This article was originally published in Businesswire. Whatever works . . .
A coalition of global investors, managing over US $73 billion in assets, called on companies across the world today to increase representation of qualified women on boards of directors and in senior management. The call from Pax World, Calvert and Walden Asset Management, comes in response to a survey of 4,200 global companies that found only 9.4 percent of directors on corporate boards were women.
These findings have led a number of mainstream investors to identify gender balance and diversity as a strategic issue in their investment activity. The investors in this new coalition have asked 54 selected companies from across the business spectrum for greater clarity about gender balance within their organizations.
“We view gender equality and women’s empowerment as strategic business and investment issues,” said Joe Keefe, President and CEO of Pax World. “When women are at the table, the discussion is richer, the decision-making process is better, management is more innovative and collaborative and the organization is stronger. Because companies that advance and empower women are, in our view, better long-term investments, we are encouraging companies in our portfolios to enhance their performance on gender issues.”
The investor initiative is a response to the Women’s Empowerment Principles1 recently developed by the United Nations Development Fund for Women (UNIFEM) and the United Nations Global Compact. The Women’s Empowerment Principles are designed to help companies take specific steps to advance and empower women in the workplace, marketplace and community.
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“For Calvert, gender equality is an important aspiration for our own business as well as the companies in which we invest,” said Barbara J. Krumsiek, President & CEO, Calvert Group, Ltd. “In order for companies to reach their full potential, they must create an environment in which women are treated equally, where they hold key leadership positions, and are full participants in decision making. For this reason we created the Calvert Women’s Principles, on which the Women’s Empowerment Principles are based, and welcome this opportunity to work with other institutional investors to advance gender equality.”
The members of the coalition are all also signatories to the UN-backed Principles for Responsible Investment (PRI). “This engagement shows that gender balance within senior corporate management is not just a social issue but also a shareholder issue,” said James Gifford, Executive Director of the PRI Initiative. “In an increasingly complex global marketplace, companies that effectively attract, hire, retain, and promote women are often better equipped to capitalize on competitive opportunities than those who do not.”
The PRI coalition also reports increasing recognition of the value of board diversity by regulatory bodies worldwide. Three European countries have passed legislation requiring that either 30 percent or 40 percent of board members be women (the Netherlands, Norway and Spain), with four other countries considering similar legislation (Belgium, France, Germany and Sweden). In the United States the Securities and Exchange Commission adopted new rules for proxy disclosure, beginning this year, that include a requirement for companies to disclose how their nominating committees consider diversity in identifying board nominees. With its establishment of the Office of Minority and Women Inclusion, the recently passed Wall Street Reform also acknowledges the benefits of diversity in management, employment and business activities.
“Simply put, in the U.S. and globally, we believe that equitable and inclusive work environments are good for society, good for the economy and good for business,” stated Heidi Soumerai, Senior Vice President and Director of ESG Research at Walden Asset Management in Boston.