Women on board: Beyond Quotas?

Val Myteberi

Program Director, The Samuel & Ronnie Heyman Center

on Corporate Governance - Cardozo School of Law

55 Fifth Avenue, New York, NY 10003

Macro Level U.S.A.

• Shareholder activism has

increasingly focused on:

• Board performance

• Quality of oversight

• Right of shareholders to replace

underperforming directors

Why Diversity?

• No bright-line tests for QUALITY of oversight:

• Research indicates that board quality is complex and

nuanced and depends as much on interpersonal

dynamics as individual skills and experience.

• Diversity as a means of increasing financial

performance and generating long-term value

for shareholders.

Why Diversity?

• Correlation between gender diversity and company

financial strength:

• Catalyst

• Columbia University

• Credit Suisse

• Deloitte

• McKinsey & Company

• The Committee for Economic Development

• Thompson Reuters

Institutional Investors – Public Pension Funds ($3 Trillion)

• NY State Common Retirement Fund (NYSCRF)

• NY City Pension Funds

• California Public Employees’ Retirement System

(CalPERS)

• California State Teachers’ Retirement System

(CalSTRS)

• Florida State Board of Administration

• Etc.

Actions• Collaboration

• Engagement

• Providing Resources

• Leading by example (Chief Diversity

Officer)

• City/State Contracts

Engagement

• Private dialogue

• Shareholder resolutions

• Proxy Access campaigns

• Example: Boardroom Accountability Project

by Comptroller Scott Stringer, New York

Attacking Process & Procedure

• Proxy Access since Fall 2014:

• Shareholders’ right to make their own board nominations.

• Comptroller Stringer – 75 proxy access shareholder proposals to

request a bylaw to give large shareholder (3% / 3Y threshold) the

right to list their candidates on a company’s ballot.

• Bank of America, Citigroup, EQT Corp., Staples etc. are agreeing

to adopt proxy access and amending their bylaws.

• Total of 16 companies have agreed to support meaningful proxy

access.

• EBay Inc. has hired two women to its board since January, bowing

to pressure, agreeing to “institutionalize a commitment” to

diversity.

Investors - Asset Managers($1.2 Trillion)

• Gender Lens Investing

• Access to capital for women entrepreneurs

and businesses.

• Investment that promote gender equality in

workplace.

• Investment that increase the number of

products and services that benefit women.

Investors - Asset Managers

• The Parity Portfolio – The Matterhorn Group,

Morgan Stanley:

• Highest financial standards: The Portfolio starts with

a Gender Lens but companies have to withstand the

rigorous financial analysis of portfolio managers.

• Sparking creativity in their Portfolio companies –

Biogen, Cambridge, MA with “Raising the Bar:

Women on Board” initiative.