50/50 Women on Boards, the leading education and advocacy campaign accelerating gender balance and diversity on corporate boards, has released new research revealing a positive shift in board diversity. For companies that represented the 25 largest initial public offerings (IPOs) of 2020, women held 24% of all company board seats – up from 21.9% in 2019, culminating a 10% overall increase since 2015. However, six companies among the largest IPOs of the year still went public with only one woman on the board, and one company went public with no women. Further, women of color still hold the fewest board seats, just under 5%, across the Fortune 500 largest publicly-traded companies.
“The progress made in board gender diversity among the top 25 IPOs is promising, but more needs to be accomplished in pursuit of diverse leadership,” said Betsy Berkhemer-Credaire, CEO of 50/50 Women on Boards. “Having women on boards is good for business, from better profitability and productivity, to improvements in workplace culture. It’s unfair that publicly traded companies would deprive their shareholders of this business advantage. Respected shareholder voices like ISS and StateStreet will vote against directors of companies without diverse board members. There’s been considerable improvement for women on boards, but now we must focus on gender balance and diversity on boards.”
While 2020 presented pivotal challenges for women in the workplace, women’s advancement onto boards at the time of IPO continues to increase. From mortgages to food wrap, two well-known companies went public last year with gender-balanced boards: Rocket Company Inc. and Reynolds Consumer. Additionally, 10 companies on the top 25 IPO list of 2020 had three or more women directors. Of the top 25 companies that went public in 2019, by the end of 2020, they added 12 women for a percentage of 25.6% women on these companies’ boards. Notably, Lyft and Uber, which went public in 2019, achieved gender-balance on their boards in 2020.
The 2020 findings offer optimism for gender diversity on public boards, but there are still far too many companies entering public ownership lacking gender balance and diversity. The 181-year-old Dun & Bradstreet did so with the dubious distinction of being the only company on the list to go public without a single woman on its board.
“We are pleased to see that there are more women on boards than ever before, but we must remain focused on the goal,” says Malli Gero, Co-Founder and Vice-Chair of 50/50 Women on Boards as well as the author of the 2020 IPO gender analysis. “We are not aiming for only a handful of companies to achieve greater gender diversity; we must work to establish gender balance and diversity as the norm on corporate boards. 50/50 Women on Boards remains focused on being a leading voice in this effort.”
Social and financial pressures are moving companies toward having more women on boards. In December 2020, Nasdaq filed a proposal with the Securities and Exchange Commission (SEC) to adopt new listing rules regarding boardroom diversity and disclosure. If approved, within four years, all companies listed on Nasdaq’s U.S. exchange will be required to have at least two diverse directors – one who self-identifies as female and one who self-identifies as either an underrepresented minority or LGBTQ+.