POC Make Up 20% Of Corporate Boards – But Is It Enough?
As companies push to get more diversity from top to bottom, corporate boards see more diversity, with racial and ethnic minorities holding 20% of all board seats.
In an ISS Corporate Solutions Inc. study, Black directors now hold 8.3% of all board seats, a significant jump from just 4.4% four years ago. In addition, the number of board seats held by white directors fell by 9%, with white people now occupying 79.9% of all company directorships.
“Though their proportional numbers remain behind those of the U.S. population as a whole, these figures nevertheless represent a watershed moment for minority corporate directors broadly and Black directors in particular,” said Marjia Kramer, head of ICS, in an interview.
It is hard to deny the many benefits of having boardroom diversity. Not only does it bring a diverse range of perspectives to the table, but it also helps companies mitigate risk and build solid brand reputations.
Last year, the Securities and Exchange Commission approved a Nasdaq Listing requirement, compelling companies to meet specific targets for gender and ethnic diversity on their boards. If these targets are not met, many would be obliged to explain in writing why they haven’t.
As the pressure around diversifying boardrooms continues to increase, more Black and brown people will start to take up space in these rooms but will it eventually become another tick-boxing exercise for organizations?