SENATE DOCKET, NO. 1048        FILED ON: 1/15/2015

SENATE  .  .  .  .  .  .  .  .  .  .  .  .  .  .  No. 1007

The Commonwealth of Massachusetts

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PRESENTED BY:

Karen E. Spilka

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To the Honorable Senate and House of Representatives of the Commonwealth of Massachusetts in General
Court assembled:

The undersigned legislators and/or citizens respectfully petition for the adoption of the accompanying resolution:

Resolutions encouraging equitable and diverse gender representation on the boards of companies in the commonwealth.

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PETITION OF:

SENATE DOCKET, NO. 1048        FILED ON: 1/15/2015

SENATE  .  .  .  .  .  .  .  .  .  .  .  .  .  .  No. 1007

The Commonwealth of Massachusetts

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In the One Hundred and Eighty-Ninth General Court
(2015-2016)

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Resolutions encouraging equitable and diverse gender representation on the boards of companies in the commonwealth.

Whereas, equitable and diverse gender representation in the leadership ranks of Massachusetts companies is essential to enhance the Commonwealth’s competitive position in the global economy; and

Whereas, women make up 48% of the labor force in Massachusetts and 46.9% of the labor force nationally; women in the U.S. earned 57.3% of bachelor’s degrees, 59.9% of masters degrees, 51.4% of doctorate degrees, and 36.8% of MBA’s in 2010-2011; and women make up 59% of college-educated entry-level workforce, 52% of all professional-level jobs, 14% of executive officers, and 8.1% of top earners (2014); and

Whereas, the Boston Club's 2014 Census of Women Directors and Executive Officers of Massachusetts Public Companies reports that as of June 2014, women hold 14.9% of the board seats and 11.8% of executive officer positions in the 100 largest public companies in Massachusetts. Twenty-four of these 100 companies have no women on their boards of directors; 46 have no women executive officers; and 19 have no women on their boards of directors or in their executive suites; and

Whereas, the 2014 Credit Suisse Gender 3000 report confirmed, after analyzing over 3,000 companies across the world, that greater gender diversity on boards of directors and in management “are empirically associated with higher returns on equity, higher price/book valuations and superior stock price performance.”  In addition, the authors “find no evidence that female led companies reflect greater financial conservatism where leverage is concerned [and] dividend payout ratios have been shown to be higher.”; and

Whereas, reports issued by Thomson Reuters (2013), Credit Suisse (2012) and McKinsey (2007, 2010, 2013), have substantiated the correlation between greater gender diversity in top management and enhanced corporate performance; and

Whereas, according to the McKinsey Quarterly article “Can Women Fix Capitalism?” the case for women in leadership positions is strong, noting that “women bring improved decision making at the top, more creativity and innovation, and better problem solving, stemming from greater cognitive diversity. Women also improve the ecosystem, because company leaders better match the profile of customers and employees. And when three or more women make it to the top team, a company’s organizational health appears to improve on every one of the nine dimensions McKinsey tracks”; and

Whereas, in countries that require reporting on gender diversity policies for regulated companies, disclosure requirements have led to progress toward gender and diversity goals in executive positions and on boards of directors; therefore be it

Resolved, that the Legislature encourages equitable and diverse gender representation in the public and private leadership ranks of Massachusetts companies and state government; and be it further

Resolved, that all companies doing business in Massachusetts, privately held as well as publicly traded, should adopt policies and practices designed to increase the gender diversity in their boards of directors and senior management groups and set goals by which to measure their progress; and be it further

Resolved, that all companies in Massachusetts, privately held as well as publicly traded, should publicly disclose the number of women and total number of individuals on their boards of directors; and be it further

Resolved, that by December 31, 2018, all corporate boards with nine or more members should have a minimum of three women directors; all boards with fewer than nine members should have a minimum of two women directors; and all companies, privately held as well as publicly traded, should measure their progress toward a goal of equal representation of men and women in leadership positions on an annual basis.