Companies adding diversity to boards
Women now have a seat in all the boardrooms of Pittsburgh’s largest publicly held companies.
Two companies that lacked female representation on their boards — Evoqua Water Technologies and II-VI — each added a woman director in the past year.
Those appointments and others at companies that already had women pushed the overall share of females on Pittsburgh corporate boards to 26%, up from 24% a year ago.
But while women slowly gain a wider presence as corporate directors, diversity proponents say there’s still a wide racial gap on corporate boards that could be hindering the region’s growth and progress.
“We have seen an uptick in gender diversity on boards and in the c-suites, but those women tend to be white and don’t look like me,” said Sabrina Saunders Mosby, a Black woman who is president and chief executive of Vibrant Pittsburgh, a nonprofit that promotes workforce diversity.
The Vibrant Index report released last month by Vibrant Pittsburgh called for better diversity and inclusion training at local companies in order to help build a stronger pipeline of diverse candidates for boards and executive positions.
The percentage of women on Pittsburgh corporate boards mirrors the 26% of women directors on the boards of S&P 500 companies at the end of 2019, according to Catalyst,
a New York-based research firm that tracks women in the workplace and on boards.
The local data includes 58 public
companies based in the Pittsburgh region or with significant operations here.
The percentage gets a boost from regional firms like Covestro, Bayer and Siemens AG because they are headquartered in Europe where for years quotas have been in place to ensure more women are represented.
The Pittsburgh company with the highest percentage of female directors is EQT Corp., at 50%.
A year ago, the energy company’s shareholders voted to install a new board and management team led by investor Toby Rice, and the shift in control doubled the number of women on its board to six out of 12 total directors.
One of the women who gained a seat, Lydia Beebe, a former Chevron executive, now chairs EQT’s board.
AK Steel added two women following its acquisition in March by iron ore pellets maker ClevelandCliffs, and Howmet Aerospace, a spinoff of Arconic Corp., launched in April with three women directors, who comprise 30% of its board.
Companies that added one female director in the past year, besides Evoqua and II-VI, were: Arconic, Bayer, Comcast, Covestro, Eaton, First Commonwealth Financial, GNC, Range Resources, TriState Capital Holdings, Wabtec, Wesco International and Koninklijke Philips, which owns local medical equipment producer Philips Respironics.
Among those that lost women directors was KeyCorp, following the May retirement of former chair and chief executive Beth Mooney, who was succeeded by a man.
Others were PPG, where two longtime directors stepped down but another was added in April; Kraft Heinz, where two left the board and one joined; and Verizon, where Carol Tomé left the board after being named as the next chief executive of United Parcel Service.
At 26%, the share of women on Pittsburgh-area public company boards “is a great number but not nearly where we need it to be,” said Rachel Allen, a director and founding member of the Three Rivers Chapter of the National Association of Corporate Directors.
“Women are 50% of the population,” she noted.
NACD, an Arlington, Va.based organization that offers training programs and certifications for directors, has made a strong push for board diversity, including people of color.
“We try to educate boards that having diverse members isn’t just the right thing to do; it’s the right thing to do because diverse boards deliver better returns to shareholders,” said Ms. Allen, general counsel for ALung Technologies, a privately held South Side firm that develops medical devices to treat respiratory failure.
Research shows companies with women and other diverse members on their boards can attract a more diverse talent pool.
Also, board diversity can improve the bottom line because diverse directors help the business better respond to “a wide array of customers and stakeholders,” said Ms. Saunders Mosby.
Pittsburgh-area companies have made steady progress in adding women to boards since 2016 when the number stood at 17%.
Efforts like 2020 Women on Boards, a national initiative to reach 20% or more female board representation by this year, helped raise awareness by holding events in cities including Pittsburgh to discuss the benefits of diversity and by honoring companies and corporate leaders who showed commitment to adding women to their boards.
Because 2020 Women on Boards achieved its goal before 2020, NACD is working on initiatives for “overall diversity,” said Ms. Allen.
Women of color comprise close to 5% of directors at Fortune 500 companies, according to a January report from Catalyst.
White men account for 66%; white women, nearly 18%; and men of color, almost 12%.
Latinos hold less than 1% of all board seats, Catalyst said.
Among the women of color on local boards are Sonja Wilkerson and Sharon Feng at Koppers; Marjorie Rodgers Cheshire and Toni Townes-Whitley at PNC Financial Services Group; Sujatha Chandrasekaran, American Eagle Outfitters; Aradhna Oliphant, First Commonwealth Financial; and Sandra Phillips Rogers, MSA Safety.
Ms. Saunders Mosby worries without more women of color, boards could “essentially become the next good old boys club” for white women.
A wave of recent protests for racial justice has prompted many corporations to publicize their commitments to diversity and could help shine a light on boards, Ms. Saunders Mosby and Ms. Allen said.
The Black Lives Matter movement “has created awareness in every aspect of our lives, … and hopefully, one of those aspects is board service,” said Ms. Allen, who sits on several nonprofit boards, including the Community College of Allegheny County’s Educational Foundation and the Women’s Center & Shelter of Greater Pittsburgh.
In a past career as a venture capitalist, she was a director on 30-plus corporate boards, including one public company.
“Every board I’m on, we’re having a conversation of self-reflection and asking if we are doing enough [to address diversity],” said Ms. Allen.
A challenge to recruiting more diverse board members at public companies is the tiny pool of minorities in the executive suite and the management pipeline who are being groomed for board service, she said.
“We need to foster the development of minority candidates. I’ve been in Pittsburgh 30 years in my professional career and having the same conversations about retaining minorities in the corporate ranks.”
For the Vibrant Index, 50 local organizations employing a total of about 140,000 workers in the region were asked about diversity and inclusion practices including recruitment, training, supplier diversity and employee resource groups.
While 88% said they provided diversity training, only 30% offered it directly to human resources and hiring personnel.
Among Vibrant’s recommendations was making sure such training involves people responsible for recruitment and retention.
Other recommendations included assigning one individual or committee to oversee diversity and inclusion.
In the report, 48% of participants said one or fewer people were responsible for those efforts.
Vibrant also recommended having top executives head diversity and inclusion initiatives and having them share results of those efforts with the board.
Local executives that are getting it right with diverse boards and management teams, said Ms. Saunders Mosby, include Leroy Ball, president and chief executive at Koppers; William Demchak, chairman and chief executive at PNC; and Steven Malnight, president and chief executive at Duquesne Light.
“Diversity begins with thought leaders who make diversity imperative,” said Ms. Saunders Mosby. “That includes the board because they are setting the pace and expectations for the company.”