Good news dept.: Industry ahead on female directors
Tuesday, January 7, 2014
Posted by: Barbara Francella
Barb Grondin Francella
The wheels of change turn slowly, but when profits provide a push, they turn a bit faster.
As the NEW "Women 2020" report revealed,
women are still greatly underrepresented in leadership roles in the retail and
consumer goods industry, but the business case for gender equity is strong -- and
savvy organizations are getting on board.
A new study supports the "Women 2020" findings and shows the retail/consumer goods industry taking the lead in
recognizing the business benefits of female leadership.
Nearly 80 percent of the world’s largest
retail/consumer goods companies now have at least one woman director, according
to "Women Board Directors of Top Retail and Consumer Products Companies
Globally,” a recent report by Corporate Women Directors International (CWDI)
that studied 168 retail/consumer goods companies with at least $1 billion
annual revenue in 26 countries.
This industry has more gender diverse boardrooms
than the Fortune Global 200 community, where 76.5 percent of companies have one
or more female directors. In fact, no industry has a higher percentage of
companies with women board directors. Healthcare holds the second spot, with
72.3 percent of its 100 largest firms boasting at least one woman director.
One is nice, but more is better. The retail/consumer
goods industry also outperforms the Fortune Global 200 in the depth of women’s
board representation. Eighteen percent of the industry’s directors are women, compared
to 15 percent serving on Fortune Global 200 boards.
companies take action
While relatively few women are promoted to
top positions — only seven women held CEO posts in the retail/consumer goods
companies studied worldwide — U.S. organizations, especially, are going
beyond tokenism in the boardroom. Among the 15 global companies with the highest percentage of
women directors are U.S.-based Avon Products, ranked first with women in 60
percent of its board seats, and NEW sponsors Procter & Gamble, Hormel Foods
Corporation, Campbell Soup Company and General Mills Inc., which all have at
least one third of their board positions held by women. Estee Lauder, Macy’s,
Williams-Sonoma, TJX Inc., PVH Corporation (Calvin Klein, Tommy Hillfiger and
other brands), Coach Inc. and Foot Locker do, too.
This is good news for women, for investors
and the bottom line. As Catalyst reported in 2011, companies with three or more
female board members saw an 84-percent higher return on sales, a 60-percent
higher return on investment capital and a 46-percent higher return on equity than companies with no female board members in at least four of the five years
Change, of course, starts at the top. Having
a woman at the helm makes a huge difference in the makeup of a company’s leadership. The CWDI report backs this up: Companies with a woman CEO or board chair have almost double the
percentage of women on their boards than its survey’s average — 35.8 percent
vs. 18.4 percent.
Still, retail/consumer goods companies —
especially retail companies — are still a long way from achieving gender
parity. Women hold 16.2 percent of board seats at the world’s largest retailers,
compared to 22 percent at consumer products companies. At food retailers, women
represent just 13.6 percent of board directors.
report is full of numbers to chew on. But considering the many business benefits
of gender diversity — more (and often more relevant) views sparking innovation, a
leadership team that reflects customers, a stronger reputation as an employer
to attract top talent, and a larger talent pool to draw from — many of the numbers are still hard to swallow.
Barbara Grondin Francella is communications manager for the Network
of Executive Women.
Views expressed in signed blogs and user comments
are those of the authors and do not necessarily reflect the opinions of the
Network of Executive Women or its Officers, Board members and sponsors.
"How a 'nurturing nature' holds some women back"
and other Women 2020 blogs