Women On Boards – Jennifer Jordan – I by IMD – imd.org

Report on Gender Equality in Corporate Leadership and Alignment with Sustainable Development Goals

Executive Summary: Advancing SDG 5 in Corporate Governance

This report analyzes the persistent gender disparity in senior corporate leadership roles, framing the issue within the context of the United Nations Sustainable Development Goals (SDGs). While female representation on corporate boards is increasing, progress toward gender equality in key decision-making positions remains stagnant. Achieving full female participation in economic life is a direct objective of SDG 5 (Gender Equality), particularly Target 5.5, which calls for equal opportunities for leadership. Furthermore, addressing these disparities is critical for fostering inclusive economic growth as outlined in SDG 8 (Decent Work and Economic Growth) and reducing systemic inequalities as mandated by SDG 10 (Reduced Inequalities).

Analysis of Current Representation Disparities

Data indicates a significant gap between female presence on boards and their occupation of influential executive roles. This imbalance undermines the principles of inclusive and effective institutions central to SDG 16 (Peace, Justice and Strong Institutions).

• United States: According to the MSCI Women on Boards and Beyond 2024 Report, women hold 27.3% of board seats in large and mid-cap companies. However, top executive roles, such as CEO and Chair, remain predominantly held by men, with female representation in these positions declining.
• Europe: Women occupy 20% of executive seats, yet only 8% of CEOs are female. This highlights a critical bottleneck preventing women from advancing to the highest echelons of corporate leadership.

Systemic Barriers to Leadership and SDG Attainment

Several systemic and cultural barriers hinder progress towards achieving gender parity in leadership, directly impacting the fulfillment of SDGs 5, 8, and 10.

• Unequal Promotion Pathways: Evidence suggests men are promoted more rapidly and are required to provide less proof of their capabilities, while women are often expected to demonstrate exceptional performance consistently.
• Lack of a Strategic Talent Pipeline: Organizations often fail to implement long-term, continuous succession planning that identifies and nurtures high-potential female talent from early in their careers.
• Cultural Deficiencies: A non-inclusive workplace culture is a primary driver of low attraction and retention rates for female talent, impeding the creation of diverse and innovative environments essential for sustainable economic growth (SDG 8).

Strategic Recommendations for Corporate Action

To align corporate practices with global sustainability targets, organizations must adopt a deliberate and strategic approach to gender equality. The following actions are recommended to build strong, inclusive institutions and advance the SDGs:

1. Develop a Proactive Talent Pipeline: Implement robust, long-term succession planning that begins on an employee’s first day. This involves identifying high-potential women deep within the organization and creating pathways for them to bypass traditional hierarchical constraints where appropriate. This directly supports SDG 5.5.
2. Cultivate an Inclusive Culture: Foster a workplace environment that values engagement, creativity, and learning from mistakes. An inclusive culture is the most significant factor in attracting and retaining female talent, contributing to the goal of full and productive employment for all under SDG 8.5.
3. Promote Equitable Leadership Models: Normalize diverse leadership styles and move away from the expectation that female leaders must be flawless in all areas. Empowering women to be authentic and assertive, including the ability to refuse requests without negative repercussions, is crucial for true equality.
4. Engage Male Allies: Actively involve male leaders in championing gender equality initiatives. Building a broad coalition of support is essential for dismantling systemic barriers and accelerating progress toward SDG 5 and SDG 10.

1. Which SDGs are addressed or connected to the issues highlighted in the article?

SDG 5: Gender Equality

• The article’s central theme is the underrepresentation of women in corporate leadership and decision-making roles. It directly addresses the need to achieve gender equality by discussing the disparity between men and women in positions like CEO, chair, and executive director. The text highlights that while overall board representation is rising, “men still largely occupy top executive roles, with female representation declining among these positions.”

SDG 8: Decent Work and Economic Growth

• The article connects to this goal by advocating for inclusive workplaces and equal opportunities for promotion and career advancement. It discusses the importance of creating a “pipeline of female talent” and fostering an “inclusive workplace that fosters engagement and creativity.” This promotes the principles of full, productive employment and decent work for all, as the article points out that “Men are promoted faster and made to prove their worth less.”

SDG 10: Reduced Inequalities

• This goal is relevant as the article focuses on reducing the inequality of opportunity between men and women within the corporate world. The disparity in leadership roles is a clear example of economic inequality. The article calls for organizations to “distribute wildcards to the greatest talent in your organization, allowing women to jump over the hierarchy where appropriate,” which is a direct strategy to reduce this form of inequality.

2. What specific targets under those SDGs can be identified based on the article’s content?

SDG 5: Gender Equality

1. Target 5.5: Ensure women’s full and effective participation and equal opportunities for leadership at all levels of decision-making in political, economic and public life.
• The article is entirely focused on this target. It explicitly laments the stagnant “number of women in key decision-making roles such as chair, executive director, or senior independent director” and points out that in Europe, “just 8% of CEOs are female.” The call to “create a pipeline of female talent” is a direct effort to achieve this target.

SDG 8: Decent Work and Economic Growth

1. Target 8.5: By 2030, achieve full and productive employment and decent work for all women and men… and equal pay for work of equal value.
• While not mentioning pay, the article addresses the “decent work” and “full and productive employment” aspects by highlighting unequal promotion opportunities. The statement “Men are promoted faster and made to prove their worth less” points to a system that does not provide equal opportunities for productive employment for women. The emphasis on creating an “inclusive workplace” and the need to “attracting and retaining women” directly supports the goal of decent work for all.

SDG 10: Reduced Inequalities

1. Target 10.2: By 2030, empower and promote the social, economic and political inclusion of all, irrespective of… sex…
• The article advocates for the economic inclusion of women at the highest corporate levels. The core argument is to move beyond simple board representation to ensure women are included in top executive and decision-making roles. The call for organizations to “think about their talent pipeline… thoughtfully in a long-term and continuous way” is a strategy to promote the economic inclusion of women.

3. Are there any indicators mentioned or implied in the article that can be used to measure progress towards the identified targets?

SDG 5: Gender Equality (Target 5.5)

• Indicator (mentioned): Proportion of women in managerial/leadership positions. The article provides specific statistics that serve as direct indicators:
  • “women occupy 27.3% of board seats at large and mid-cap companies in the US”
  • “In Europe, 20% of executive seats are held by women”
  • “just 8% of CEOs are female”
• Indicator (implied): Proportion of women in key board roles (Chair, Executive Director). The article states that the number of women in these specific roles “seems to be stagnant,” implying this is a key metric to track.

SDG 8: Decent Work and Economic Growth (Target 8.5)

• Indicator (implied): Rate of promotion by gender. The observation that “Men are promoted faster” implies that tracking promotion rates for men versus women would be a key indicator of progress towards equal opportunity.
• Indicator (implied): Female employee retention rates. The article stresses the need to “attracting and retaining women” and notes there is a “war for female talent,” suggesting that retention rates for women, especially in leadership tracks, are a crucial measure of an inclusive and decent work environment.

SDG 10: Reduced Inequalities (Target 10.2)

• Indicator (implied): Proportion of women in high-potential talent development programs. The recommendation to “Identify your high-potential talent, go deep down, and distribute wildcards” suggests that measuring the representation of women in these talent pipelines is an indicator of an organization’s commitment to promoting their economic inclusion.

4. Table of SDGs, Targets, and Indicators

Source: imd.org