From Main Street shops to Wall Street boardrooms, the American business community is becoming increasingly diverse, with an ever-growing focus on inclusion, equality and social responsibility. We see this evolution taking places across every industry – in particular, the rise of women in leadership positions across all sectors of business and the economy.
On August 26th, Americans celebrate Women’s Equality Day, which marks the adoption of our 19th Constitutional Amendment in 1920. The amendment granted the right of all to vote, regardless of sex, a turning point in the fight for gender equality. Since Richard Nixon, every U.S. president has supported the celebration of Women’s Equality Day to honor the strides and achievements by advocates of equality.
In honor of the day, the U.S. Chamber of Commerce reflects on the progress that has been made for equality in the workplace and highlights the rise of women in business leadership.
The rise of women in the Fortune 500
Over the years, the face of business has changed. In 1973, Katharine Graham became the first female CEO of a Fortune 500 company, The Washington Post Company. Nearly a half century later, the rise of women in business is surging, and the focus on inclusivity and diversity in the workplace and business leadership has been rising.
The S&P 500 recently made a record achievement in advancing the status of women. As of July, women now have a seat at every S&P 500 company’s table. This comes just seven years after approximately 12.5% of company boards within the S&P were all male, according to Equilar. Today, women occupy 27% of all S&P 500 board seats, according to ISS Analytics. Navient, an asset management group in Wilmington, Delaware, has the highest percentage of female board members at 58.2%.
This evolution is also occurring in Fortune 500 companies. The latest Fortune 500 list revealed that 33 companies have female CEOs, an all-time high. Considering there were only 24 female CEOs in the Fortune 500 last year, this is a considerable uptick.
The boards at Fortune 500 companies are also seeing shifts to a more diverse leadership. Fifteen years ago, women represented 15.7% of board seats. That number rose to 25.5% in May of this year.
The rise of women-owned small businesses
But perhaps the growth of women in business is most represented in the small business sector.
A 2018 report by the SCORE Association revealed women-owned enterprises grew by 45% (five times faster than the national average) from 2007 to 2016. In fact, the fastest growing subset of startups are those owned and operated by women. Women-owned small businesses made up 39% of the U.S.’s 28 million small businesses in 2018.
Women-led small business owners are increasingly upbeat on the economy, too. Bucking a previous trend, female-owned businesses have closed a persistent gender gap in economic optimism, with 58% now characterizing the economy as in good health, nearly the same as male small business owners (59%), according to the latest MetLife & U.S. Chamber of Commerce Small Business Index. Over the past 15 years, women-owned businesses grew 1.5 times faster than other small business. This growth has a significant impact on job creation for American workers. One recent report found that there are 9.1 million women-owned businesses across the U.S. that employ 7.9 million people. These businesses generate a total of $1.4 trillion in sales, according to the National Association of Women Business Owners.
The importance of diversity and equality in the workplace
The rise of women-owned businesses and women in leadership for some of the largest U.S. companies is representative of a growing focus on equality and diversity in the workplace, which has been shown to help businesses grow by bringing a variety of perspectives to the table.
Deloitte’s latest 2019 Global Human Capital Trends report revealed the need for new competencies required in company leadership, including an understanding of changing demographics and employee expectations. Deloitte polled various CEOs about their most important measure of success in 2019, and the study revealed that the top issue cited was “impact on society, including income equality, diversity, and the environment.”
The U.S. Chamber of Commerce has emphasized the importance of equality, diversity, and inclusion in the workplace. Last year, the U.S. Chamber teamed up with RSM US LLP to produce a special report on social responsibility, diversity and inclusion in middle-market companies. The analysis revealed that 88% of middle market companies are focused on diversity and inclusion, reflecting the importance that middle market business leaders place on corporate social responsibility (CSR).
In addition, the U.S. Chamber earlier this year hosted the 2019 International Women’s Day Forum, which brought together women in leading roles throughout government and industry, including former SBA Administrator Linda McMahon, actress and singer Keke Palmer, among others.
In February, we sent a letter to Congress supporting the Improving Corporate Governance Through Diversity Act of 2019 as well as The Equality Act, which prohibits discrimination in the workplace and in commerce on the basis of sexual orientation or gender identity. Through these initiatives and many more, the U.S. Chamber strives to improve gender equality throughout the U.S. business community.
Women’s Equality Day should serve as a reminder of our success so far and should stand as an inspiration to keep moving forward.