Research by the National Association of Corporate Directors (NACD) shows women are making gains in the boardroom and leadership positions, and that incoming board directors are increasingly bringing technology-related skills and knowledge to their new roles.
NACD’s 2022 Inside the Public Company Boardroom report, which offers data-backed insights into the boards of Russell 3000 Index companies, shows the percentage of board seats held by women has slowly but consistently increased over time. Women accounted for 41% of new director appointments and only 17% of those departing in 2022. With increased emphasis on gender balance on boards, this trend is expected to accelerate in the future, the report said.
Russell 3000 Index companies are the top 3,000 publicly traded corporations as ranked by market capitalization. As such, the Russell 3000 covers a more substantial portion of the total stock market than other indexes, approximately 96%.
“By producing this annual report, we provide valuable insight into the critical shifts and trends impacting boards today and what we can expect to see in 2023,” said Peter Gleason, president and CEO of NACD.
Other findings in the report include:
- Board independence changed little in 2022, though it has increased gradually over time. In 2020, only 15% of boards in the Russell 3000 had compositions where 90% of board members were independent directors. This increased to 17% in 2021 and 18% in 2022.
- A higher percentage of newly appointed directors have technology skills, according to director-disclosed biographies. Among those finishing their terms, however, were more directors with financial and strategic vision skills.
- Year over year, there was little change in the tenure of those in board leadership positions: board chair; lead director; and audit, compensation, and corporate governance committee chairs. However, over three years, the tenure of those serving in the board chair role has slowly decreased.
- Board use of nonstandard committees such as risk, technology, and sustainability has increased over the last two years.
The NACD is a membership organization representing more than 23,000 corporate board directors in the United States. The NACD report, published on Jan. 25, was based on data gathered by NACD partners Pearl Meyer, Main Data Group, and MyLogIQ.