By Lesley Green-Rennis
- 12% of new corporate board directors were Black women since 2021
- 72% of incoming S&P 500 companies board of directors come from historically underrepresented groups
Efforts to diversify boardrooms have accelerated and starting in 2021, more Black women joined S&P 500 boards at companies like Abbot Laboratories (ABT +0.90%), Delta Air Lines (DAL +0.43%), and Lowe’s (LOW -0.64%) than any period in the past 15 years. As companies increasingly seek board members who reflect their workforce, customer base, and shareholders, Black women fit the bill as 12% of new corporate board director seats have been filled by them since 2021.
Why This Matters: In some cases, companies are mandated by state legislators, regulators, and investors to diversify their boards. The Securities and Exchange Commission approved a Nasdaq listing requirement that companies in coming years must explain publicly if they do not have at least one woman on their board. This also includes directors who are a racial minority, or one who self-identifies as lesbian, gay, bisexual, transgender or queer.
Though such requirements have faced legal challenges, corporate governance professionals say the regulatory efforts and investor interest have led most large companies and many smaller ones, to meet the requirements. Research shows companies with higher levels of diversity at the board level are more likely to have strong financial performance and fewer instances of poor corporate governance.
Situational Awareness: Large institutional investors-including BlackRock, State Street, and Fidelity Investments are considering boardroom diversity when deciding how much to invest in companies. While the fate of certain regulatory and legislative mandates remains uncertain, companies are increasingly welcoming Black women as board members, and that’s a great thing.
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