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Fortune 500 Companies Step Up to Appoint More Women on Boards

Bizwomen
Marie Leech

May 12, 2022

Fortune 500 boards appointed a record number of women in 2021, although Latinx, Asian and Asian American women continue to be underrepresented, according to a new report released by executive search firm Heidrick & Struggles.

The 2022 Board Monitor report found that 45% of the 449 board seats filled in 2021 were women directors, up from 41% the previous year.

According to the report, global events like the pandemic, climate change, increased calls for racial and social justice, and the war in Ukraine have prompted corporations to focus more attention on “organizational purpose.” In response, the report states, Fortune 500 boards of directors notably shifted to bringing in a wider range of experience, including more directors who are women, diverse and serving for the first time in the boardroom.

“Boards continue to seek fresh thinking as evidenced by the appointment of directors with more diverse backgrounds,” said Bonnie Gwin, vice chair and co-managing partner of Headrick & Struggles’ global chief executive officer and board of directors practice. “And the truly cutting-edge boards are taking a strategic, holistic approach to board succession by continuously monitoring refreshment opportunities to meet today’s challenges and respond with resilience when the unexpected occurs.”

While the number of women board members continues to trend up – 29% of all directors on Fortune 500 boards are women, up from 19% in 2015 – the number of Asian/Asian American and Hispanic/Latinx directors continue to be underrepresented at 9% and 6%, respectively. Those percentages have not risen in recent years, the report found.

“We are encouraged to see the trend toward more equitable representation on boards,” said Lyndon Taylor, regional managing partner of Headrick & Struggles’ North American CEO and board of director practice. “We expect that more progress will be made on DEI (diversity, equity, and inclusion) when diverse directors hold more influential board positions, especially as board chair or chair of the nominating and governance committee, but this will require that boards take a comprehensive perspective on diversity from gender experience to continue pursuit of aspiring directors that are racially and ethnically diverse.”

Other notable findings in the report include:

  • While current or former chief executive officers and chief financial officers continue to fill the majority of appointments, the trend is on a gradual decline. In 2021, 40% of appointees were current or former chief executive officers, down significantly from the high of 60% in 2018. Current or former chief financial officers made up 14% of appointments in 2021, down from a high of 21% in 2020. Notably this year, 16% of newly appointed women directors have chief financial officer experience compared to 11% of men.
  • The average age of new board members continues – for the sixth year – to hold steady at around 57, with 64% of the seats in 2021 going to people 55 and older; 6% to those under 45.

Only 31% of Hispanic/Latinx appointments and 33% of Asian/Asian American appointees are women compared to the higher gender diversity among Black (43%) and white (49%) appointees.

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