Board Diversity: who has a seat at the table?

Diversity is a word that has become ingrained in the corporate governance lexicon in recent years. In 2010, the Alliance for Board Diversity found that, of the boards of directors of Fortune 100 companies, 72.9% of all corporate board seats were held by white men. Minorities and women shared the remainder, with very few seats occupied by Asian Pacific Islanders, Hispanics, or minority women in particular. The report indicates that such levels have remained unchanged since 2004. In light of these statistics outlined in this report, it is no surprise that the focus on increasing diverse representation on corporate boards has gained steam in recent years. This article examines current trends with respect to board diversity in Europe and in the US in light of quota systems put in place in Europe, support from federal regulators and pressure from institutional investors. Corporations that fail to take measures to diversify their boards of directors may be targeted by institutional investors.