There is a distinct need for diversity in skill sets, expertise, experience and viewpoints on boards, driven by evolving strategic goals and market challenges. Board effectiveness demands robust debate in which norms are challenged and a breadth of perspectives inform board strategic discussions and actions. Indeed, a high-performing board is now, by definition, diverse.

In this report, Ernst & Young reviews the progress made to increase gender diversity on US corporate boards by comparing board composition of S&P 1500 companies at the time of the 2012 annual meeting to the 2006 annual meeting. The report focuses on a broad universe of companies to tell a more complete story since the boards of large companies tend to be more diverse. The report is also unique in that it looks at the roles women have once they join boards, and reviews the backgrounds and qualifications of women directors. Overall, Ernst & Young finds that the rate at which women are joining boards as a percentage of new board members is increasing and that boards that already have at least one female director are most likely to add more.

>> Click here to download a PDF of the Getting on Board report from Ernst & Young.

* This article features contributed content and has not been fact-checked or copy-edited by DiversityInc.

The post Getting on Board: Women Join Boards at Higher Rates, But Progress Comes Slowly appeared first on DiversityInc.

By Denyse Leslie, Senior Vice President of Consulting, DiversityInc

“Put your money where your mouth is.” “Home is where the hearth is.” I grew up with statements like these as guideposts of how to live in a community, how to be authentic and consistent, and a reminder to do what I say I will.

In my review of diversity and inclusion on websites, I found a CEO and diversity statement that both demonstrate these ideals.

GRADE A
Prudential Financial, No. 9 in The 2012 DiversityInc Top 50 

John Strangfeld, chairman and chief executive officer of Prudential Financial echoes these sentiments in what he says and does at Prudential and for Newark, N.J., Prudential’s home for 135 years.

From the Prudential homepage, one click takes you to “Our Company,” where the business case for diversity is well presented. Even though Prudential’s website has dual duty and must speak to consumer and institutional markets, the site conveys that it is invested in its people who, in turn, instill confidence and trust among consumer and institutional clients.

The CEO statement begins with “Difference can make all the difference in the world … we succeed through people …” The sentiment continues in the larger The Power of People statement: “Diversity objectives are treated just like anything else in our business cycle.”

Strangfeld’s bio is easily found on the Prudential site, and it reads well. He is what he says he is. He supports higher education and an equal chance. [Watch the video below to hear Strangfeld accept DiversityInc's 2011 Special Award for Top Company for Community Development at DiversityInc's annual event.]

For closed captions via YouTube, click here then press the CC button.

Prudential invests in the communities in which its employees work. Strangfeld has embraced urban economic development and educational access to quality schools—both public schools and charters. He is behind veterans’ re-employment and as suppliers. I’d say Prudential in the person of John Strangfeld is putting its money where its mouth is.

GRADE D
MetLife, No. 50 in the 2012 DiversityInc Top 50

Snoopy is the beloved, welcoming and familiar mascot that greets consumer and institutional customers at the MetLife homepage.

Click to “About MetLife.” It’s all about the products and services with the central focal picture being one mainly of white people. The link to diversity is from this page. There, MetLife connects its business to its diversity commitments through case stories, resource-group initiatives and diversity champions. I particularly liked how the company positions its resource groups “to listen and serve”; resource groups are current-day listening posts.

I was impressed by the MetLife’s board diversity, with professional and life experiences that span leadership of the NAACP to the New York Stock Exchange. Still in pursuit of the CEO’s statement, I found on the Executive Officers page Chairman, President and CEO Steven A. Kandarian’s considerable business accomplishments and his external board commitments. However, the site lacks the CEO statement. MetLife’s diversity commitment is clear, but when the CEO statement is not prominent, it’s not as personal.

GRADE F
Company X

Another consumer-insurance company, which we will not name, has a prominent CEO statement on diversity and inclusion, but it is two clicks from the homepage. The statement, however, is outdated: “Diversity is about being human and doing the right thing.” Diversity is about these things, but it’s also about the changing workforce, the changing customer, investing in the economic viability of cities, and enjoying the full benefits of diversity at the senior-leadership table—diversity of thought.

Throughout the website, Company X is pragmatic and scrappy and open for business. It clearly has a number of solid diversity best practices in place that are celebrated on the site. The company’s heart is in the right place. What is personal in this CEO’s statement, however, is not connected to today’s diversity business case. The DiversityInc Top 50 companies have moved on.

Recommendations

• Make the CEO statement easily searchable.
• Serve it up early and strong, no more than one click from the homepage.
• Have the faces of your company be diverse in more than the diversity and careers segments of the website.
• The CEO bio is another excellent place to beef up and honestly record the many ways your CEO is engaged and that diversity does matter in his or her personal life.
• Describe senior executives’ multicultural board commitments, how they have invested the company in community development where the company’s people work. Make their diversity personal.

The post We Evaluate CEO Commitment on Corporate Websites appeared first on DiversityInc.

A panel of experts in New York this week discussed the implications of “Fulfilling the Promise: How More Women on Corporate Boards Would Make America and American Companies More Competitive,” as well as recommendations for improving the talent development and promotion of women to senior management roles. Ernst & Young’s Beth Brooke, global vice chair of Public Policy, moderated the panel, and Chairman and CEO Jim Turley, who has been a visible advocate for cultural diversity, gave the opening keynote. Ernst & Young is No. 6 in the 2012 DiversityInc Top 50.

The other panelists were: Joanna Barsh, Director at McKinsey & Company; Nels Olsen, vice chairman and co-leader, board, and CEO for Korn/Ferry International; and Gail Becker, chair for Canada, Latin America and U.S. Western Region at Edelman.

Why Talent Development for Women? 

The report provides evidence that U.S. businesses need to make talent development for women a top business priority to retain global competitive advantage. This will be necessary to attract, retain and develop the best female talent, a group that is increasing in economic influence, according to its findings.

The biggest implications for developing female talent are global demographic and economic shifts. “Executives are 70 to 75 percent white men but, if you look forward, demographic shifts in gender and ethnicity show that employees and customers will not be,” explained Turley. “Boards need to be more actively engaged with who they represent.”

“Women can be quantified as an emerging market. They are the No. 3 economic power in the world today, behind only India and China,” added Brooke. “Women are an untapped engine for American competitiveness.”

• Women are highly talented: 36.8 percent of master’s degrees now are earned by women. In 2010, more women earned bachelor’s degrees  than men (20.1 million compared with 18.7 million, respectively), according to census data. Read Women’s History Month Facts for more.
• Businesses with more women directors perform better: A Catalyst study of 2004–2008 data shows that companies with the highest average of women directors (top quartile) outperformed companies lacking representation at senior levels (bottom quartile) by 26 percent in return on invested capital.
• America is falling behind: Currently, 15.6 percent of U.K. board members are women. The percentage of U.S. women on corporate boards ranges 12.1 to 12.3 percent, with Fortune 100 companies averaging about 11 percent women and Fortune 500 companies averaging 15 to 16 percent.
• European countries will continue to promote women: The United Kingdom announced in March a strict diversity goal to obtain a minimum of 25 percent women board members for FTSE companies by 2015; the European Union’s justice commissioner has noted that legislation on the issue could be passed since self-regulation has not brought enough progress. Quotas of 40 percent are being considered in Norway, Spain, France, Italy, Iceland and Belgium, cites the report.

Talent Development: The Solution?

Referencing The Atlantic’s provocative “Why Women Still Can’t Have It All” cover story, the panelists discussed how male-oriented corporate cultures can be a roadblock to developing women executives. The main challenge, cites the panel and the article, is in managing time between a high-performance career and equally important family responsibilities.

As for the solution to removing gaps in gender among corporate leadership, the panel says there are a few factors that need to come together:

• Accountable leadership with CEO commitment. The pipeline of female talent is there “but it really comes down to leadership. Everyone has to be on the same page and communicate that focus on diversity down through the recruiting process,” said Olsen. Watch this diversity web seminar on CEO commitment for best practices in communicating top management commitment to diversity and inclusion.
• Champions for change. “We need a series of CEOs to come forward and say they’ll become U.S. companies of change,” said Barsch. That focus and business case then needs to be communicated by the CEO and his management team to shareholders and investors to drive the change.
• Changing representation at the top. “Until you get more women onto boards and on management teams, the discussion doesn’t change enough,” added Turley. “Corporate culture needs to change so that merit is not about face time but what executives produce.” This will allow a more inclusive environment and give women the ability to take advantage of flexible work schedules, work-from-home options and other work/life benefits. Watch this work/life web seminar for best practices.
• Improve sponsorship initiatives: “Women traditionally are not as good at sponsorship. It’s something we need to make a cognizant effort of,” said Becker, noting that women tend to share credit with their team, which makes it more difficult to identify top performers. Companies should look to assign women sponsors as well as mentors. Watch this diversity web seminar on talent development for additional best practices in identifying female talent.
• Women helping women: All the panelists agreed that women also need to take more actionable roles in promoting their own careers and raising their sights. “About 36 percent of men said in a [McKinsey & Company] survey that they aspire to get to the top, compared with only 18 percent of women,” said Barsch. Women executives need to share their stories and how they manage work and life responsibilities to prove to others that it can be done, added Becker. This is in addition to continuous networking and publicizing to managers how high up the ladder you’re aspiring to go. Read how this strategy helped Beth Mooney become the first female CEO of a major bank.

For more on global diversity and the changing role of women in business, read our exclusive global research in 17 countries: Why Is Global Diversity So Difficult? Also, watch the video below of DiversityInc Senior Vice President and Executive Editor Barbara Frankel presenting the most recent findings.

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