By Lorrena Black and Terry Barclay
Black women are being left out of U.S. corporate governance, and America’s companies are missing out as a result.
In 2021, Black women held only 21 of the 742 board seats at Michigan’s 82 public companies.
Fourteen of those directors were on the boards of the 32 largest companies comprising 322 board seats. That means only seven Black women sit on the remaining 50 Michigan public companies.
Corporate proxy statements, annual statements to shareholders that list board candidates, filed so far this year show those numbers will change very little.
Part of the reason is that board opportunities are scarce. The 27 largest companies that have filed proxies to date show only 14 new board candidates, with the remainder being put forward for re-election. One is a Black woman.
And diversity may be starting to lose ground as a corporate priority.
The search firm Spencer Stuart’s 2021 survey of S&P 500 nominating/governance chairs showed that gender diversity as a priority in board recruiting profiles fell from 3rd to 10th place. Emerging priorities are expanding and enhancing environmental, social, and governance (ESG) investing, which was the No. 1 priority.
The 2022 edition of What Directors Think, Corporate Board Member’s annual survey of U.S. public company board members, reports that nearly half (47%) believe they have met their diversity goals with another 32% who say they’re on track to meet them on the timeline that has been set.
Boards are tasked with meeting a significant number of objectives. But given the relatively small number size of most boards, it is desirable if individual directors make boards stronger in more than one way.
Diversity enables that. The 2021 edition of the Missing Pieces report, published by the Alliance for Board Diversity in collaboration with Deloitte, reported that women and minority board members are currently more likely than white men to bring experience in corporate sustainability and socially responsible investing, government, sales and marketing, and technology to their boards.
The bottom line is that less attention to diversity is likely to affect Black women more than other diverse groups – including Black men and white women – because they are already more underrepresented. And yet, sustained attention to board diversity brings more access to expertise.
So what should corporations do?
- Change directors more often. Companies need some longevity from directors, but some companies retain board members for decades. Investors, properly, are starting to push back on this.
- Avoid a “check the box” mentality. Make sure every board vacancy has gender-diverse and racially diverse candidates, including Black women.
- Ensure director candidate research unearths candidates not already known to one or more directors or the CEO. As retired BET CEO Debra Lee, who sits on numerous corporate boards, says: “Stop fishing in the same pond.”
We know that Black women are an important part of the corporate talent pool. We are committed to helping companies move from a conversation about why to a call to action about how.
Terry Barclay is president and CEO, and Lorrena Black is vice president of leadership development for Inforum, a 60-year-old nonprofit helping to increase opportunities for women in their careers.
On May 11, 2022 Inforum will host a breakfast – in person and virtually – focusing on the status of Black women on corporate boards. Featured speakers: Christie Coplen, Spencer Stuart; Wendye Mingo, Kresge Foundation; Christine Moore, Comerica; and Karen Carter, Dow (moderator). More information here: https://inforummichigan.app.neoncrm.com/np/clients/inforummichigan/event.jsp?event=39152&