Gender Diversity Survey – 2020 Proxy Season Results

By: David A. Bell , Dawn Belt , Ron C. Llewellyn

Fenwick’s gender diversity survey provides unique insight into women’s participation at the most senior levels of technology and life sciences public companies on the Fenwick – Bloomberg Law Silicon Valley 150 List (SV 150) and the large public companies of the Standard & Poor’s 100 Index (S&P 100). The report reviews public filings beginning in 1996 (the first year for which electronic filings with the SEC were broadly made in the EDGAR system) through the 2020 proxy season to analyze the gender makeup of boards, board leadership, board committees and executive management teams, in the two groups, with special comparisons showing how the 15 largest companies in the SV 150 by revenue (SV Top 15) fare. The SV Top 15 are the peers of the large public companies included in the S&P 100.

Our latest report indicates that company size continues to matter; the bigger the company, the more diverse its leadership. That is reflected in diversity numbers for the SV Top 15, which are generally similar to — and in some cases exceed — those of the S&P 100. While California’s 2018 law mandating specific gender diversity standards for companies based in the state seems to have moved the needle in the last two years, many SV 150 companies will need to add women at to their boards of directors to meet the law’s requirements in 2021.

Companies, board members and C-level executives can use this survey as a statistical benchmark for Silicon Valley leaders, as well as for comparison to the landscape of the largest public companies across the United States.

Download the report that reviews 25 years of filings to analyze the gender makeup of boards and management teams.

Key observations from the survey include:

New California law requires women in corporate leadership.

Most companies in the SV 150 met the initial 2019 standard affecting California-based public companies set out by SB 826, which mandates inclusion of women on boards of directors.

  • Our data show that 57% of SV 150 companies will need to add women to meet the law’s increased 2021 standards.
  • Most companies in the S&P 100 — all of which have boards with six or more directors — would meet the 2021 standard, with only 14% of this cohort having fewer than three women on their boards (the requirement for boards of six or more directors).
  • Combining March data from the California Secretary of State and our survey, it appears that at least 98% of SV 150 companies complied with the requirements of SB 826 in 2020.

Growth rates accelerated.

  • The representation of women on boards continued to increase between 2018 (the last year Fenwick published the gender diversity survey) and 2020 in the United States and at rates higher than in years past. The average percentage of women directors increased 8 percentage points in the SV 150 to 25.7% in 2020 and in the S&P 100 rose 4 percentage points to 28.7% (with the SV Top 15 increasing 4.5 percentage points to 30.3%).
  • In the last few years in both the S&P 100 and the SV Top 15, 100% of companies have had at least one woman director. In the SV 150 overall, the percentage of companies with at least one woman director increased 16.4 percentage points to 98%.

Fenwick Gender Diversity ScoreTM

Fenwick created the Gender Diversity Score in 2014 as a metric for assessing gender diversity overall. This composite score is based on data at the board and executive management level in the SV 150, SV Top 15, and S&P 100 each year over the last two-plus decades surveyed and in a set of categories selected as representative of the overall gender diversity picture.

A review of the annual score over the last 25 years shows that:

  • Gender diversity has improved over time, generally slowly, with some years showing no overall progress.
  • In the S&P 100, gender diversity has grown slowly but steadily at a cumulative rate of 61%, or a compound annual growth rate (CAGR) of 2.37%.
  • The SV 150 has lower scores overall, but a greater cumulative growth rate of 216%, and more than double the CAGR, 5.42%.
  • Among the SV Top 15, where the diversity score is now similar to the S&P 100, the cumulative growth rate has been 152%, or a CAGR of 3.89%, well above the S&P 100 but below the aggregate growth rate of the SV 150 over the period — although, after exceeding the S&P 100 in 2016, the diversity score for the SV Top 15 has not returned to that peak over the last four years.

Size continues to matter; Board Leadership.

  • Larger companies by revenue and market capitalization tend to have larger boards and executive management teams, which tend to be more diverse.
  • In recent years, the SV Top 15 have surpassed the S&P 100 in percentage of women in some board leadership positions, including board and committee chairs.
  • Women board chairs are rare across the U.S., but the SV Top 15 have in recent years more frequently had women board chairs than the similarly sized S&P 100 companies.
  • In the past, the SV Top 15 have generally surpassed their S&P 100 peers in appointing women as lead director; however, that didn’t hold true for 2020. The SV Top 15 didn’t have any women lead directors, while 11.8% of the S&P 100 had women lead directors.
  • In 2020, women were more likely than men to serve on primary board committees (audit, compensation, nominating) for S&P 100, SV 150 and SV Top 15 companies, showing that the women who serve on these boards, though fewer in number than men, are viewed as equal partners with their male peers. That has been the case now for more than half of the last 16 years.

Chief Executive Officers

Women CEOs continue to be a rarity in the United States, and companies in the SV 150 (4.7% of which have women CEOs) now fall behind the percentage of women CEOs in the S&P 500 (approximately 6.04%). The S&P 100, with 8% women CEOs, and SV Top 15, with 6.7% women CEOs, exceeded that rate.

Executive Officers

The growth rate of women executive officers, in terms of either the average number of women executive officers per company or the average percentage of executive officers that are women, has been faster in the S&P 100 over the survey period. However, the SV 150 has made significant gains in recent years. The average percentage of women executive officers in the SV Top 15 is now 21%, compared to 23.4% in the S&P 100.

Named Executive Officers (NEOs)

Named executive officers are the executives that are generally the most highly compensated and in some sense those that a company considers among the most important. As a group, the SV 150 has shown a faster rate of increase in the number of women NEOs.

Notably, the average percentage growth rate of women NEOs has been faster in the SV Top 15 (approximately 1,136% cumulative growth, or 10.96% CAGR) and the SV 150 generally (approximately 753% cumulative growth, or 9.35% CAGR) than in the S&P 100 (approximately 662% cumulative growth, or 8.85% CAGR).

What’s more, when measured in terms of likelihood of being an NEO among women that serve as executive officers, the SV 150 as a whole and the SV Top 15 have been significantly more likely to include women as NEOs than the S&P 100.

Gender of CEO did not correlate with presence of women NEOs.

2020 Gender Survey S&P 100 SV 150 SV Top 15
Women NEOs under Male CEO 18.0% 15.0% 20.0%
Women NEOs under Female CEO 19.0% 14.0% 20.0%

Care should be taken when comparing statistics for women and men serving as CEO, as the number of women CEOs is very low.

Full Coverage:

For each of the S&P 100, top 15 of the SV 150 and the full SV 150, the survey includes review of overall gender diversity in these groups (through the Fenwick Gender Diversity ScoreTM) and the gender diversity specifically of:

  • board of directors, including analysis in comparison to the recently adopted California gender quota
  • board committees
  • board and committee leadership
  • executive officers
  • NEOs
  • chief executive officer (CEO)
  • president/top operations executive
  • chief financial officer (CFO)
  • top legal officer/general counsel (GC)
  • top technology/engineering/r&d executive
  • top sales executive
  • top marketing executive
  • top corporate/business development executive

The survey also includes data broken down by the top 50, middle 50 and bottom 50 of the SV 150 in a variety of categories.