Making Inroads

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The retail industry, the women who work in it – and the women who make up the majority of its consumers – appear to have something to celebrate.

Data compiled for STORES by Equilar finds that women are well represented among retail boards of directors. Macy’s, Target, Office Depot and J.C. Penney each have four women on their respective boards; at Macy’s women comprise 40 percent of board seats. Another eight of the 51 public companies analyzed for the study have three female directors.

The data – compiled from an industry subset consisting of public companies on STORES’ 2009 Top 100 Retailers list that filed proxy statements on or before May 12 – is particularly interesting against the backdrop of research published last December by women-in-business trackers Catalyst. It found that women held only 15.2 percent of board seats at Fortune 500 companies – roughly the same results that were reported a year earlier and up slightly from 14.8 percent in 2007.

Given that women account for some 70 percent of retail purchases in traditional stores and about half of online purchases, it shouldn’t come as a huge surprise that retail boards include women at rates greater than those of companies in other sectors of the economy.

“Having board members that reflect the diversity and inclusion of our customers and our organization is very important,” says Jim Sluzewski, senior vice president of corporate communications and external affairs for Macy’s. “Keeping in mind that a majority of our customers and associates are women, it’s important that we have women representing shareholders and guiding the business of the board.”

Nearly half of the companies included in the study have boards that are least 20 percent female, compared with only four that have no women on their boards (and it should be noted that one of those companies, Blockbuster, nominated a woman for election to its board in late May).

The study results don’t surprise Bobbie Lenga, who leads the global consumer sector and the U.S. retail practice for Russell Reynolds Associates. Based in Chicago, Lenga focuses on senior-level searches for clients in retailing, fashion, apparel, manufacturing, consumer durables and luxury goods.

According to Lenga, there is a finite – albeit growing – pool of women able and willing to serve on retail boards of directors and “most of these great women are already ‘boarded up.’
“The retail industry has more women in the C-suite than nearly any other industry and the number of women appointed to boards is on the rise, too, but the two are definitely not growing at the same rate,” she says.

The challenge, from Lenga’s vantage point, is that “top women executives in retail tend to have greater expertise in merchandising or on the product side of the business” while companies seeking potential directors “typically want a sitting CEO or someone with experience that also includes finance or operations.”

Russell Reynolds Associates regularly performs board searches “and in a majority of cases the company says, ‘We need a woman,’” Lenga says. “Many of the same names come up over and over and it’s difficult for anyone to serve on more than three boards. Two is usually the max.”

Several women already serve on multiple boards: Janice Page, one-time senior vice president of Sears Roebuck & Company, currently serves on five boards, including American Eagle Outfitters, Kellwood Company and RG Barry Corp. Verna Gibson, the first woman to be named CEO of a Fortune 500 company, has served on numerous boards, including Petrie Retail, Mothers Work, Caldor Corp. and Today’s Man since retiring from The Limited in 1991. She currently serves as independent director and chairman of the merchant committee for Chico’s FAS.

Another thinly stretched female exec is Carol Tome, CFO and executive vice president of corporate services for The Home Depot. Tome has served on the UPS board since 2003 and chairs the organization’s audit committee. In addition, she shares her expertise with the board of the Federal Reserve Bank of Atlanta and is a director at the Metropolitan Atlanta Arts Fund and the Atlanta Botanical Gardens.

Is there a quantifiable benefit to having women on boards of directors? It’s hard to say, and likely harder to prove. Catalyst finds that, on average, companies with three or more female directors significantly outperform the boards with the fewest women. Still, it remains tricky to unequivocally link women’s involvement on a board to corporate success.