies to act faster.

  • "Diversity and gender equality have been gaining traction as issues of concern to institutional investors," Meggin Thwing Eastman, MSCI’s research editorial director for ESG Research, tells Axios.
  • Eastman also cites "overall growing social attention" to board diversity as a reason for the boost.

There's progress outside of the corporate world.

  • Take the Federal Reserve. One of the most influential economic policy bodies in the world has taken a lot of flak for being too white and too male. But now, per a Reuters analysis, for the first time in the Fed's 107-year history, white men held fewer than half of board seats at its 12 regional banks.
  • Christine Lagarde became the first woman to head up Europe's central bank last year. Meantime, Ursula von der Leyen is the first to lead the European Commission.

What they're saying: "Incentives to close the gender gap are evident," researchers at Bank of America say in a new report on equality and diversity.

  • Companies "focused on gender diversity at a board, C-suite and firm level have consistently achieved higher [return on equity] and lower earnings risk," the bank found.

The bottom line: While all-male boards are becoming more rare, boards are still dominated by men.

  • The typical S&P 500 board seats four men for every woman, according to Bank of America.

Go deeper: How Wall Street is pushing for more women

Go deeper

Facebook board nears gender parity with two new directors

Photo: Jakub Porzycki/NurPhoto via Getty Images

Facebook has added two new members to its board: Nancy Killefer, a former government official and longtime McKinsey executive, and Tracey T. Travis, the chief financial executive of The Estee Lauder Companies.

Why it matters: The additions double the number of women Facebook directors and make the board 40% female. Despite significant progress in recent years, women still hold just 20% of board seats globally in publicly traded companies.

In mayors' offices, men far outnumber women

Data: Axios research; Chart: Naema Ahmed/Axios

Out of the 50 largest U.S. cities, only 15 have female mayors. That proportion stays the same when looking at the largest 100 cities: 70% of mayors are men.

The big picture: Women are running for office at every level of government. Although Elizabeth Warren's withdrawal effectively ended the chance of electing a woman to the presidency this year, there's progress elsewhere.

Slow progress for female world leaders

Illustration: Aïda Amer/Axios

While the U.S. has yet to break the presidential glass ceiling, 57 countries worldwide have been led by women since 1960.

The big picture: That year, former Sri Lankan prime minister Sirimavo Bandaranaike became the modern world's first female head of state. Finland and New Zealand have led the way in electing women since, with three women leaders each.