BOSTON–(BUSINESS WIRE)–#GenderIPO–A study of 177 biotechnology companies which publicly listed between
2012-2015 shows that women participate on biotech company boards at a
current level of 10.9 percent, and to reach gender parity would take 40
years. In 2016, a total 57.2 percent of companies in the study have at
least one woman board director, representing an increase over previous
studies of the biotech sector, the report notes. Liftstream, the
executive search firm who compiled the report, analyzed the gender
diversity in the boardrooms of the companies to assess how they take
advantage of going public to reconstitute their boards and introduce
greater levels of gender diversity.
“This new study of the gender diversity on biotech company boards
provides multi-year data on the sector’s progress and brings forward new
insights. Our discovery of the link between the corporate governance
structure and more diverse boards is an important finding, as is the
evidence linking diverse boards to better financial returns.” said Karl
Simpson, CEO of Liftstream. “It also illustrates the cultural
transformation required in many biotech boardrooms to bring about a
fully diverse and inclusive board. After all, it is the board which sets
the cultural tone and standards for the entire company.”
Abbie Celniker, Partner at Third Rock Ventures said: “This study by
Liftstream confirms the gender diversity problem and highlights the need
for active and intentionally disruptive approaches for appointing
directors to biotech boards. Venture capital firms and company directors
must plan more effectively to increase their opportunity for recruiting
directors from outside their customary networks when meeting the
changing needs of the company.”
Liftstream collected data from the securities and exchange commission
S-1 filings and proxy statements (Form DEF 14A) issued between 2012 and
2016 for 177 public biotech companies listed in the United States. The
study looks at a cumulative peak of 1297 company directors, including
executive, non-executive and VC directors. The report, A Public Reality
for Women in Biotech Boardrooms, tracks the number of directors who
leave the company’s boards, and those who are newly appointed, providing
insight to the boards’ behaviors when appointing directors post-IPO. The
results from the analysis is published in a 41-page report.
Wende Hutton, General Partner at Canaan Partners commented: “The
Liftstream report shines yet another light on the critical business case
for diverse boards in biotech. With these well-researched financial and
performance benefits, our industry has no excuse for continuing to lag
on gender diversity in biotech boardrooms. We must embrace recruiting
women from the entire C-Suite – and not just from the pool of CEOs, of
which only 7% are women. I’ve worked with tremendously talented CMOs,
Heads of R&D, Heads of Business Development and CFOs in my career. In
order to make a change now, that’s where we need to look to recruit
diverse boards and improve bottom lines.”
Key findings from the study are:
Women added to many company boards after IPO but companies have not
sustained their board diversity.
- Women chair the board of directors in less than 2% of companies.
- Less than 8% of companies were found to have a woman CEO.
- Company boards have just 4% of women VCs as directors.
- Cumulatively women occupied 10.9% of board positions in 2016.
- The number of company boards with a woman director increased to 57.2%.
- Companies with separate Chairperson and CEO have more diverse boards.
- Men are appointed to boards at twice the rate of women.
VC directors replaced by non-executive directors improved board
Post-IPO share performance of diverse boards shows a 28 percent net
gain over companies with all-male boards.
To reach 30% participation of women on boards would take 20 years, and
parity 40 years.
Karl Simpson commented: “I am exceptionally proud that Liftstream has
been able to lead on the issue of board diversity in the biotech sector
over the past few years. Our view that diverse company boards are better
business and offer greater economic potential is supported by this new
research. As we continue to engage leaders from across the life science
sector on board diversity, this new data will be important evidence to
focus that discussion. More importantly, we hope it further highlights
the incentives for gender diversity, thereby encouraging industry
stakeholders to take the required action towards finding interventional
solutions capable of accelerating the pace of change towards equality.”
The study entitled “A Public Reality for Women in Biotech Boardrooms”
can be downloaded free at http://www.liftstream.com/women_biotech_boardrooms.html
Liftstream is an executive search recruitment practice focused
exclusively on board and executive appointments in the global life
sciences sector. Our clients benefit from the advanced sector knowledge
we possess and the exceptional people we’re able to recruit for them
into positions of leadership.
Since 2003, Liftstream has been strengthening company boards, executive
teams and functional management across international bioscience
clusters, improving the leadership and governance standards of our
clients. We achieve this through comprehensive searches and rigorous
candidate assessments to identify and appoint the person most suited to
our clients’ requirement.
Liftstream is committed to equal opportunities, diversity, and
inclusion. For more information about Liftstream, please visit www.liftstream.com.
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