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Despite a Direct Correlation to Better Company Performance, Women are Still Failing to Make Strides in the Boardroom

Women are still having one heck of a tough time making strides in the boardroom, a new study confirms. This is despite the fact that Fortune 500 companies with more women board directors (WBDs) tend to outperform their competitors in such areas as return on sales, return on invested capital and return on equity.

The latest report from Catalyst—a non-profit organization focused on expanding opportunities for women and business—finds that women are no further along the corporate ladder than they were six years ago. According to the report, focusing on Fortune 500 companies’ women board directors:

  • Women held 14.1 percent of CEO positions in 2011, which is slightly lower than the 14.4 percent in 2010.
  • Both this year and last, less than one-fifth of companies studied have 25 percent or more women board directors.
  • About one in 10 companies have no women serving on their boards at all.
  • In both 2010 and 2011, women of color still held only 3 percent of corporate board seats.
  • Women held only 7.5 percent of executive officer top-earner positions in 2011, while men accounted for 92.5 percent of top earners.

Another recent report from Catalyst indicated that sustained gender diversity in the boardroom correlates with better corporate performance—“and not by just a little,” Catalyst states.

Here, Catalyst found that Fortune 500 Companies that have had three or more women board directors in at least four of five years studied, significantly outperformed those with sustained low representation:

  1. By 84 percent in terms of return on sales,
  2. By 60 percent in terms of return on invested capital, and
  3. By 46 percent in terms of return on equity.

The performance-focused study looked at corporate performance and women’s representation on boards between 2004 and 2008.

“In light of yet another Catalyst study demonstrating the powerful correlation between increased women’s leadership and better business performance, continued obstacles to progress make no sense,” Ilene H. Lang, Catalyst president and CEO, said in a statement.

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AUTHORJanet Aschkenasy Insider Comment

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