Nearly 50% of New Russell 3000 Directors Were Women in Q3 2021

The number of women in director positions at the largest U.S. companies continues to increase, according to the most recent edition of the Equilar Gender Diversity Index (GDI). As of Q3 2021, 26.1% of Russell 3000 directorships were held by women, up from 25.2% in Q2 2021. As a result, the needle on the GDI inched forward from 0.50 to 0.52 in the past quarter, where 1.0 represents gender parity on boards of directors.

Among the leading factors driving this acceleration is the fact that almost half (47.7%) of new board seats were filled by women in Q3 2021. During Q3 2020, that figure was much lower at 40.9%. Additionally, in Q3 2021, there were 92 Russell 3000 boards with at least 50% women, up from 84 in Q2 and from 73 one year earlier. Meanwhile, boards with female representation between 40% and 50% jumped from 208 to 232 in Q3 2021.

“The progress continues to be encouraging, but moving from a homogenous board to a diverse board requires intentionality,” said Susan Angele, Senior Advisor of Board Governance at KPMG’s Board Leadership Center. “Whether driven by the nom/gov chair, lead director or another board member, a leader with a strong commitment is often the key to board diversity.”

Legislative efforts, such as those in California, Illinois and Washington, have added pressure on boards to accelerate the pace of electing women directors. More recently, Nasdaq’s SEC-approved board diversity listing rules have altered the way companies approach the topic of board diversity. The requirements ultimately do not require boards to meet the diversity minimums to remain listed, but they do require companies that fail to reach stated minimums to explain why they do not comply.

“The Nasdaq proposal has fundamentally shifted the conversation around board diversity,” said Brigid Rosati, Managing Director, Business Development and Corporate Strategy at Georgeson. “This non-compliance disclosure will undoubtedly open the floodgates to further scrutiny around broader workforce diversity, which was a key issue in the 2021 proxy season.”

Read the full Q3 2021 Gender Diversity Index for more findings and commentary.

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