Women on corporate boards

'Diversity' is the buzzword du jour, but when it comes ___ corporate boards, there is more talk than

action: Women make ___ only one ___ ___ six company directors. Does that affect corporate performance?

(Fortune Magazine) - There's lots of good news ___ the rise ___ women ___ the corporate world, such as

the 29 CEOs ___ public companies ___ our global Most Powerful Women rankings and an impressive lineup

of female CEOs-in-waiting. ___ the headlines, though, there is a hidden phenomenon. A surprisingly large

number of corporate giants still have no women directors ___ their boards.

Surveying the 2007 proxies of the S&P 500, Spencer Stuart, the executive-search firm, found that 9%

had all-male boards. That's an amazing 45 female-free zones. The list includes Apple, News Corp, and

Zimmer Holdings, a leader in the joint-replacement market that peddles a Gender Solutions hip designed

___ women.

"It's mind-boggling to me," says Mellody Hobson, president of Ariel Capital Management and a director at

Starbucks, DreamWorks Animation SKG, and Estee Lauder.

Companies can do just fine ___ female directors, of course. Rupert Murdoch's News Corp. is thriving, and

Apple's stock price has almost doubled ___ the past year. But isn't it possible that the guys who run Bear

Stearns and Countrywide Financial, which both took on way too much risk and suffered in the recent credit

crises, might have benefited ___ a few women ___ the boardroom?

___ fact, there may be a connection ___ the presence ___ women ___ boards and financial performance.

Researchers at Catalyst, which monitors the progress ___ executive women, just completed a study showing

that companies ___ at least three women directors performed significantly better than average ___ terms

___ return ___ equity and return ___ sales (both six percentage points better) and return ___ invested

capital (four percentage points better). Catalyst's study, strangely, covers 2001 to 2004. Even so, the results

are intriguing.

So why don't boards mix it ___ more? ___ one thing, women are choosy. Pitney Bowes chairman Mike

Critelli, who has two female directors and is looking ___ a third, says with frustration, "We've been turned

___ a lot ___ interesting candidates." The best-qualified women, he says, tend to have many corporate

suitors, typically growth companies ___ growth industries like technology and consumer goods.

"He's correct," says Julie Daum, who heads Spencer Stuart's North American board-search practice. "And if

they're working CEOs, like Meg Whitman or Andrea Jung or Anne Mulcahy, they're likely to pick just one or

two boards besides their own." Spencer Stuart found that 70% ___ the S&P 500 companies it surveyed say

they are seeking women directors. But only 19% ___ new independent board members added this year were

women.

All told, 16% ___ board members are women. That's higher than ever before, but given the increasing power

___ women both as consumers and as leaders, the figure still seems absurdly low.

Maggie Wilderotter, CEO of Citizens Communications, a telecom company, is one ___ the female pioneers.

In July she became Yahoo's first woman director. Wilderotter, who earned her stripes at AT&T and

Microsoft, says she's been ___ 15 corporate boards and was the first woman ___ every one except Xerox

(where she is currently a director) and McClatchy, the newspaper company.

At Citizens, where she became CEO ___ 2004 and chairman last year, she has remade what had been

an all-male, all-white board. Now Citizens' dozen directors include five women and two African-American

men. "I've always suspected that companies that are inclusive and have different points ___ view will

perform better ___ shareholders," Wilderotter says. Hobson predicts that diversity ___ boardrooms will

evolve, but slowly: "I'd love to have a view that's less controversial, but I think bias still exists."