Gender diversity momentum stalls across U.S. corporate boards on Russell 3000

The forward momentum of gender diversity on U.S. corporate boards appears to be slowing in 2024, according to a new report from 50/50 Women on Boards.

Based on an analysis of the Russell 3000 Index, women held 29.7% of board seats during the first quarter, increasing 0.3% from the previous quarter and 0.8% from the previous year. Among 587 new board positions, 30.7% were filled by women, marking the lowest percentage since 2017.

Although some sectors and regions saw improvements, fewer than half of companies still have boards with two or fewer women, and the vast majority of seats newly filled by women were added to the board. Women of color hold about 8% of board seats, which was a slight increase.

“At this rate, achieving gender parity on boards and 20% women of color representation will not happen until 2045,” according to the findings. “The report calls for renewed commitment to dismantle barriers to equitable representation in corporate governance.”

During the first quarter, the number of gender-balanced boards rose by one company, and boards with three or more women increased by 21 companies. In contrast, the number of boards with zero women decreased by seven, and those with one or two women dropped by 45 companies. 

“These shifts underscore a significant trend: Companies with less diverse boards exhibit a higher likelihood of exiting the Russell 3000 list due to factors such as sales, mergers, or bankruptcy,” according to the report.

By sector, utilities topped the list with 34.1% women on boards, followed by consumer defensive and consumer cyclical. At the bottom of the list, financial services had about 27% of women on boards.

Notably, when women lead — as CEO, board chair or nominating/governance chair — boards are more likely to shift toward gender parity, with both the percentages of women and women of color on boards exceeding national averages. When women aren’t in one of the three leadership positions, however, both metrics fall below national averages. 

“These insights highlight the pivotal role of female leadership in driving diversity within corporate boards,” according to the report.

Despite ongoing progress in recent years, no Fortune 500 company board fully represents the demographic population of the U.S., according to a June 2023 report by Deloitte and the Alliance for Board Diversity. About 45% of women and people from underrepresented racial and ethnic groups held Fortune 500 board seats in 2022, increasing from 38% in 2020. Even so, at that pace, top corporate boards may not become fully representative of the U.S. until 2060, Deloitte said.

Although women leaders support a more inclusive culture and workplace, they’re less likely to receive career development opportunities, including mentorship, leadership training or key executive responsibilities, according to a DDI report. When women don’t receive this support, they’re 1.5 times more likely than men to leave their companies to advance in their careers.

Perception may play a role. Men and women express different views about gender-related gaps in pay and promotions, including perceptions around equal pay and benefits, leadership parity and the timing and frequency of promotions, according to a HiBob survey. These perception gaps could indicate a lack of transparency or a disconnect in cultural communications within companies, the report found.