The 2010 Minnesota Census of Women in Corporate Leadership How Minnesota’S Top Public Companies Rank
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~ PAID ADVERTISING SUPPLEMENT TO THE BUSINES JOURNAL ~ The 2010 Minnesota Census of Women in Corporate Leadership How Minnesota’s Top Public Companies Rank Report produced by St. Catherine University and the Minnesota Women’s Economic Roundtable 2 APRIL 1, 2011 – THE 2010 MINNESOTA CENSUS OF WOMEN IN CORPORATE LEADERSHIP – PAID ADVERTISING SUPPLEMENT TO THE BUSINESS JOURNAL TIME TO TAKE ACTION Increasing the number of women in corporate leadership is good governance. The third annual Minnesota Census of Women in Corporate Leadership reveals that women have made little progress in joining the top leadership ranks of Minnesota’s largest 100 publicly held companies over the past year. Consider the evidence: QWomen hold 14.3 percent of the available board seats in Minnesota’s 100 largest publicly held companies; that’s 116 of the 814 board seats available in 2010. The number of seats held by women declined between 2009 and 2010 by three seats. QTwenty-eight of the top 100 public companies in Minnesota have no women board members. QForty-one of the top 100 public companies have only one woman on their boards. QEight companies showed a net increase of one woman on their boards. Four companies had a net decrease in the number of women on their boards. QOnly 12 of the top 100 public companies in Minnesota include women of color among their women board members. Lack of gender diversity in top corporate ranks — including the executive suite — is more than an issue of equity. Gender imbalance fundamentally shapes business performance and ultimately impacts the economic future of our state. Women directors make substantive contributions to boards, according to the Harvard Business Review, including more collaborative approaches to leadership. Additional research suggests that the presence of at least three women on corporate boards correlates with improved fi nancial performance. To move our state forward, corporate leadership in Minnesota must draw upon the talents, skills and creativity of a more balanced representation of our population. LINDA HALL KELLER, Ph.D. PAULA MEYER steering committee co-chair, steering committee co-chair, The 2010 Minnesota Census of The 2010 Minnesota Census of Women in Corporate Leadership Women in Corporate Leadership E-mail the steering committee co-chairs at [email protected] Where Are the Women? Minnesota companies that include no women corporate directors or women executive offi cers (Section 16b) on their corporate leadership teams include: Broadview Institute, Inc. CEO Jeffrey Myhre Multiband Corp. CEO James Mandel Cardiovascular Systems, Inc. CEO David Martin Nortech Systems, Inc. CEO Michael Degen Compellent Technologies, Inc. CEO Philip Soran Rimage Corp. CEO Sherman Black Digi International, Inc. CEO Joseph Dunsmore Rochester Medical Corp. CEO Anthony Conway Entrex Corp. CEO Peter Hauser Stratysis, Inc. CEO Scott Crump Image Sensing Systems, Inc. CEO Ken Aubrey Vital Images, Inc. CEO Michael Carrel Insignia Systems, Inc. CEO Scott Drill Virtual Radiologic Corp. CEO Rob Kill IntriCon Corp. CEO Mark Gorder Winland Electronics, Inc. CEO Thomas dePetra Lakes Entertainment, Inc. CEO Lyle Berman WSI Industries, Inc. CEO Michael Pudil Mocon, Inc. CEO Robert Demorest Data based on SEC fi lings as of June 30, 2010. Electronic copies of The 2010 Minnesota Census of Women in Corporate Leadership are available at: mncensus.stkate.edu PAID ADVERTISING SUPPLEMENT TO THE BUSINESS JOURNAL – THE 2010 MINNESOTA CENSUS OF WOMEN IN CORPORATE LEADERSHIP – APRIL 1, 2011 3 EXECUTIVE SUMMARY By REBECCA HAWTHORNE, Ph.D. and JOANN BANGS, Ph.D. St. Catherine University, Master of Arts in Organizational Leadership The 2010 Minnesota Census of Women in Corporate Leadership presents a tale of stalled progress and missed opportunities. Only eight of Minnesota’s top 100 publicly held companies experienced a net gain in women corporate directors in 2010. Four companies experienced a net loss. Of the 72 new board seats that became available in 2010, only 14 seats were awarded to women. Lack of racial diversity is also an issue. Only 1.7 percent of the people who serve on Minnesota boards are women of color. One Minnesota company — Granite City Food & Brewery, Ltd. — added six board seats in 2010 and appointed six white men to fi ll them. Diversifying a corporate leadership team provides a competitive advantage. A handful of Minnesota’s Fortune® 500 companies are appointing highly qualifi ed women of color to their boards. Others must follow their lead. As in the two earlier versions of the Census, the 2010 Honor Roll is comprised of companies in which women make up at least 20 percent of the board and at least 20 percent of executive offi cers. “Special Distinction” is reserved for those companies in which women make up at least 30 percent of the board and at least 30 percent of executive offi cers. This year’s Honor Roll refl ects the tenuous progress companies have made toward diversifying their corporate boards and executive offi ces. In several cases, the departure of one or two women removes companies from Honor Roll recognition because they lack the critical mass to maintain a diverse leadership team. Consider: QSUPERVALU, INC. departed the Honor Roll after losing one woman director. QUnitedHealth Group, Inc. left the Honor Roll after it added two executive offi cers to its senior leadership ranks, both men. QFamous Dave’s of America, Inc. added one board seat, fi lled by a man, which took it off the Honor Roll. QSelect Comfort Corp. lost one woman director, which knocked it off the Honor Roll. The movement of these companies off the Honor Roll underscores why Minnesota corporations must attain critical mass in their leadership ranks for progress to occur. One woman director and/or one woman executive is not enough. Research on women in leadership A recent global survey by McKinsey & Company (2010) reveals that 72 percent of male and female executives believes gender diversity in corporate leadership leads to improved fi nancial performance. Yet translating belief into practice continues to elude many companies, including the majority of Minnesota’s top 100 publicly held companies. A body of widely recognized research links competitive advantage with boards that embrace diversity of gender, ethnicity and skill set (Deloitte, 2010; Ernst and Young, 2009; CalPERS, 2009; Catalyst, 2007). The presence of a critical mass of women in leadership improves the corporate bottom line in terms of both fi nancial profi ts and effective decision-making. Percent of Board Seats Held by Women Nationally A “critical mass,” according to Wellesley Centers for Women (2006), consists of three or more women — the number at Nationwide (497) which women directors and senior executives are perceived as individuals with unique skill sets and voices as opposed to California (51,400) representatives of their gender. The presence of three or more Chicago (28,50) women also shifts the dynamics of how boards operate, research shows. Florida (15,100) In 2010, only six Minnesota Census companies had three Georgia (13,150) or more women directors. This is a decline from the nine Kansas/Missouri (10,43) companies with three or more women directors in The 2009 Minnesota Census. Maryland (6,86) Despite an increasing number of highly qualifi ed women in the Massachusetts (11,100) leadership pipeline (48 percent of the labor force and 51 percent Michigan (17,17) of all management/professional positions, according to the White House Project, 2010), women’s progress beyond middle Minnesota (17,100) management has stalled. NYC Metro (64,100) Only in rare instances do we fi nd three women on the board or Philadelphia (12,100) in the senior executive offi ces of Minnesota’s top companies. Women CEOs lead only six of the 100 companies in The 2010 Tennessee (7,72) Minnesota Census. Texas (49,97) Engaging the talents, creativity and expertise of all highly qualifi ed Wisconsin (8,50) individuals — men and women working in partnership — will provide Minnesota with the strongest human capital upon which 0% 5% 10% 15% 20% 25% to build a resilient economic future. % Fortune® 500 director seats filled by women % director seats filled by women The numbers in parentheses indicate the number of companies in each region designated Fortune® 500, followed by the total number of companies in that region’s sample. 4 APRIL 2011 – THE 2010 MINNESOTA CENSUS OF WOMEN IN CORPORATE LEADERSHIP – PAID ADVERTISING SUPPLEMENT TO THE BUSINESS JOURNAL Women Serving on Minnesota’s Corporate Boards A look at the state’s top 100 public companies Women Corporate Directors by Company Size Women Corporate Directors by Seats (Based on SEC fi lings as of June 30, 2010) 80% 6 Fortune® 500 70% QWomen hold 14.3 percent (116) of the 814 available board seats in Minnesota’s 100 largest publicly held Fortune® 501–1000 companies, a net decrease of three seats from The 2009 Minnesota Census. The overall percentage of seats 60% 10 held by women corporate directors has not increased over the past three years. 50% Other 32 QThe percentage of seats held by women corporate directors tends to increase with company size. 40% 27 30% 2 Women Corporate Directors by Company 20% 3 13 3 10% QWomen serve on the boards of 72 of Minnesota’s 100 largest publicly held companies, a decrease of one 1 3 company from 2009. 0 0 Percent and Number of Companies 0% 0 1 2 3 or more QSix of the top 100 companies have three or more women corporate directors (down from nine in 2009), 25 companies have two women corporate directors, 41 have one woman corporate director and 28 have none. QMinnesota companies reporting larger revenues tend to have a greater number and percentage of women corporate directors than smaller companies. Companies with 3 or iiiOf the 17 Minnesota Fortune® 500 companies, three have three or more women corporate directors, 10 have two women corporate more women directors: directors, three have one woman corporate director and one (Nash Finch Co.) has none.