By: Catherine Yoshimoto, senior index product manager
A year has passed since I first took a closer look at how women CEOs are represented in our US index constituent companies. As the global women’s rights movement has continued to gain momentum over the past year, I thought I’d revisit these numbers to gauge whether we were any closer to gender parity in the corporate boardroom. Unfortunately, the glass still remains just 5% full for female CEOs for companies in the Russell 3000® Index.
As shown below, the percentage of female CEOs of companies in the Russell 3000 Index and a number of its subset indexes has remained relatively flat when comparing 2016 and 2017 figures, holding steady at 4–6% of total index constituent companies.
The most notable year-over-year change was in the Russell Top 200® Index, where the number of female CEOs dropped more than a full percentage point, bringing the total number of women CEOs in the index to 10 (down from 13 in 2016). Eight of the companies retained their women CEOs (though one stepped down in February 2018), but one retired and was succeeded by a man; two companies left the index, and two companies were acquired.
It’s worth noting that the two index constituent companies that hired female CEOs in 2017 – rounding out the 10 women CEOs of the Russell Top 200 Index – both experienced challenges in recent history. Some believe this is indicative of a larger trend, which Dr. Michelle Ryan and Professor Alex Haslam from the School of Psychology at the University of Exeter describe as the “glass cliff” where “women tend to be appointed to leadership positions...that are associated with an increased risk of criticism and failure.” These women CEOs are perhaps even set up to fail given a higher percentage of women CEOs were forced out compared to male CEOs over the 10 years ended 2013.
While this trend could present a significant barrier to increased women’s corporate leadership representation, strides have been made elsewhere to support progress. As noted in our recent UK Gender Pay Gap Report, the London Stock Exchange Group itself has committed to increasing our female representation both overall and at the senior management level from 30% to 40% globally by the end of 2020. Such measures are encouraging as we continue to monitor these statistics in the year ahead, looking for growth in corporate women’s leadership that is more reflective of the broader gender diversity movement.
In the indexing realm, FTSE Russell designed the Russell 1000 Women on Boards Leadership Index to integrate leadership in gender diversity into the Russell 1000 Index. The index increases exposure to companies based on the strength of their diversity leadership at the board level and how they manage wider impacts on society.
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