Study: Women making leadership progress, but more work is necessary

Listen to this article

Public companies in New Jersey are doing a better job at ensuring women are more represented in the boardroom and in top leadership positions, but a new report found less progress when it comes to increasing racial and ethnic diversity.

As of 2023, women held 29% of board seats, a 15% increase from a decade ago, while the percentage of companies in the Garden State with no female board members dropped from 30% to a mere 3%, according to Executive Women of New Jersey’s “A Seat at the Table: A Decade of Perseverance and Progress.”

In its sixth biennial study, the organization examined gender diversity statistics related to the boards of publicly held New Jersey companies in the Russell 3000 and reviewed data on women in executive-level positions and how their compensation compares to male counterparts.

A copy of the findings can be viewed online here.

EWNJ President Courtney McCormick described the latest report as “a celebration” of the dedication that the organization “has poured into advancing women’s leadership representation over the last 10 years.”

Founded in 1980, EWNJ is leading the charge in ensuring women have equal access to leadership positions at New Jersey corporations. As part of that mission, the organization hosts an array of events designed to offer women executives networking opportunities and raise money for its Graduate Merit Award Program, an initiative focused on creating a pipeline of women leaders.

Additionally, EWNJ has published a biennial report since 2013 in which it tracks and documents progress to close the gender gap in corporate governance.

“We believe it’s crucial to pause and appreciate the strides women have taken in top roles, while also reaffirming our commitment to advocating for gender equality in corporate leadership,” said McCormick, who is also a senior vice president of audit, enterprise risk & compliance at PSE&G.

“While we’ve seen significant progress overall, the number of women CEOs remains stagnant, and women of color remain sorely underrepresented in top corporate positions. Mentorship, sponsorship, and encouragement must continue to be prioritized for nurturing leaders and strengthening diversity within corporate cultures. This report proves our measurable impact over the last 10 years, and I remain excited to stay the course,” she stated.

Empowering Women

Earlier this year, NJBIZ recognized more than 50 companies and organizations for their tangible and innovative efforts to advance women in the workplace and community. Click here to see the honorees.

According to the findings – which took nearly a year to collect and analyze – of the 725 board seats at 74 Garden State companies, 209 – or 29% – were held by women, up from 15% a decade ago.

The 13 Fortune 500 companies headquartered in New Jersey fared even better, with 52 of the 142 (37%) seats occupied by women, which is a significant increase from 2013, when only 19% of board seats were filled by women.

In 2023, four companies have either reached – or exceeded – gender parity on boards: Organon & Co. in Jersey City (69% women), American Water Works in Camden (60% women), The Children’s Place in Secaucus (55% women) and Johnson & Johnson in New Brunswick (50% women).

McCormick noted that just 10 years ago “no company could claim this distinction.”

“Today, some of the most recognizable companies in the country are represented in this list. I think it demonstrates that when companies are serious about diversifying their leadership there’s no shortage of qualified women leaders,” she commented.

Additionally, the number of companies with no women on their boards fell from 33 (30%) in 2013 to two (3%) in 2023. Executive level posts are increasingly being held by females, with women accounting for 27% of those roles—up from 16% a decade ago.

Of the 367 top earners, 73 – or 20% – are women in 2023. While far below parity, the report pointed out the representation has doubled since 2013, when women made up only 10%.

However, relatively little has changed at the top, with just six female chief executive officers in 2023, up from four in 2013.

Overall, the changes in New Jersey mirror progress across the country more broadly, as the proportion of women holding board seats at U.S.-based companies and serving as CEOs is on the rise.

For the first time ever, the study delved into the state of diversity in corporate leadership among New Jersey’s top companies, which found “the number of board members from underrepresented racial and ethnic groups are far below parity.”

However, there was some growth in diversity on public company boards across the U.S. in 2021 and 2022, largely due to heightened attention to the issue following the murder of George Floyd.

But companies are beginning to face pushback on social media for diversity initiatives. A recent study by Bloomberg determined corporate executives are now making far fewer public pronouncements of support for diversity than they did four years ago.

So far, few large companies have completely dismantled DEI programs or walked back commitments to diversity, but EWNJ said, “The pressure is building.”

McCormick said, “What stood out to us the most was the remarkable progress New Jersey companies have made this past 10 years in diversifying their leadership … Companies are getting the message, and we’re sure our ‘A Seat at the Table’ report has contributed to this progress. But, there’s still work to be done … which is why we’re excited about the impact our report can have on driving corporate diversity over the next decade.”

Susan Dromsky-Reed, president elect of EWNJ, expressed similar sentiments, saying, “This report shows that while there’s been significant improvement in some areas it remains stagnant in others – such as the number of women CEOs and the continued underrepresentation of women of color in top leadership.

“However, we are encouraged by recent trends with companies taking a more active role in diversifying their leadership ranks,” said Dromsky-Reed, who is also co-chair of the Trusts and Estates Practice at Brach Eichler LLC.

While EWNJ is optimistic about the past decade’s progress, the organization is also stressing the need to continue to not only sustain but build on these gains. That’s why the Seat at The Table report includes a list of recommendations for companies seeking to diversify their boards and for those who aspire to be members of corporate boards.

“The common theme running through many of these changes is a drive toward transparency and accountability. Large institutional investors drew public attention to companies with too few women on their boards. A political movement highlighted the lack of racial diversity. And organizations like EWNJ have been monitoring and reporting on that progress for a decade. In the process, many businesses have recognized the link between transparency and their bottom line. The business case for diversity is now well-established,” the report said.

“Over the decade, many have been repeated, e.g., encouraging companies to look beyond the narrow pool of retired CEOs, to use skill inventories in board search, to be intentional about their commitment to diversity, to create goals and hold people accountable. We have advised potential candidates to network with people already on boards, and we have urged women already on boards to help other women succeed,” the report said. “We have also urged women to expand their networks and to seek out new skills.”

To coincide with the Oct. 26 release of its report, EWNJ also highlighted 17 companies with 35% or more women in top leadership roles. The “A Seat at the Table Honor Roll” list was recognized during an awards breakfast and networking event that morning: ADP, AdvanSix, American Water, The Children’s Place, CompoSecure, Essential Properties REIT, Johnson & Johnson, Merck & Co., Organon & Co., PMV Pharmaceuticals, Prudential Financial, PSE&G, PTC Therapeutics, Quest Diagnostics, Universal Display Corp., Verisk Analytics and Zoetis.

Dromsky-Reed believes the growing number of companies that seek to be honored for their efforts to prioritize diversity is a testament to the impact of the report. “With each report since 2013, we highlighted companies with three or more women on their boards of directors and honored them at our celebration breakfast. In 2013, the Honor Roll represented 15% of the New Jersey based public companies. In 2023, the number of New Jersey based public companies with three or more women on their boards is 58% of the New Jersey based public companies,” she explained.

“Because of this measurable success, for our 2023 report, we wanted to honor the legacy of the report while also reaffirming our commitment toward gender parity by raising the bar to recognize those companies with 35% or more women on their boards. It’s clear our report has been an important voice for women’s leadership, and we plan to continue to challenge companies toward move toward gender and racial parity,” Dromsky-Reed said.