On the Eve of International Women’s Day, SSGA Issues Guidelines and Places Statue in New York City’s Financial District as a Symbol of Need for Action
On the eve of International Women’s Day and the one-year anniversary of
its SPDR®SSGA Gender Diversity Index ETF (ticker: SHE), State Street
Global Advisors (SSGA), the asset management business of State Street
Corporation (NYSE: STT) is calling on the more than 3,500 companies that
SSGA invests on behalf of clients, representing more than $30 trillion
in market capitalization1 to take intentional steps to
increase the number of women on their corporate boards.
To mark this effort and the power of women in leadership, SSGA has
placed a statue of a young girl, representing the future, in the center
of the world’s financial capital – right near Wall Street in New York
City.
“We believe good corporate governance is a function of strong, effective
and independent board leadership," said Ron O’Hanley, president and
chief executive officer of SSGA. “A key contributor to effective
independent board leadership is diversity of thought, which requires
directors with different skills, backgrounds and expertise. 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.”
This morning O’Hanley will detail the guidance in his keynote speech at
the Corporate Governance Symposium hosted by the University of
Delaware’s Weinberg Center for Corporate Governance. The focus of this
year’s symposium is “Governance Issues of Critical Importance to Boards
and Investors in 2017.”
According to an MSCI study, companies with strong female leadership
generated a return on equity of 10.1 percent per year versus 7.4 percent
for those without a critical mass of women at the top, which is a 36.4
percent increase of average return on equity. 2,3 And,
according to a 2015 McKinsey Global Institute report, moving to a
scenario where women participate in the economy identically to men would
add up to $28 trillion, or an additional 26 percent, to annual global
GDP by 2025 compared to a business as usual scenario.4
Despite this, although there has been some progress made on the
inclusion of women on corporate boards, one out of every four Russell
3000 companies do not have even one woman on their board, and nearly 60
percent have fewer than 15 percent of their boards comprising women
directors.
SSGA today issues guidelines to drive greater board gender diversity
through active dialogue and engagement with company and board
leadership. In the event that a company fails to take action to increase
the number of women on its board, SSGA will use proxy voting power to
influence change - voting against the chair of the board’s nominating
and/or governance committee if necessary.
“As part of our review of boards’ gender diversity, we analyzed and
compared the level of diversity in three markets: Australia, the UK and
the US,” said Rakhi Kumar, head of corporate governance at SSGA. “Most
large cap company boards in these markets have at least one female
director but have yet to fully embrace gender equality in their ranks.
We believe boards have an important role to play in increasing gender
diversity and believe our guidance can help directors take action now.”
"I wholeheartedly support State Street's efforts," said Chris Ailman,
Chief Investment Officer, CalSTRS. "Companies need to step up and better
utilize the talents and leadership of women in their Corporate Boards,
C-suite and throughout their ranks. This statue boldly signals to
financial markets that the future depends on investing in the power of
women. We all need to lean in and be bold for change now."
To help address the gender gap head-on, SHE incorporates an innovative
charitable component that focuses on strengthening the next generation
of women leaders - particularly in industries where women have low
representation today such as STEM (Science, Technology, Engineering and
Math). SSGA is directing a portion of their revenues and a match from
SSGA to a Donor Advised Fund, which has awarded a $50,000 grant to Girls
Who Invest, a nonprofit organization founded in April 2015 dedicated to
increasing the number of women in portfolio management and executive
leadership in the asset management industry.
About State Street Global Advisors
For nearly four decades, State Street Global Advisors has been committed
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With trillions* in assets under management, our scale and global
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State Street Global Advisors is the investment management arm of State
Street Corporation.
*Assets under management were $2.47 trillion as of December 31, 2016.
AUM reflects approx. $30.62 billion (as of December 31, 2016) with
respect to which State Street Global Markets, LLC (SSGM) serves as
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1 As of 2/28/17
2 The methodology used in MSCI’s study is different than that
of the index, and as such, the results of the study should not be viewed
as indicative of future performance of the index or SHE. Return on
equity is not representative of the performance of any investment or the
potential return of any ETF.
3 Source: Lee, Linda Eling, et al. Women on Boards: Global
Trends in Gender Diversity on Corporate Boards, MSCI, November 2015.
Accessed on February 17, 2016. MSCI defined strong female leadership as
having a board of directors with at least three women, which research
suggests comprises a critical mass for decision making influence, or a
percentage of women that’s higher than average in the company’s country.
MSCI defined companies without a critical mass of women at the top as
companies with less than three women on their board of directors or a
lower percentage of women than the average in the company’s country.
4 Woetzel, Johnathan. “The Power of Parity: How Advancing
Women’s Equality can Add $12 Trillion to Global Growth.” McKinsey Global
Institute, September 2015
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