One Dino, Two Dino… 24 Fortune 500 Dinosaurs Left
As I have recently discussed, according to data from S&P Global Market Intelligence, 24 Fortune 500 companies currently have no women on their boards. Fortunately, that is less than 5 percent of Fortune 500 companies. The good news is that the majority of Fortune 500 companies include at least one woman. The 24 remaining companies seem to be of a dying breed, on their way to extinction. Due to their growing obsolescence, I like to call these 24 companies "Dinosaurs."
The good news…
According to the 2020 Women On Boards Gender Diversity Index, in 2015 "20.1 percent of board seats [in Fortune 500 countries] were held by 1,012 women — an average of 2.2 women directors per board." Moreover, the Fortune 501-1000 are adding women directors, albeit at a lower rate. In 2015, the 2020 Women On Boards Gender Diversity Index also reported that "of the Index companies in this cohort, 648 women hold 17.0 percent of board seats — an average of 1.7 women directors per board." Conventional wisdom suggests that at least three women on a board creates adequate representation. Although the average company hasn't reached this standard yet, there is a clear movement toward more equal gender representation. Eventually, failing to appoint at least one woman to a board of directors will be unheard of. The increasingly lonely Fortune 500 companies that do not have a single woman on their boards are depicted in this chart.
But, still too many dinosaur companies
Given the obvious minority status of this group, it is clear that their outdated practices are against the growing trend of gender inclusion. They are simply on the wrong side of history. It is a question of time before these "Dinosaurs" abandon their outdated practices and retire to "Dino Heaven," where they can enjoy their retirement. In Dino Heaven they'll be awarded halos and clouds as part of their retirement from obsolescence. The halos and cloud badges are depicted in this chart. With the promise of graduating to Dino Heaven, why would any of these last hold-out companies choose to cling to their outdated, diversity-lacking, hiring practices?
Throwing down the gender diversity gauntlet
I challenge each of these Dinosaur companies to race to retirement, abandon their obsolete practices, earn their halos and clouds, and become the heroes of Dino Heaven. After clinging to gender inequality for so long, adding at least one woman to each company's board of directors is a huge step in the right direction. What can be more exciting than doing the right thing to achieve Dino Heaven retirement?!
Besides the coveted halos and clouds, the perks of early Dino Heaven retirement, and the honor of retiring sooner than the rest of their Dinosaur peers, why else should these 24 companies add women to their boards of directors? There are two main reasons:
- Women on Boards Are Better for Business: Adding at least one woman makes business sense for each company on this list. Numerous studies indicate that adding a qualified woman to a board of directors will significantly increase profits, boost the company's competitive advantage, and put the company on the right side of the issue. See this 2015 study by McKinsey and Co. (finding that companies in the top quartile of gender diversity are 15 percent more likely to financial outperform those in the bottom quartile), as well as this 2014 Catalyst study (finding that having more women in leadership and board positions resulted in better financial performance while increasing innovation and group performance).
- Women on Boards Are Better for Society: Adding women to boards is the right thing to do socially. On average, at least three women on a board can create adequate representation. Having not even one woman on a board is extreme under-representation. Companies that aim to improve and shape society can't do so unless they reflect society. Upcoming generations deserve a future where gender inequality is a thing of the past, not a status quo to accept or even a hurdle to overcome. Unless these companies want to be on the wrong side of history, they should take steps toward gender equality on their boards.
Dinosaur Companies are the Tip of the Iceberg
Although these 24 companies make up less than five percent of the Fortune 500, we must not forget that women are still grossly underrepresented in board service overall. It merely captures the gross violators of inclusion. As of 2015, women make up about 20 percent of all board members in Fortune 500 companies (and less than 20 percent of all board members in smaller companies). In other words, these 24 Dinosaur companies are merely a tip of the iceberg. This makes adding women to their boards even more vital — how can the business world take steps toward gender equality overall, when some companies haven't even tied their shoelaces?
In the meantime, as we are waiting for the Dinosaurs to join Dino Heaven, please sign my first two petitions — directed at Land O'Lakes and Discovery Communications — demanding that each of these Fortune 500 companies recruit a qualified woman to their board of directors.
A version of this article was published by the Association of Corporate Counsel (ACC) Docket.