April 08, 2015

Women’s Economic Power is Key Determinant of Women Reaching and Staying on Boards – New Global Study Reveals

Landmark global study unveils the factors driving and limiting women’s rise to the top

LONDON, APRIL 8, 2015 – Boosting the economic power of all women in society is a key determinant of women reaching and staying on corporate boards, according to a new global study released today. Economic power is defined by factors outside the boardroom including women’s expected years of education and participation in the labour force, and have the greatest impact on getting women into the boardroom.

The top performing countries for female economic power are Australia, Norway and Denmark while Saudi Arabia, India and United Arab Emirates are amongst the lowest (see table below).

Other findings revealed that a country’s collective values and beliefs about gender egalitarianism, humane orientation and assertiveness are bigger influencers than were previously understood. Quotas can help to get women into the boardroom but have no significant impact on keeping them there.

These are the key findings from a landmark global study looking at whether economic, cultural, political and legislative factors influence women’s representation and longevity on corporate boards.

The research looked at 1,002 companies from the Forbes Global 2000 list across 41 countries spanning six continents and 51 industries over a ten-year period. It was headed by Professor Sucheta Nadkarni from the University of Cambridge Judge Business School and commissioned by BNY Mellon and Newton Investment Management.

“We are proud to be associated with a study which looks at the drivers and impediments influencing women’s rise and longevity in senior positions. This research marks a step change in current thinking around quotas and highlights the importance of empowering and supporting women at all stages of their careers,” said Curtis Arledge, Vice Chairman of BNY Mellon and CEO BNY Mellon Investment Management.

"I'm delighted to see confirmation that empowering women outside the boardroom is key to getting women into the boardroom and keeping them there – potentially becoming a virtuous circle,” said Helena Morrissey, CEO of Newton Investment Management.

To a lesser extent but still significant are the quality and availability of maternity and paternity benefits, flexible hours and the right to return to work which all contribute to effective maternity provision, another key driver for both getting women on board and keeping them there.

In examining the effect of national cultural dimensions in different countries some of these factors, such as gender egalitarianism and humane orientation, have a strong effect on female board representation, but little effect on the longevity of female board tenure. Others, such as a culture recognising and rewarding assertiveness or aggressive behaviour hinder female board recruitment but conversely increase the longevity of tenure for those who make it in the first place.

“There is a clear effect of national cultural traits on female board membership in countries around the world,” explained Professor Sucheta Nadkarni, lead author of the study and Sinyi Professor of Chinese Management at the University of Cambridge Judge Business School.

“In nations with an assertive business culture such as Germany and Greece, fewer women get to the corporate boardrooms, but those who get there are able to stay longer. The issue of longevity of female board members needs to be examined further to determine whether it means success, tokenism, powerful networking or capability. This research opens a host of questions on this issue.”

While the cultural picture varies globally, it is not a straightforward split between developed and developing countries. For example, gender egalitarianism has had a significant impact on increasing female board representation in Scandinavian and other European countries including France and the Netherlands. In contrast, in countries low on gender equality such as Germany, China, South Korea or Qatar, female board numbers remain low.

Likewise, countries that culturally value nurturing and humane orientation such as Sweden and Finland see a greater number of women on boards than countries such as Germany, Greece and the UK which do not replicate these values.

The findings were unveiled at a conference on Womenomics hosted today in London and can be found at http://womenomics.co.uk/ and http://www.womenomicstoday.com

Saturday April 11th 2015 marks a breakthrough for gender equality when the 161st men’s Boat Race between the universities of Oxford and Cambridge will be joined by the 70th Women’s Boat Race. This is the first time in its 88 year history that the women’s race will be held over the same Tideway section of the Thames river, on the same day as the men, and with equal television rights and funding. BNY Mellon sponsors the Men’s Boat Race and Newton Investment Management sponsors the Women’s Boat Race. http://theboatraces.org/

(Below source: World Bank, University of Cambridge Judge Business School)

Ranking Country Composite female economic power (average score of expected years of female education and female % labour force participation: 2004 - 2013

above the mean
(mean = 0)

1 Australia 1.285596
2 Norway 0.9974202
3 Denmark 0.9379257
4 Finland 0.9023951
5 Ireland 0.7567956
6 USA 0.6276978
7 Sweden 0.6108906
8 Netherlands 0.5939252
9 United Kingdom 0.5601892
10 France 0.4866339

below the mean
(mean = 0)

32 China -0.7123861
33 Malaysia -0.9443877
34 Mexico -1.037276
35 Indonesia -1.156699
36 Philippines -1.164189
37 Turkey -1.699219
38 Saudi Arabia -2.163783
39 India -2.209851
40 United Arab Emirates -2.255054
41 Qatar -2.29157



Notes to editors:

BNY Mellon Investment Management is one of the world's leading investment management organisations and one of the top U.S. wealth managers, with $1.7 trillion in assets under management. It encompasses BNY Mellon’s affiliated investment management firms, wealth management services and global distribution companies. More information can be found at www.bnymellon.com.

BNY Mellon is a global investments company dedicated to helping its clients manage and service their financial assets throughout the investment lifecycle. Whether providing financial services for institutions, corporations or individual investors, BNY Mellon delivers informed investment management and investment services in 35 countries and more than 100 markets. As of Dec. 31, 2014, BNY Mellon had $28.5 trillion in assets under custody and/or administration, and $1.7 trillion in assets under management. BNY Mellon can act as a single point of contact for clients looking to create, trade, hold, manage, service, distribute or restructure investments. BNY Mellon is the corporate brand of The Bank of New York Mellon Corporation (NYSE: BK). Additional information is available on www.bnymellon.com, or follow us on Twitter @BNYMellon @BNYMWomenomics #ChangingHistory

Newton is a London-based global investment management subsidiary of The Bank of New York Mellon Corporation. With assets under management of £51.2 billion (as at 31 December 2014), including assets managed by Newton Investment Management Limited as dual officers of Newton Capital Management Limited and The Bank of New York Mellon, Newton's group of affiliated companies provides investment products and services to a wide range of clients, including pension funds, charities, corporations and (via BNY Mellon) individuals. News and other information about Newton is available at www.newton.co.uk and via Twitter: @NewtonIM

Cambridge Judge Business School leverages the power of academia for real world impact to transform individuals, organisations and society. Since 1990, Cambridge Judge has forged a reputation as a centre of rigorous thinking and high-impact transformative education, situated within one of the world's most prestigious research universities, and in the heart of the Cambridge Cluster, the most successful technology entrepreneurship cluster in Europe. The School works with every student and partner or client organisation at a deep level, identifying important problems and questions, challenging and coaching people to find answers, and creating new knowledge. www.jbs.cam.ac.uk/

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Asmita Kapadia
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Lauren Stewart
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