The Equilar Institute provides in-depth data research and analysis on boards of directors, shareholder engagement, executive compensation and other issues affecting the world of corporate governance. Below are some top picks from the last quarter that can be found exclusively on www.equilar.com.
Due to accelerating growth in the percentage of women on boards at Russell 3000 companies, gender parity is now expected to be achieved by 2048, according to the latest Equilar Gender Diversity Index (GDI).
Thirty years may seem like a long way away—and it is. However, this projected timeline has shortened considerably in one year. The inaugural Equilar GDI, published in February 2017, found that women occupied 15.1% of Russell 3000 boards as of 2016 proxy statements, and at the rate of growth to that date, gender parity would not have been achieved until 2055.
“Even if it’s still 30 years away by this projection, I’m optimistic that the speed of change will accelerate significantly over the next decade due to a number of forces,” said Susan Angele, Senior Advisor with KPMG’s Board Leadership Center.
“The number of available board seats will increase as some directors may be asked to leave or opt out of their boards as board workloads continue to rise, good governance increasingly demands robust individual director evaluations, and board skill sets link more closely to company strategy,” Angele added. “In addition, baby boomer directors will begin to reach retirement age in large numbers, and board members who retire will likely be replaced by directors who are more diverse in terms of experience and skill set as well as gender.”
The progress made toward gender parity is a meaningful step on the path to more diverse representation in corporate boardrooms more generally, but there is still a long way to go. As of December 31, 2017, the Equilar GDI was at 0.33, meaning that just 16.5% of board seats at Russell 3000 companies belonged to women. That figure increased from 16.2% a quarter earlier. (Graph 1)
“There is a lot in these numbers to be optimistic about—a date that achieves parity seven years sooner, fewer boards with zero women and more boards at gender parity,” said Blair Jones, Managing Partner, Semler Brossy Consulting Group. “Of course, there is more to be done to improve these values further, but the concerted effort of investors and companies is clearly making a difference.”
“Over the past few years, many large investors have updated their voting policies around board diversity. In addition, many of these institutions have asked issuers to provide further disclosure related to board member qualification metrics, board refreshment process and director recruitment practices,” added Brigid Cremin Rosati, Director of Business Development at Georgeson. “These combined efforts have set a high threshold for companies to meet, and in my view, these efforts and media scrutiny will ultimately continue to accelerate gender parity on boards.”
Check out www.equilar.com to see more highlights from this study, and to download an executive summary of the data as well as a list of the 32 boards that have already reached gender parity.
Top sales leaders at public companies are becoming more prominent in senior executive ranks, and their pay is increasing in parallel. Equilar analyzed how sales leadership roles have evolved as one of the top named executive officers (NEOs) at U.S. public companies in the recent past.
There were 218 top sales executives disclosed in annual proxy statements as one of the top five highest-paid employees at their respective companies in fiscal year 2016, and median compensation for these leaders was approximately $1.3 million. The Equilar blog published a list of the 50 highest-paid executives in a sales-specific role (often the Chief Revenue Officer) that were disclosed in public filings for 2016. (Graph 2)
The buck stops with the C-suite and the board of directors at every public company, and therefore, gaining knowledge that will help focus efforts to influence leadership at the highest levels is critical. After all, a cold call to a CEO or board member on any matter is likely to be fruitless. Only 1% of cold calls result in meetings as it is, and it stands to reason that the rate would be even lower at the highest levels of an organization.
Recognizing the right time to deploy teams for targeted outreach is one of the most consistent challenges for sales and marketing executives in particular. They are constantly on the lookout for signals that their teams can use to engage leading decision makers in the C-suite and the boardroom.
The good news is that information that can help you connect with C-suite executives and the board of directors is right at your fingertips. An Equilar blog outlined various ways to apply data and automated signals to help professionals build their executive networks.
Younger board members are thought of as providing new perspectives. To examine how director skills compare across age groups and identify whether this is true, a new study from Equilar looked at various age groups to see what skills each group has to offer. The study was limited to 383 companies that disclosed board matrices in their annual proxy statements, inclusive of 3,570 board members.
Among the directors with disclosed board skills, 52% of them are over 60. These directors will eventually be replaced, and as the data suggests, certain skills will continue to be relevant, while others may become more prevalent with the introduction of younger directors to the board. As board matrices become more of a mainstay in company proxies, they will provide a clearer picture of how the new generation of board members looks in terms of the allocation of skills.