Pennsylvania legislature uses carrot to "encourage" gender equity
The latest salvo to get corporations to boost gender diversity on boards came from the Pennsylvania legislature with the unanimous, nonpartisan passing of a resolution last week.
The legislation is not about affirmative action, says lead sponsor of the resolution Rep. Kate Harper (R), adding that, “The goal is to shed a little light on the subject."
It’s a subject that’s gotten a lot of attention in recent years, with little movement when it comes to major diversity inroads in the nation’s boards. Other states have passed similar resolutions, and a national effort has also been in the works. The Gender Diversity in Corporate Leadership Act was reintroduced earlier this year by Congresswoman Carolyn B. Maloney (D-NY)
The Act calls for the creation of a diversity advisory group at the Securities and Exchange Commission that would study and then issue a boardroom gender diversity report. In addition, it would require companies to report the gender makeup of their boards.
“If we do nothing, we won’t reach gender parity on corporate boards for at least another 40 years,” said Maloney in a statement.
Indeed, gender parity on boards would be achieved by 2048, according to research from the EY Center for Board Matters. Women only make up 18% of the board seats among the S&P 1500, and the proportion of women-held directorships grew a measly 1% in 2016, and about the same in the proceeding three years.
The new Pennsylvania resolution will remind companies that getting more women on boards is a boon for board dynamics and for the bottom line, maintains Harper.
The summary states that it is "A Resolution encouraging equitable and diverse gender representation on the boards and in senior management of companies in Pennsylvania."
While many companies look for C-suite experience, something that’s keeps many women from being considered, she's hoping when organizations recruit new board members, they will also give weight to industry experience that research has proved very useful for board members.
The movement to get more women on boards is gathering momentum, says Suzanne Mayes, president of the Forum for Executive women.
The resolution, which the Forum helped write based on similar legislation in California, Colorado, Illinois and Massachusetts, brings the issue to the forefront, she explains.
“A large piece of the puzzle in solving this problem rests on education,” she notes, adding that there's a very strong business case to be made for having women on boards. “When we raise the issue in chambers of state legislatures, have press coverage, educate legislators and lead the business community on this point, it’s increasing a sense of urgency around this issue.”