Although women and minorities have been seeking seats on corporate boards for many years, progress toward diversity in the boardroom continues to be glacial. More than half of public companies do not have a single minority director, while almost one out of three companies lacks a female director, according to the National Association of Corporate Directors (see chart below).
Now, diversity advocates are looking to the Securities and Exchange Commission’s new proxy disclosure rule to prompt greater interest in women and minority director candidates. The rule, which went into effect in March, requires that all boards disclose whether or not they consider diversity when selecting candidates. If they do, they must explain their approach.
This month, Agenda, a Financial Times publication focused on board-related issues, published a directory that aims to speed the pace of change by providing options for boards looking to diversify their ranks. Called The Diversity 100, the directory lists 100 carefully vetted board candidates from business and academe. It includes such women as Pamela Craig, CFO of Accenture, and minority candidates like Robert Sanchez, former finance chief and current president of global fleet management at Ryder Systems.
Agenda gathered a panel of corporate-governance experts, executive recruiters, and representatives from diversity advocacy groups to nominate 271 possible candidates for inclusion in the guide. The group then winnowed the list down to 100 using numerous selection criteria. For example, candidates could not currently serve on more than two boards, had to be qualified to immediately serve on a Fortune 1,000 board, and had to be considered “up-and-coming” rather than a “usual suspect.”
Sixty percent of the resulting Diversity 100 has never served on a corporate board. “The whole idea of the project was to identify people who could bring a fresh perspective,” says Linda Basch, president of the National Council for Research on Women and a member of the selection panel. “The traditional candidates for boards are not going to lead to the kind of diversity of thinking at the top that we need to have. We want people who will challenge assumptions, bring new scrutiny, and raise new questions.”
Basch notes that sitting CEOs, the vast majority of whom are white and male, have long been the preferred candidates for board positions. The directory aims to expand the pool, she says: “We wanted to show that there are a lot of unrecognized people out there who have fantastic skills they could bring to boards.”