Last month, Calvert Investments and Connecticut’s Treasurer tried to get Urban Outfitters to agree to consider bringing women and minorities onto its seven-member, all-white male board.
“What we asked was that every time they consider a slate of directors, they also consider a woman and or a minority as part of that slate,” said Aditi Mohapatra, a senior analyst with Calvert, an investment management company that focuses on socially-conscious investing. The shareholder proposal didn’t require that more diverse candidates be appointed, she noted, just that they agree to make a concerted effort to at least think about diversity.
Urban Outfitters didn’t budge.
“They said, ‘We don’t have any diversity problem,'” Mohapatra said.
The proposal was voted down on May 17 during the company’s shareholder meeting. (Urban Outfitters did not respond to msnbc.com’s request for comment.)
It’s not the first time Mohapatra has tried to convince a company to make such changes. Since 2002, Calvert has filed 55 similar shareholder measures with a variety of corporations. Her mission is to boost diversity at the top echelons of business, and in most cases the companies agreed to consider her proposal. Unfortunately, the top at most of those companies, and at most other companies across the country, is still very white and very male.
The lack of women leaders in corporate America is a problem that has only become worse during the economic downturn. Attempts to make things better have done little to poke even a small hole in the glass ceiling. If a company is OK with its lack of gender diversity there are no laws to force the issue.
Of the companies in the Standard & Poor’s 100 index, which tracks some of the nation’s largest and most established publicly traded companies, women make up about 18 percent of the director positions and only 8.4 percent of the highest-paid positions, according to Calvert. And women executives were three times more likely to lose their jobs than their male counterparts during the Great Recession, a survey by research firm Catalyst found.
In yet another blow to women trying to get a level playing field, the U.S. Supreme Court has sided with Wal-Mart in what would have been the biggest gender bias suit in the nation's history. More than 1 million female employees at the retail giant had alleged they were paid less than men and not given the same opportunities for advancement. They sought a class-action suit for their case, but the high court ruled Monday that the suit could not move forward.
In the court's opinion, Justice Antonin Scalia wrote that there was no "general policy of discrimination" at Wal-Mart. But alas, gender bias, or any bias at all, is rarely a clear cut company policy.
“Change is slow,” said Diana Bilimoria, a professor of organizational behavior at Weatherhead School of Management at Case Western Reserve University. “No question about it, diversity is challenging,” she continued, adding that “the big question is how do we encourage board chairs, CEOs and directors to realize the value of diversity?”
There are a few U.S. companies that actually get it.
There are only 45 companies in the Fortune 500 — a list that ranks the top 500 U.S. companies by gross revenue — whose boards are more than 40 percent women, according to a list Catalyst has compiled. And only 18 corporations had 40 percent or more female executive officers.
One company that has both of these distinctions is Principal Financial Group. The company has four women board members out of 10 and six female top executives.
“The Principal has always had an inclusive culture and environment,” said Karen Shaff, executive vice president and general counsel at Principal.
“From my prior law firm experience and knowledge of other companies I think there has been less of a mindset of inclusiveness and appreciation of the benefits of a diverse workforce,” she said.
Mary O’Keefe, chief marketing officer for the firm, said four key factors help her and other women move up: mentoring, flexible schedules, a robust succession planning program and no mommy- or daddy-track penalties if employees take time off for family issues.
The company, she said, is committed to gender diversity. There’s “a conscious attitude that we value it, and we’re going to be inclusive and go after the best candidate” she added.
That approach makes economic sense to the firm’s CEO Larry Zimpleman.
“I believe having [a] good gender balance has been a competitive advantage for us,” he said. “There’s a growing body of research that indicates that women are more balanced and thoughtful in making important decisions. So, if improving a company's performance is of interest, then having good gender balance in key management positions as well as on your board will help achieve that objective.”
For most companies, however, even if it is a desired goal, gender balance can be an uphill battle. Many board members are culled from the executive suites of major corporations, but without a lot of women in those key management seats, there are slim pickings.
That’s why companies have to think outside the c-suite box and look for women from non-profit organizations, or for women that run major divisions at corporations, said Janice Ellig, co-CEO of executive search firm Chadick Ellig.
Companies that are not motivated to search in these places may need a bit more arm-twisting, she added. In 2009, a new Securities & Exchange Commission rule went into effect requiring that companies disclose how diversity is considered when new board members are nominated. Unfortunately, the rule didn’t mandate that companies actually have a diversity plan, Ellig said.
“I say put more teeth into those rules,” she demanded.
But Ellig stopped short of recommending U.S. companies be forced to meet gender quotas on boards, or in management jobs, something that has happened in other countries.
The lack of female leaders in business is a global problem. Some nations have taken it upon themselves to mandate more women be added to the leadership rolls, especially in light of a stream of studies that show more female board members can mean more profits for corporations.
In 2003, Norway passed a law requiring that the boards of publicly held companies consist of at least 40 percent female members, up from about 10 percent that was the average at the time. Other European countries are considering following suit.
Early studies of how the quota has impacted Norwegian companies show a slight decline in profits, but fewer layoffs and a perceived focus on longer-term viability than short-term payoffs, according to a report called “A Female Style in Corporate Leadership” compiled by professors at the University of Virginia and the Kellogg School of Management at Northwestern University.
Stefan Ranstrand, chairman of Tomra, a waste management firm in Asker, Norway, said it’s “good for the company as we add new dimensions to the decision making process; more [points of view] result in more decision options and finally a more well-thought-through decision. This ultimately contributes to higher quality decisions and a better representation of various stakeholder groups in general.”
Whether mandated, or brought about by “inclusive minded” corporations, getting more women to the top spots in Corporate America will also take a lot of work by women, management experts advise.
“We have to not wait to be asked to the party,” maintained Ellig. “Women have to connect with the people they know who have the influence or power to suggest them for board or C-suite positions.”
Indeed, a Harvard Business Review glass-ceiling report on women and mentoring found that:
“Most women believe that hard work alone will succeed in turning heads and netting rewards” and “underestimate the pivotal role sponsorship plays in their advancement.”
Principal’s O’Keefe believes having mentors helped to build her confidence and ultimately helped her to move up the ladder.
Managers, including the CEO, she said, were willing to spend time with her and even talk to her about the leadership roles she saw herself holding someday.
But, she admitted, “Maybe it was a bit of luck that this was the company I came to.”