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November 01, 2010
Women and Minorities Are Underrepresented in Highest-Paid Executive Positions
    by Robert Kropp

A report by Calvert finds improved disclosure of policies addressing gender diversity among S&P 100 companies, but insufficient disclosure of the effectiveness of those policies.

The business case for gender equality and diversity has been strengthened by reports such as Wom en Matter 3, published by McKinsey and Co., and Wome n Hold Up Half the Sky, from Goldman Sachs. The report from McKinsey, for instance, found "a correlation between the proportion of women serving on a firm's executive board and how well that firm performed both organizationally and financially."

Shareowner activists have long recognized the relationship between gender diversity and firm performance, and have submitted resolutions requesting race and gender diversity for years. As far back as 2003, for instance,
Calvert submitted resolutions on the issue that won 38.8% of shareowner votes at Gentex, and 28.6% at Danaher. In the same year, a resolution filed with Molex was withdrawn after the company appointed the first woman to its board.

In 2004, Calvert launched the
Calvert Women's Principles, an initiative that led to the publication earlier this year of Women's Empowerment Principles Equality Means Business by the United Nations Development Fund for Women (UNIFEM) and the United Nations Global Compact. That document, in turn, led to an initiative by a coalition of investors, including Calvert, that called on 54 companies to increase representation of women on their corporate boards and in senior management.

Now, Calvert has published a new study, entitled
Examining the Cracks in the Ceiling: A Survey of Corporate Diversity Practices of the S&P 100, a follow-up to a 2008 report on the same issue. The new report comes at a time of a significant demographic milestone, as the US Bureau of Labor Statistics reported earlier this year that "for the first time, women outnumbered men on the nation's payrolls," according to Barbara Krumsiek, President of Calvert.

The report found that while "overall disclosure of diversity policies and programs is strong" among S&P 100 companies, a lack of transparency persists in corporate disclosure of the effectiveness of policies. Thirty-seven percent of companies do not disclose EEO-1 data, which, according to Calvert, "is critical to demonstrating how successfully women and minorities are advancing throughout a company's ranks."

Despite improved overall disclosure, more than half of S&P 100 companies have no female and/or minority representation in the highest paid executive positions. Only 8.4% of the highest paid executive positions are held by women; 92 of the CEO positions are held by white males.

Basing its analysis on ten diversity indicators, Calvert found that a majority of S&P 100 companies scored in the top half of the spectrum. The companies performed especially well on indicators relating to internal diversity initiatives, family-friendly benefits, and board representation. Ninety-seven percent of companies have at least one woman and/or minority representative on their boards.

The highest-scoring companies in Calvert's study were Citigroup, Sara Lee, JPMorgan Chase, Coca-Cola, and Chevron. Companies with the lowest scores were Philip Morris, National Oilwell Varco, and Berkshire Hathaway.

Calvert provided recommendations for improved gender representation that include engagement with key stakeholders on the issue, improved disclosure, and support for public policy efforts relating to gender equality.


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