State Street Global Advisors Set to Use its Sway to Put More Women on Boards

The asset manager has a new set of guidelines giving 3,500 public companies about a year to increase diversity on their own.


State Street Global Advisors is calling for companies to include more women on their boards, or be prepared for the $2.4 trillion asset manager to start voting down board director candidates at the proxy level in order to force the issue.

“We are actively engaging with these companies and with our votes,” Lynn Blake, CIO of global equity beta solutions at SSGA, said in an interview Tuesday. SSGA found in a study it conducted that 35 percent of public companies in the U.S. have zero female directors on their boards, compared with 36 percent in U.K. and 45 percent in Australia.

The firm has a new set of guidelines giving 3,500 public companies about a year to increase diversity on their own before SSGA starts influencing their selection of board directors at the proxy level. Blake said the guidelines are prescriptive, as SSGA wants to identify people on the board who are going to be tasked with holding the company accountable on diversity hires. The firm also wants to see transparent investor disclosure that lays out specifically how companies plan to tackle gender diversity over the long term.

“This is similar to what we did around board tenure,” Blake says. “We put forward a specific set of guidelines about what we thought the length of tenure should be on a board and we have seen it drop consistently over several years. We think this is a model that works and we’re prepared to vote against board candidates if we don’t see constructive engagement on this issue as well.”

As a symbol of its push for more women in asset management and corporate boards, SSGA on Tuesday morning installed a statue of a young girl directly across from the Charging Bull statue in New York’s Financial District.

SSGA, which found that when companies do have female board members they amount to just 15 percent or less of total board seats, is getting added firepower from California State Teachers’ Retirement System.


CalSTRS last year provided a $250 million seed investment into SSGA’s SHE exchange-traded fund, an index ETF that is weighted to capture the performance of companies that have gender-diverse management teams. Chris Ailman, chief investment officer at CalSTRS, said that he wants to use the SHE ETF to show that there is money to be made when a more diverse group of decision-makers are leading companies. CalSTRS also supports SSGA’s guidelines and plans to vote its proxies aggressively.

“It’s time to move beyond talk,” Ailman said in an interview. “We have made a concerted effort on diversity within our organization, we have a 50/50 gender split now and we expect to see the same from the companies we invest in.”

Ailman has also indicated he’s willing to make diversity a high-profile issue for companies that lag behind on inclusion. “We will publicly shame companies if we need to. We did it with Facebook when they went public and had no female board members and we will do it again,” he said.