The process of diversifying corporate boards is a journey where the companies, shareholders and executives pursue a path leading to a balanced board room and to increased shareholder value. Business and academic studies indicate that companies with significant diversity on their boards, as well as in the executive suite, have superior financial performance as compared to those companies without diverse boards.
This year’s census results are encouraging, but not dramatic. Real challenges still exist in the journey to diversity. Notable conclusions from the study are below and the complete study is available at: http://theboardconnection.org/
o Only 11% of director seats in FORTUNE 1000 companies in Texas are filled by women, which is below the national average 16%.
o Only 2% of board seats were held by women of color.
o Texas FORTUNE 1000 companies showed neither improvement nor decline in the percentage of director seats held by women; however the smaller companies on the list (ranked 501-1000) showed improved numbers, offset entirely by declines in the larger companies (ranked 1-500).
o Consumer markets, technology/telecom, and financial services/insurance continue as the industries with the highest percentage of board seats held by women; in those industries the results exceed the overall percentage of all Texas FORTUNE 1000 companies.
Executive Compensation Trends
o In an encouraging trend, Texas FORTUNE 1000 companies with NO women among highest compensated executives dropped 4.1 percentage points year over year.
o Nationwide results mirror Texas, where women among highly compensated executives increased from 5.8 to 6.4 percent.
o The consumer markets experienced real improvement of women among the highest compensated executives, gaining 3.8 percentage points over last year. Companies leading that effort are Men’s Wearhouse, GameStop and Radio Shack.
o The energy and industrial sectors have the lowest percentage of women on boards and lowest percentage of women among highly compensated executives.
“I can attest to the fact that diversity on our Board has been key in contributing to our growth and success," said Pamela H. Patsley, chairman and CEO of MoneyGram International and board member of Texas Instruments Incorporated and Dr Pepper Snapple Group, Inc. “Clearly, successful boards are made up of well-qualified professionals with diverse backgrounds and experience. Boards are further enhanced if they can also achieve diversity through gender, race, and nationality.”
The Board Connection’s 2011 Study of Women Directors and Executive Officers for Texas is based on the 94 companies in Texas identified as FORTUNE 1000. The KPMG Market Research team compiled the data for the study from the most recent Securities and Exchange Commission (SEC) filings, including annual reports (form 10-Ks) and Proxy statements (DEF 14A’s). For the majority of companies, the most recent filing was as of fiscal year ending December 31, 2010. In previous census reports, The Board Connection captured results for the FORTUNE 1000 companies in DFW in 2009 and for the state of Texas in 2010.
Gayle Anderson, Executive Director of The Board Connection, remarked "while the census study shows little improvement between 2010 and 2011, we are seeing recent indications that more companies are recognizing the extent to which board diversity improves corporate results and brings higher financial performance. Subsequent to their SEC filings studied for the census, several companies, including Dr Pepper Snapple Group, Inc. and Dell Inc., further increased the number of women on their boards.” Ms. Anderson further stated, “The Board Connection is working to impact these results by providing corporations with access to qualified candidates and by providing women interested in board service with the tools to obtain visibility to nominating committees and excel in board service once selected.”
Corporate sponsors for The Board Connection include KPMG LLP, TXU Energy, BNFS Railroad Company and Thompson & Knight LLP. The Board of Directors and officers of The Board Connection are listed here: http://theboardconnection.org/
Established in 2009 as a Texas-based non-profit organization, The Board Connection identifies, educates, and connects qualified executive professional women in Texas to serve on corporate boards. As the pipeline of qualified female board candidates continues to grow, The Board Connection is poised to provide the resources and opportunities for candidates to further their network, develop their personal brands and gain board readiness. The Board Connection is part of the InterOrganization Network (ION), a national alliance of 14 regional women’s business organizations to advocate the advancement of women to positions of power in the business world, especially to boards of directors and executive suites. The Board Connection is also aligned with Women Corporate Directors and the National Association for Corporate Directors.
Learn more about the qualifications for membership and The Board Connection events at http://www.theboardconnection.org.
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