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Study by Bentley and The Boston Club Says Massachusetts Companies Missed Opportunities to Place Women in Boardrooms in 2006

November 14, 2006

The percentage of women holding seats on the boards of directors of the 100 largest public companies in Massachusetts increased from 9.9% in 2005 to 10.8% in 2006, according to a study for the Boston Club by three Bentley researchers. But analysis of board turnover among 94 companies that were included in both the 2005 and 2006 reports concludes that corporate leaders largely ignored the pool of talent among senior business and professional women to fill those vacancies.

Two Bentley professors and an executive-in-residence at the Women's Leadership Institute at Bentley concluded in the 2006 Census of Women Directors and Executive Officers of Massachusetts Public Companies that the period from July 1, 2005 - June 30, 2006, was a year of "missed opportunities" to add women to the boardrooms.

The Bentley study, produced in partnership with The Boston Club and Mercer Human Resources Consulting, was presented on November 14 at the Fairmont Copley Plaza by Bentley Associate Professor of Management Susan Adams on behalf of her co-authors Patricia Flynn, Trustee Professor of Economics and Management, and Toni Wolfman, executive-in-residence at the Women's Leadership Institute at Bentley.

"The report essentially debunks the myth that companies aren't placing women on their boards due to a lack of openings," says Adams. "In fact, almost 9% of the current directors in these companies were appointed in the past year, when there were almost 71 vacancies."

Among the 94 companies that were included in both the 2005 and 2006 Census reports, there was a high rate of board turnover during the year ending June 30, 2006.

In particular:


  • A total of 71 new directors joined the boards of 45 (47.9%) of these companies; 58 of those new directors are independent and joined 38 (40.4%) boards.
  • A total of 47 directors retired or resigned from 34 (36.2%) of these boards; 31 of those directors were independent and left 25 (26.6%) boards.
  • As a result, 8.9% of all current directors of the 94 companies were added during this past year, and 9.8% of all current independent directors were newly elected.

The Percentage of New Directors Who Are Women is Low


Unfortunately, few of the 38 companies that added new directors took advantage of the opportunity to elect women to their boards. In particular:


  • Of the 71 new directors, only ten (14.1%) are women.
  • Women comprise only nine of the 58 (15.5%) new independent directors; the tenth new woman director is the CEO of Millennium Pharmaceuticals Inc.
  • Of the 38 companies that added independent directors, only eight (21.1%) elected women. Boston Scientific Corp. and Eaton Vance Corp. each elected two women.
  • Of the 30 companies that added only male independent directors, eight elected two new male directors, three added three men, and one added four men.


On the other side of the coin, the directors who left the boards of these companies during the past year were virtually all male. The 31 independent directors who retired or resigned were men, and only one of the 16 retiring insiders was a woman.

According to co-author Flynn, the fact that the number of women on corporate boards has hit double digits is cause for optimism, especially since there has also been an increase in women among the most highly compensated executive officers of the 100 largest Massachusetts companies.

"The large number of independent directors who have reached the age of 70 or have served more than 15 years on the boards of the 100 companies means that there will likely be many vacancies in the next few years and thus opportunities for significant change," Flynn notes.

In that regard, co-author Wolfman points to the positive examples set this past year by companies such as Avid Technology, Boston Scientific and Eaton Vance.

For example, when it added a fourth woman director, Avid became the first large Massachusetts public company with a board on which women comprise a majority. Boston Scientific also ended the year with four women directors by electing to its board the two women directors of Guidant Corp. upon its acquisition of that company. And Eaton Vance, which previously had an all-male board, elected two women directors over the course of the year. Wolfman hopes other companies in the technology, life sciences and financial services sectors will follow suit and further diversify their own boards.

The 2006 Census concludes that there is cause for "guarded" optimism that there will be "fewer missed opportunities" next year and beyond. For example, the number of women who chair the nominating committees of the 100 Massachusetts companies increased from seven to ten, a second female CEO was elected, and there were again seven women who serve as board chairs or lead/presiding directors.

For a copy of the full report, please click here.

Key Findings:

Women Directors:

  • Women hold 10.8% (91) of the 844 board seats of the 100 largest public companies in Massachusetts, up from 9.9% in 2005, 9.5% in 2004, and 9.0% in 2003.
  • Forty-three of these companies (43.0%) have no women on their boards, down from 45.0% in both 2005 and 2004.
  • Just over one percent (1.1%) of the board seats of these companies is filled by nine women of color, the same percentage as in the last two years.
  • Nineteen companies have at least 20.0% of their board seats filled by women, up from thirteen last year.
  • Since last year's Census, six companies added a woman to their board, and two added two women. One company lost its only woman director.


Firm Size Makes a Difference:

  • Larger companies, on average, have a greater number and a greater percentage of board members who are women than do smaller companies.
  • Eighteen of the 25 companies (72.0%) with revenues over $1 billion have at least one woman director; eight of them (32.0%) have two or more women directors. In contrast, only 17 of the 43 companies (39.5%) with revenues below $500 million have at least one woman director and seven (16.3%) have two or more women directors.
  • All seven Fortune 500 companies in the Census have at least one woman director compared to 89.4% nationally. Massachusetts, however, has lost four Fortune 500 companies through acquisition in recent years.


Industry Also Makes a Difference:

  • The Consumer Goods sector has the highest percentage (12.8%) of women directors, as it did in the past two years. Healthcare Services has the lowest percentage (9.1%), as was the case last year.
  • The largest gains in the past year in the percent of seats filled by women occurred in Life Sciences (from 9.9% to 12.3%), Technology (8.7% to 10.1%), and Retail (from 10.5% to 11.9%) sectors.
  • The Life Sciences sector also led in growth over the past year in the proportion of companies that had one or more women directors, rising from 64.3% to 71.4%. The Financial Services sector followed, increasing to 56.3% from 50.0% in 2005. The Technology sector also showed improvement, going to 54.2% from 48.0% a year ago.


Special Analysis: Board Turnover (Based on the 94 companies that are included in both the 2005 and 2006 Census reports.)

  • Of the 71 new directors appointed this year, 14.1% are women. Fifteen and a half percent (15.5%) of the 58 new independent directors are women.
  • Fourteen of the 46 directors (30.4%) who left boards were 70 years of age or older; all of these directors were male.
  • Almost nine percent (8.9%) of the current directors of these 94 companies were added during the past year.
  • Thirty of the 38 companies (78.9%) that added new independent directors this year, chose to add only male directors.

Women Executive Officers:

  • Women account for 11.0% (78) of the 710 executive officers of the largest public companies in Massachusetts, up from 10.1% in 2005 and 9.2% in both 2004 and 2003.
  • Forty-seven of these companies (47.0%) have no women executive officers, a slight improvement over 48.0% in 2005 and 2004. The comparable figure is 56.0% in 2003.
  • Thirty of these companies (30.0%) have at least one woman among the five most highly compensated executives, up from 28.0% a year ago and 27.0% in 2004.

Directors and Executive Officers:

  • Women comprise 20.0% or more of both the director and executive officer groups in six companies, one more than last year, two fewer than in 2004, and the same as in 2003.
  • Thirty of the companies (30.0%) have no women at either the board level or in their executive officer ranks. Comparable figures in 2005, 2004, and 2003 were 29.0%, 27.0%, and 35.0%, respectively.

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