Investors Not Only Ones Bothered by All-Male Boards, Survey Says

Stay current on changes and developments in corporate law with a wide variety of resources and tools.

By Andrea Vittorio

The need for more women on public company boards is one issue where investors can agree with companies and others in corporate governance, according to the results of a survey by proxy adviser Institutional Shareholder Services Inc.

Survey results released Sept. 25 show that more than two-thirds of investors think it’s “problematic” for corporate boards to have no women on them. So do a majority of respondents from companies, boards, and elsewhere.

“It’s pretty hard in 2017 for anyone to say it [gender diversity] doesn’t matter or companies shouldn’t care about it or do anything about it,” Marc Goldstein, head of U.S. research at ISS, told Bloomberg BNA. Still, he said there’s “some room for disagreement” on how shareholders should respond to a lack of female directors.

BlackRock Inc. and State Street Corp. and other investors are more often responding with their votes. Shareholder support for proposals on board diversity grew at companies’ annual meetings this year, a recent report from Broadridge Financial Solutions and consultant PwC found.

Some institutional investors have also voted against directors on all-male boards. Non-investors who responded to the ISS survey would rather see shareholders do that than nominate their own candidate to the board.

Issue to Follow

ISS, which gives recommendations on how investors who are clients should vote, uses surveys to help weigh possible updates to its policies. Goldstein doesn’t expect a new policy on gender diversity for next year, but he said “this is an issue that we’re going to continue to follow.”

Both investors and non-investors told ISS they’d be less concerned if companies disclosed what they’re doing to boost gender diversity in the boardroom. About 25 percent of companies in the Russell 3000 index had no women on their board in 2016, down from about 30 percent in 2014, according to data from Equilar Inc.

Responses were more split on other topics, such as increasingly popular yet controversial share structures that let founders like Facebook Inc.’s Mark Zuckerberg keep control of their company. Facebook recently dropped a plan that would have cemented Zuckerberg’s control just days before a shareholder challenge was set to go to trial. Half of non-investors surveyed by ISS said companies should be able to choose whatever share structure they see fit. Only 5 percent of investors surveyed said the same.

Views also diverged on company meetings going from in-person to virtual. Twice as many non-investor as investor respondents said they were generally all right with the growing trend.

To contact the reporter on this story: Andrea Vittorio in Washington at

To contact the editor responsible for this story: Yin Wilczek at

Copyright © 2017 The Bureau of National Affairs, Inc. All Rights Reserved.

Request Corporate on Bloomberg Law