Key Findings

  • The Conference Board said Tuesday that the proportion of non-white newly appointed directors at Russell 3000 companies is declining, but overall board demographic diversity has reached record levels.
  • According to research released by the Conference Board and co-sponsored by KPMG and Russell Reynolds, the proportion of non-white new directors at Russell 3000 companies fell from 48% in 2022 to 31% in 2024; during the same period, the share of new Black directors dropped from 26% to 12%.
  • "Research repeatedly shows that boards with diverse skills, backgrounds, and demographics are more effective," Annalisa Barrett, senior advisor to the KPMG Board Leadership Center, said in a statement. "Ensuring a diverse talent pipeline is not just about representation; it is also critical to effective board oversight and decision-making."

Regulatory Context and Uncertainty

The U.S. Securities and Exchange Commission (SEC), under the leadership of its Division of Corporation Finance, is considering recommending a rule that would require public companies to disclose more information about the diversity of their board members and nominees. However, since SEC Chair Gary Gensler announced last month that he would step down on January 20 (the inauguration day of President-elect Donald Trump), the prospects for this proposed rule, along with other initiatives aimed at promoting environmental, social, and governance (ESG) best practices, have been called into question.

Trump and Republican lawmakers have criticized the SEC chair's strict regulation for months, including the agency's handling of cryptocurrency companies and its enforcement of securities laws.

Since taking the helm of the SEC in April 2021, Gensler has advocated for robust rulemaking in corporate disclosure, Treasury market audits, and other regulatory areas.

In one of his most criticized moves, Gensler this year pushed the commission to approve a regulation requiring companies to disclose the impact of climate change on their finances, operations, and business strategy. Facing legal challenges and criticism from Republican lawmakers and industry groups, the SEC weakened parts of its original proposed rule and shelved the regulation pending the outcome of litigation.

Under Gensler's leadership, the SEC also adopted rules strengthening cybersecurity risk disclosure. In pushing for stricter regulation, Gensler often cited pressure from institutional and retail investors for greater depth, consistency, and uniformity in transparency regarding various risks and ESG goals.

Overall Diversity Trends

This decade, boards of S&P 500 companies have clearly responded to calls for corporate governance change. The Conference Board said the proportion of non-white directors at S&P 500 companies rose from 20% in 2020 to 26% in 2024; the study was also co-sponsored by ESGAUGE and the University of Delaware's John L. Weinberg Center for Corporate Governance.

During the same period, the share of female directors on S&P 500 boards rose from 27% to 34%, while for Russell 3000 companies it increased from 21% to 29%, the Conference Board said.

"The proportion of female directors is at record levels, and the growing presence of women on boards is expanding the pool of candidates with the expertise, tenure, and relationships needed for leadership roles," Andrew Jones, senior ESG researcher at the Conference Board and co-author of the report, said in a statement.

The Conference Board noted that although women hold about one-third of board seats, they chair only about 10% of corporate boards.