Last week, Liz blogged about a recent report from the NYSE & Diligent that said that 81% of directors indicated that their board either already has a plan for increasing boardroom diversity or will have one soon, but that 45% lacked a specific timeframe for meeting diversity goals. However, the report goes on to say that those companies that have established a timeframe plan to move fast, and are limiting the number of boards on which directors may serve to help them achieve their diversity goals. Here’s an excerpt from this CorporateSecretary.com article:
But when a timeframe is set, it is ambitious: 35% of companies have set a one to three-year period in which to meet their diversity goals. The most widely adopted approach companies are taking to promote board refreshment is limiting the number of boards a director can sit on (17%). This brings a new focus on the concept of overboarding – a growing issue for investors in recent years. Although the Diligent and NYSE study doesn’t provide numbers when talking about limiting the number of boards a director can sit on, both ISS and Glass Lewis have tightened their stance on this in recent years.
The report says that 14% of companies have also introduced age limits for their directors in order to promote board refreshment and greater diversity. Another 11% percent have added more seats to their boards in order to make room for more diverse directors to join.
-John Jenkins, TheCorporateCounsel.net November 11, 2020