Tick Tock: Can Corporate Boards Beat The Clock For Parity?
As Silicon Valley citizens, we’re all about progress. And we know that progress, like all good things, takes time. But recently, we did the math. In 40 years, we will be in our seventies. In 100 years, we will, hypothetically, be in our mid-hundreds. The facts are cold. And math is stubborn. We’ve realized that even with modern medicine and technology, time may be against us.
We may not live to see gender parity on U.S. corporate boards. Something we, as lawyers, must care about since diversity at the very top level of a company trickles down to the entire company and all its department, including legal.
Right now, there are still 19 Fortune 500 companies with all-male boards. Only 20.2% of Fortune 500 board seats are held by women, even though more than half of management occupations are held by women. According to the U.S. Government Accountability Office (GAO) and the Equilar Gender Diversity Index (GDI), it will take 40 to 100 years to reach parity on American corporate boards. At this rate, there’s no way we’ll see it happen within our career years – and there’s only a very slim chance that we’ll see it within our lifetime. The next generation is no better off. Even with the most generous estimates, our young daughters would be well into their careers by the time parity is achieved.
Granted, we know there is a historic worldwide trend is toward gender equality. We will get there, eventually. It may take a very long time, but in the grand scheme of this 13 billion-year-old universe, 100 years is a drop in the bucket.
Yet, we are very attached to this drop. It is our drop in this huge bucket of life. Why should our drop, our 100 years, be wasted? Why are the chances of seeing parity so slim, even for our daughters? Why aren’t companies solving this parity problem now?
Much of the work is already done for them. We know the causes of this inequality. GAO and numerous other studies conclude that the lack of board term limits, narrow-minded recruiting practices, and tendency to recruit within the “old boys’ network” account for the historic lack of parity on corporate boards. Now it’s on the companies to institute term limits, conduct broader searches, and define board service qualifications inclusively. The ball is in their courts.
All excuses for inaction have been debunked. Some say that there are not enough qualified women. Yet we can name 100 women who are qualified for board service, just from our personal network. Of course, not all women are qualified for board service – as with men, some women are more qualified than others. But it’s no reason to categorically exclude women!
In fact, there are numerous studies that suggest that women, and board diversity in general, may increase shareholders’ long term returns. That’s precisely what boards are charged with doing. There are certainly no studies that show how diverse boards will damage companies. That’s, good or bad decisions are an equal opportunity for both genders. With no chance of endangering shareholders’ long term returns, there’s simply no excuse for not taking action toward parity on boards. Clinging to tradition is outdated and spineless.
Ultimately, we need to stop resigning ourselves to waiting another 40 to 100 years for parity on boards. Companies should actively recruit women to serve on their boards of directors and individuals should suggest qualified women, vote with their wallets, and demand change. This isn’t an astronomical event that requires the stars to align perfectly in order to happen. It is real progress that will benefit both companies and society as a whole. As long as we act now and together, we can get there sooner, much, much sooner. In fact, doing so would be a perfect way to celebrate International Women’s Day.
This article was originally published by Above the Law.