Fenwick & West LLP

Silicon Valley Corporate Governance & Gender Diversity

Fenwick & West LLPFenwick & West, one of the Silicon Valley’s premier law firms serving technology, venture capital and life sciences companies, released its Corporate Governance Survey and its adjunct Gender Diversity Survey. The surveys cover more than a decade of governance and leadership trends comparing companies in the S&P 100 and their relatively smaller and younger counterparts in the Silicon Valley 150 (SV 150), which are concentrated in the technology and life sciences industries.

Silicon Valley Corporate Governance

This year’s findings hold some surprises about corporate governance practices among Silicon Valley companies both at a high level and in significant detail:

Dual-class stock:

  • For Corporate Governance, the increased adoption of dual-class stock structures, once considered the type of outlier that only applied to a handful of special companies, demonstrates how much investor demand there is in the market for a certain set of hot, founder-led start-ups.
  • The use of dual-class stock structures more than doubled since 2011 to 7.3%, up from ~2-4% in prior years and allows founders to retain control of a company through preferred shares with outsized voting rights.

Classified Boards:

  • Classified boards are an important protection from shareholder activism and hostile takeovers that are especially relevant given the relative scale of the majority of tech companies going public.
  • Companies in the S&P 100 have a degree of inherent protection from activists and hostile takeovers in part due to their much larger size, so we’ve seen them declassify in recent years from ~47% a little more than a decade ago down to only 10% this year.
  • During that same 10 year period the number of SV 150 companies with classified boards has held solid at ~47%.


  • The quest to retain a strong voice in a company’s direction also shows up in the number of insiders on boards in Silicon Valley. SV 150 companies continue to have more insiders as a percentage of the full board (largely a result of having smaller boards), while S&P 100 companies continue to have more insiders in absolute numbers.
  • While there has been a longer term downward trend in insiders, both groups have held essentially steady over the past six proxy seasons.

Board Leadership:

  • Silicon Valley companies are substantially less likely to have a combined Chair and CEO than S&P 100 Companies (36% compared to 69%), though there has been a general downward trend in both groups that continued in the 2014 proxy season.
  • Where there is a board chair separate from the CEO, they are also substantially more likely to be a non-insider at SV 150 companies (in the 2014 proxy season, 71% compared to 52%) – though the S&P 100 increased markedly in the 2014 proxy season.

Silicon Valley Gender Diversity

  • Women directors are twice as common among S&P 100 companies (in the 2014 proxy season, 21% compared to 10% in terms of average percentage of each board that are women). While board membership for women peaked in the SV 150 in the 2008 proxy season, the overall trend is still upward in both groups.
  • Contrary to popular expectation, data shows that women CEOs do not appear to lead to increased percentages of women serving on boards or in the executive suites of S&P100 companies. Similarly, in Silicon Valley, having a woman on the Board or serving as CEO does not translate into more women in other Board or leadership positions.
  • However, there are bright spots:  in the top 15 companies of the SV 150 (the SV Top 15 are essentially peers of the S&P 100), the percentage of women serving as President/ COO is substantially higher than in the S&P 100 (and significantly higher than the current percentage of women CEOs). These women are already leaders and are likely future CEOs. (For example Safra Katz, counted as a Co‑President during the survey period, is now Co-CEO at Oracle.)  Similarly, unlike the S&P 100, the percentage of women President/ COOs is almost four times the percentage of women CEOs in the full SV 150.
  • Another positive indicator is compensation among women executive officers in the SV 150. Where women are executive officers they are meaningfully more likely in the SV 150 than in the S&P 100 to be Named Executive Officers (NEOs), a designation correlated to the highest compensated executives.
  • 2014 also marks the first year the survey includes the Fenwick Gender Diversity ScoreTM, a composite score based on Gender Diversity Survey data at the board and executive management level in the SV 150, S&P 100, and the SV Top 15 over the 19 years surveyed. The Gender Diversity Score should be viewed not as a grade, but as the larger context in which to view individual category changes – it reflects the aggregate overall trend in gender diversity.

Co-Authors of Silicon Valley Studies

“When the sample size of women in executive positions is not large to begin with, even a small change can look statistically significant; and the metaphor extends to other categories of governance,” co-author David Bell noted. “By adding the Fenwick Gender Diversity Score and simultaneously releasing the Corporate Governance Survey, we hope to provide both context and a macro view so that readers can choose their level of detail, from broad to extraordinarily nuanced.”

Said Theresia Gouw, prominent venture capitalist and co-founder of Aspect Ventures,

Fenwick’s Corporate Governance Survey and its Gender Diversity Survey are excellent resources and bring robust data to discussions around governance practices and the gender makeup of the leadership ranks of companies in the technology sector and nationwide. Gender diversity is an issue I care deeply about and I commend Dave Bell and Shu White for their work compiling and analyzing 19 years of data to highlight some of the trends we see around women leaders in Silicon Valley. This report offers insights into some key areas for growth and can be seen as an aide to companies looking to benchmark and improve their gender diversity.

Fenwick did not originally set out to analyze gender data. Now in its second year, the Gender Diversity Survey has grown into its own out of Fenwick’s Corporate Governance Survey, which analyzes overall trends in management, leadership and governance.

The gender diversity data was striking enough that co-authors David A. Bell and Shulamite Shen White believed it merited its own analysis. However, because the data and analysis was unprecedented, it generated more interest than its authors could have anticipated. Accordingly, the firm decided to release the Surveys together this year, so that each could provide context for the other and provide a more complete picture of trends in leadership and governance in Silicon Valley and the S&P 100.

Complete results of the surveys with related discussion are posted on Fenwick & West’s website at Fenwick.com/CorporateGovernance and Fenwick.com/GenderDiversity.

About the Silicon Valley Surveys

The Fenwick & West Corporate Governance Survey is authored by law firm partner David A. Bell, and the Fenwick & West Gender Diversity Survey is co-authored by David A. Bell and associate Shulamite Shen White.

The Corporate Governance survey provides insight into corporate governance practices of the companies included in the Standard & Poor’s 100 Index (S&P 100) and the high technology and life sciences companies included in the Silicon Valley 150 Index (SV 150) each year. This unique body of information covers corporate governance trends for the period following the passage and implementation of the Sarbanes-Oxley Act of 2002.

The Gender Diversity Survey looks at the same group of companies with an eye toward women’s participation in leadership positions. This in-depth set of information covers gender diversity trends for the period between the 1996 proxy season through the 2014 proxy season.

Both surveys contain valuable data and intelligence for publicly traded technology and life sciences companies across the U.S. as well as public companies of all sizes and across industries generally.

About Fenwick & West

Fenwick & West provides comprehensive legal services to ground-breaking technology and life sciences companies at every stage of their lifecycle. We craft innovative, cost-effective and practical solutions for established and emerging companies on issues ranging from venture capital, public offerings, joint ventures, M&A and strategic relationships, to intellectual property, litigation and dispute resolution, taxation, antitrust, and employment and labor law. For more than four decades, Fenwick has helped some of the world’s most recognized companies become and remain market leaders.

Additional Background on Silicon Valley Exceptionalism

Weathering a Crisis: Weil in Silicon Valley

Is Silicon Valley Different?: A Conversation with Vice Chancellor J. Travis Laster


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