State Street wants more women on boards

In­vest­ment com­pany to use its in­flu­ence for gen­der di­ver­sity

USA TODAY International Edition - - MONEY - Charisse Jones @ charis­se­jones USA TO­DAY

NEW YORK One of the in­vest­ment world’s larger play­ers said Tues­day it plans to use its in­flu­ence to com­pel com­pa­nies to put more women on their boards of di­rec­tors.

State Street Global Ad­vi­sors, which had $ 2.47 tril­lion un­der man­age­ment at the end of last year, wants the more than 3,500 busi­nesses that ben­e­fit from its clients’ in­vest­ments to make sure their gov­ern­ing boards are di­verse. And if they don’t, it will seek to push out those re­spon­si­ble for propos­ing new di­rec­tors by vot­ing against them.

“A key con­trib­u­tor to ef­fec­tive in­de­pen­dent board lead­er­ship is di­ver­sity of thought, which re­quires di­rec­tors with dif­fer­ent skills, back­grounds and ex­per­tise,’’ Ron O’Han­ley, State Street Global Ad­vi­sors’ CEO, said in a state­ment. “To­day, we are call­ing on com­pa­nies to take con­crete steps to in­crease gen­der di­ver­sity on their boards and have is­sued clear guid­ance to help them be­gin to take ac­tion.”

In Jan­uary, ex­ec­u­tive data firm Equilar found that at the cur­rent rate, it will take un­til the end of 2055 be­fore boards of di­rec­tors at com­pa­nies that are part of the Rus­sell 3000 will have equal num­bers of men and women.

At the end of last year, Equilar said women oc­cu­pied 15.1% of the board seats in those same com­pa­nies, up from 13.9% a year ear­lier.

State Street, based in Boston, cites nu­mer­ous stud­ies that show busi­nesses have a stronger fi­nan­cial per­for­mance when women are in se­nior po­si­tions. It points to a study by MSCI, a stock fund index re­search firm, that de­ter­mined that when women were key de­ci­sion- mak­ers, those busi­nesses saw an an­nual 10.1% re­turn on eq­uity as com­pared to 7.4% at com­pa­nies that lacked a sig­nif­i­cant num­ber of women in lead­er­ship.

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