Released this past October, BDO USA, LLP published The BDO 600: 2019 Study of Board Compensation Practices of Mid-Market Public Companies. The study looked at the compensation practices of publicly traded companies. Specifically included in the study were: energy, healthcare, manufacturing, real estate, retail and technology companies with annual revenues between $100 million and $3 billion. Also included in the study were banking financial services and nonbanking financial services with assets between $100 million and $6 billion. Data sources included data provided by Salary.com and public company data collected from proxies and other sources.
Gender Diversity on Boards
In addition to compensation practices, the analysis by BDO USA, LLP, examined key board trends including:
- term limits
- board structure
- stock ownership guidelines
- representation of women on boards
“The report,” stated BDO USA LLP in a release to the media, “shows signs of progress in board diversification between 2017 and 2018, with more women on boards.”
Eighty-nine percent of companies surveyed reported having at least one woman on their board in 2018 compared with 82 percent in 2017. Among smaller companies, the shift toward improved gender diversity was even greater, with 80 percent of smaller companies reporting at least one female on their board vs. only 70 percent in 2017.
Interestingly, although energy companies still have the lowest levels of female representation in their boards, the percentage increased from 63 percent in 2017 to 73 percent in 2018.
Amy Rojik, National Assurance Partner and director of BDO’s Center for Corporate Governance and Financial Reporting, points out that although change is slow, she expects the pace to increase in the future. “Board member gender diversity,” said Rojik, “has become a high priority as pressure escalates from shareholder activists, legislators, and regulators. While progress is coming slowly, I do expect we’ll see the picture shift even more dramatically in next year’s analysis.”
Currently, among the 600 companies that BDO analyzed, women comprise 19 percent of the total board population. Only 7 percent of the companies participating in the study have a board where women make up at least one-third of its members.
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