A new data-rich report based on Russell 3000 company public disclosures: "Corporate Board Practices in the Russell 3000 and S&P 500" attributes the slow progress on increasing board diversity to a combination of long director tenures, few board vacancies, and relatively few openings filled with first-time directors.
Key findings include:
- 25% of newly elected directors never served on a public company board.
- Average director tenure among the S&P 500 is 11.3 years (down from 12.2 years in 2016), and 10.4 years among the Russell 3000 (flat with 2016).
- 10% of Russell 3000 directors and 6.3% of S&P 500 directors are aged 50 or younger. The median age is 64 for the S&P 500 and 63 for the Russell 3000.
- 22.5% of S&P 500 directors are female, compared to 16.4% of the Russell 3000. 20% of the Russell 3000 have no female directors. Just 4.1% of Russell 3000 boards and 4.3% of S&P 500 boards have female board chairs.
- More than half of the S&P 500 and nearly a third of the Russell 3000 have formal, written board candidate selection diversity policies.
- About 14% of Russell 3000 companies and nearly 30% of the S&P 500 disclosed that they conducted annual individual director evaluations.
The collaborative study of 2018 disclosures - which covers board structure and composition; director elections, removal and refreshment; and other board policies (including mandatory retirement, overboarding, director orientation & education, and board diversity) - was undertaken by The Conference Board in collaboration with ESG data-mining firm ESGAUGE, and with the support of the John L. Weinberg Center for Corporate Governance, Debevoise & Plimpton, and Russell Reynolds Associates.
See also the release; this Cooley post; this WSJ article; our prior report: "Fortune 100: New Director Class Reflects Continued Expanding Candidate Pool"; and numerous additional benchmarking resources on our Board Practices/Governance Practices page. This post first appeared in the weekly Society Alert!