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Latest News - August 2012

August 5, 2012
Unions urge more female representation in corporate boardrooms
Source: Workday Minnesota
By: Brandon Rees

The AFL-CIO recently joined with other investors to ask corporations to nominate more women as directors.

AFL-CIO’s Secretary-Treasurer Elizabeth Shuler co-signed a letter with state officials from California, New York, Washington, Massachusetts and other states, as well as executives from the nation’s largest state pension funds, mutual fund companies and women’s organizations.

Investors sent the letter to the nominating committees of S&P 500 companies that do not have any women on their boards. These nominating committees select the director candidates whom shareholders are asked to approve at company annual meetings. Research shows that companies with women directors “are better-governed, better-managed and have better long-term growth prospects,” explained the letter.

Just this month, the investment bank Credit Suisse released a new report showing that companies with at least one woman on their board of directors outperform companies without any women directors. The report suggested that companies with diverse boards are better able to consider alternative viewpoints and solve problems than a group of like-minded individuals.

Gender diversity in the leadership of corporations is important for another reason. Although illegal, employment discrimination against women is still a serious problem in the United States. According to the U.S. Census Bureau, women are paid 77 cents for every dollar earned by men. Hopefully as corporate boardrooms become more diverse, companies will strengthen their nondiscrimination and equal pay policies.

The AFL-CIO and other organizations that signed the letter are members of the Thirty Percent Coalition, a group that wants 30 percent of corporate directors of all public companies to be women by 2015. A 2011 census of corporate directors showed that women are only 16.1 percent of directors of Fortune 500 companies, and have made essentially no gains in board seats in recent years.

At the 2005 and 2009 AFL-CIO Conventions, the AFL-CIO adopted resolutions to encourage more women and people of color at all levels in the union movement. Like the labor movement, corporations can and should be doing more to promote a diverse leadership for the 21st century.

 

 


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