Tag Archives | EU

Women on Corporate Boards: Global Trends for Promoting Diversity

WomenOnBoardsWe last explored the topic of gender diversity on boards, in particular the underrepresentation of women on them, late in 2012, but much has happened globally on the subject since then. More companies have adopted regulation on the issue that range from “comply-or-explain” rules to quotas for the percentage of women on boards.

A 2014 Grant Thornton report, Women in Business: From Classroom to Boardroom, finds more leaders warming to a quota system, with 45% of international business leaders supporting quotas — up from 37% just a year ago.

Below is a brief summary of some of the most recent developments concerning women on boards. Continue Reading →

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Investing in Women & Inalienable Rights: Part II

Yesterday, in Part I, I discussed the most recent UC Davis Study of California Women Business Leaders: A Census of Women Directors and Executive Officers and how it led me to invest disproportionately in firms with more women CEOs and NEOs. Just how are women different than men and what kind of changes can we expect or hope for?

More Evidence Women Leaders Make Difference

And there is this from a recent article in The Economist (Vive la différence!, 12/7/2013): Men&WomenBrainWiring

MEN and women do not think in the same ways. Few would disagree with that. And science has quantified some of those differences. Men, it is pretty well established, have better motor and spatial abilities than women, and more monomaniacal patterns of thought. Women have better memories, are more socially adept, and are better at dealing with several things at once. There is a lot of overlap, obviously. But on average these observations are true…

the cross-talk between them in women, suggested by the wiring diagrams, helps explain their better memories, social adeptness and ability to multitask, all of which benefit from the hemispheres collaborating. In men, by contrast, within-hemisphere links let them focus on things that do not need complex inputs from both hemispheres. Continue Reading →

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Investing in Women & Inalienable Rights: Part I

UCDstudyCAWomenBusinessLeadersSince starting this blog in 1995, I’ve pushed for greater diversity on boards and in named executive officers (NEOs). Progress has proceeded at a glacial pace, at least in the United States. For the ninth year, the UC Davis Graduate School of Management, in partnership with Watermark, published the annual UC Davis Study of California Women Business Leaders: A Census of Women Directors and Executive Officers. The study found the average Top 25 firms (which have 25+% women at upper levels) makes three times as much revenue and almost 50% more net income than the average company in the study (which has 10.9% women).

After reading the study, I took the plunge, investing in seven of the top 25 California companies with the highest percentage of women leaders. Hopefully, investing in women will reap additional rewards and will help me carry on with my efforts to make corporate governance more democratic. Women obviously bring a different perspective that pays financial dividends. Will women in positions of power also result in a more salubrious environment, recognition of human rights and a more equitable distribution of wealth?

I invested in the following: Annie’s (BNNY), Medivation (MDVN), Genomic Health (GHDX), Bio-Rad Laboratories (BIO), NETGEAR (NTGR), Symantec (SYMC), and Visa (V). I’ve been trying to invest in Yahoo! (YHOO) and SciClone Pharmaceuticals (SCLN) but haven’t been successful at the prices I’ve bid. I already had investments in Walt Disney (DIS). See all my investments under Disclosures. Continue Reading →

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Video Friday: Women on Boards & Glass Ceilings

A range of videos on the subject. The most recent EU proposal sets out a 40% “objective,” with unspecified sanctions against companies flouting the rules. The proposals would require companies to have clear, gender-neutral criteria for choosing non-executive directors and that if candidates are found to be equally qualified, then preference should be given to women. As long as companies have suitable systems in place, it appears they will not be penalized if they do not manage to meet the 40% level by 2020.  (EU defends women-on-boards plans, BBC, 11/14/2012) Continue Reading →

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Women on Boards: EU Commission Proposes 40% Objective

Despite an intense public debate and some voluntary initiatives at national and European level, the situation has not changed significantly in recent years: an incremental average increase of the number of women on boards of just 0.6 percentage points per year has been recorded since 2003.

It is for this reason that the Commission is today proposing EU legislation to accelerate progress towards a better gender balance on the corporate boards of European companies. The proposal was presented jointly by Vice-President Viviane Reding (Justice, Fundamental Rights and Citizenship), Vice-President Antonio Tajani (Industry and Entrepreneurship), Vice-President Joaquín Almunia (Competition), Vice-President Olli Rehn (Economic and Monetary Affairs), Commissioner Michel Barnier (Internal Market and Services) and Commissioner László Andor (Employment and Social Affairs). Continue Reading →

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EU May Mandate CorpGov Measures

A “say on pay” could be introduced across Europe, along with potential quotas for the number of women in boardrooms, as a result of proposals outlined by the European commission.

British companies have been required to put their remuneration policies to a shareholder vote since 2003 when pharmaceutical company GlaxoSmithKline became the first company to have its pay plan opposed by its investors.

Europe is now asking whether companies across the 27 member states should be forced to put their remuneration policies to a vote by shareholders – and indeed even make disclosure on pay mandatory for both executive and individual directors for the first time in some countries.

The green paper said: “A mismatch between performance and executive directors’ remuneration has also come to light.”

(EC proposes ‘say on pay’ and quotas for women in the boardroom | Business | The Guardian., )
Responses to 25 questions outlined in a green paper are due by July, the commission asked whether companies should be required to “ensure a better gender balance on boards” than the current 12% across the EU.

I found several of the 25 questions equally interesting, including the following:

  • Should the EU seek to ensure that the functions and duties of the chairperson of the board of directors and the chief executive officer are clearly divided?
  • Should recruitment policies be more specific about the profile of directors, including the chairman, to ensure that they have the right skills and that the board is suitably diverse? If so, how could that be best achieved and at what level of governance, i.e. at national, EU or international level?
  • Please point to any existing EU legal rules which, in your view, may contribute to inappropriate short-termism among investors and suggest how these rules could be changed to prevent such behaviour.
  • Are there measures to be taken, and if  so, which ones, as regards the incentive structures for and performance evaluation of asset managers managing long-term institutional investors’ portfolios?
  • Should EU rules require a  certain independence of the asset managers’ governing body, for example from its parent company, or are other (legislative) measures needed to enhance disclosure and management of conflicts of interest?
  • Are there measures to be taken, and is so, which ones, to promote at EU level employee share ownership?

Interested parties are invited to submit their views on the suggestions set out in the
Green Paper. Contributions should be sent to the following address to reach the Commission by 22 July 2011 at the latest: [email protected]. Contributions will be published on the internet.

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EU Offers Prize for ESG Integration

The overall objective of this call for proposals is to enhance market reward for sustainable and socially responsible enterprises, so facilitating the transition towards a sustainable economy.

The specific objective is to build the capacity of mainstream investment actors to better integrate environmental, social and governance information into their valuations of enterprises. This call for proposals is also an opportunity for the investment community to further align its practices with the expectations of European public policy.  Latest news from DG Enterprise and Industry.

Yes, the European Unions wants to drive ESG into the heart of investing considerations. The deadline for responses is set for May 20. Can anyone imagine the United States offering a prize of over $350,000 to prompt the integration of environmental, social and governance issues into the valuations of mainstream institutional investors? Please let me know when you see it. Hat tip to SHARE newsletter. Don’t miss out; subscribe now.

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