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The Female Fraction: Quest for balance on corporate boards falls short

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Women nationwide are making their voices heard.

More than rallies and protests, Ozarks area residents are taking action through initiatives such as Rosie.

The World War II icon is a sign of female strength, but that force hasn’t found its way into the corporate boardroom.

Springfield Business Journal examined the boards of directors at the area’s six locally-based, publicly traded companies and found women comprise less than a quarter of board leaders.

The divide
Of the 48 combined board seats at Great Southern Bancorp Inc. (Nasdaq: GSBC), Guaranty Federal Bancshares Inc. (Nasdaq: GFED), Jack Henry & Associates Inc. (Nasdaq: JKHY), Leggett & Platt Inc. (NYSE: LEG), Paul Mueller Co. (OTC: MUEL) and O’Reilly Automotive Inc. (Nasdaq: ORLY) just nine are held by women.

That’s 19 percent, which is higher than the national average – but just barely. According to a recent study by corporate research firm Equilar, just more than 15 percent of all director seats at publicly traded U.S. companies were held by women as of Dec. 31, 2016.

A stark contrast to other developed nations worldwide which, in recent years, have passed legislation mandating minimums in female representation in the boardroom. Germany was the latest, passing a 2015 bill calling for a 30 percent minimum. It joins other European nations such as Norway, Spain, France and Iceland, which all set a boardroom quota of 40 percent. At varying degrees, Italy, Belgium and the Netherlands also have targets. Just last month, however, Sweden dropped a similar measure, citing not enough support in parliament.

“Diversity builds a strong board,” said Bart Brown, president and CEO of Ozarks Food Harvest.

While still low, women represent a higher margin of board members at many local nonprofits. At Ozarks Food Harvest, its 14-member board has four female directors – that’s 29 percent – including Tamara De Wild, who currently is serving as president.

“We’ve always been committed to diversity in staff and at a board level,” Brown said. “It’s more than about just gender and race, it’s about what they can bring to the table resourcewise.”

Dan Prater, executive director of Drury University’s Center for Nonprofit Leadership, recently completed a study of volunteerism in Springfield. While the study found women volunteer more frequently than men and women hold about 70 percent of top nonprofit spots in paid leadership positions, the study didn’t directly highlight nonprofit boards. However, Prater often works with boards of all sizes through weekly trainings.

“This is not scientific, but I’d estimate the balance to be about 40 percent men, 60 percent women for these smaller organizations,” he said via email. “For groups that are more ‘nurturing’ in focus, such as causes that assist women or children, the ratio of women to men is higher.”

Ozarks Food Harvest would fall into that “nurturing” category. Prater also cites foster care organizations in which he’s observed boards of 75 percent or more women.

Local highs and lows
Of the six public companies tracked, three have more than one woman on their board of directors – and one of those is a recent addition.

On Feb. 6, Great Southern announced the addition of two new board members. Housing Plus LLC principal Debbie Shantz Hart and SMC Packaging Group Chairman and CEO Kevin Ausburn are scheduled to join the board March 1, according to a news release.

“We value diversity of talent, knowledge and experience in our board members, and I am confident that these new members will contribute a wealth of knowledge,” Great Southern President and CEO Joe Turner said in the release.

When asked further about the appointment of Hart, Great Southern spokeswoman Kelly Polonus deferred to Turner’s statement, adding, “We desire each board member to bring their unique business experience, background, education and perspective to help our company achieve its goals.”

Previous to Hart’s appointment, Julie Turner Brown, daughter of bank founder Bill Turner, was the only female on the board.

It’s a family story at O’Reilly Automotive as well. Rosalie O’Reilly Wooten, daughter of co-founder Charles H. “Chub” O’Reilly, is the lone lady on the board.

The Queen City’s other publicly traded bank, Guaranty Bank, currently has an all-male board of eight. Guaranty President and CEO Shaun Burke did not return phone calls for comment.

The highest count before Great Southern’s newest addition, Jack Henry & Associated has three women on it’s board with long-established backgrounds. That background is key, said Ozark Food Harvest’s Brown.

“Our current president is an attorney and having that knowledge on the board is valuable,” he said. “Our president-elect is a doctor and we’ve got bankers, manufacturers and grocers.

Male or female, it takes a village of knowledge to support an organization.”

Why it matters
In a recent guest column for SBJ, Women Connect4Good Inc. President Nancy O’Reilly made a statistical case for women on boards, citing at least six organizations to prove companies perform better with a gender diverse board.

Stats such as:

• Companies with the highest representation of women board directors attained significantly higher financial performance in three important measures: return on equity, 53 percent higher; return on sales, 42 percent higher; and return on invested capital, 66 percent higher.

• Companies had 42 percent better profit margins and 53 percent higher average shareholder returns when one-third of the board members are women.

• Companies in the top quartile for gender diversity are 15 percent more likely to financially outperform their counterparts in the lower quartile.

“Recognizing women’s impact on organizational performance is just the beginning,” wrote O’Reilly. “We need to take it a step further and actually provide opportunities for advancement.”

In comparison, Great Southern Bank recorded $163.1 million in net interest income for the year ended Dec. 31, 2016, a 3.1 percent decline from $168.4 million in 2015. The situation was similar at Guaranty Bank; earnings for the year totaled $5.6 million, which was down 2.2 percent from 2015.

Those opportunities for female advancement may not come easily or quickly. Of the publicly traded companies tracked in the Equilar study, 738 companies still have no women on their boards. That’s down from 798 last year, putting the nation on track for board parity by the end of 2055 at its current pace.

“It’s not something we think about right off the bat because it has become ingrained in our culture,” Brown said.

“Once you make the decision to pursue diversity, it becomes second nature.”


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