The giant company has been under fire from shareholders to add more women and racial minorities to its board of directors.
Following complaints from some of its large shareholders, executives at Apple Inc. say they plan to take steps to add diversity in its corporate board of directors, which is largely white and male.
In response to those complaints, Apple said it will add language to its charter to increase the number of women and minority members to the board. The complaints came from shareholders of Trillium Asset Management LLC and the Sustainability Group.
Of the eight members of the company’s board, there is only one woman, Avon chief executive Andrea Jung, with the remaining being white men. Jung is also the only non-white member of the board in Apple’s history as well as just the second woman to serve as a director.
Jonas Kron, Trillium’s director of shareholder advocacy, said that the lack of racial and gender diversity on corporate boards extends far beyond Apple and companies in Silicon Valley. He added that studies have demonstrated that companies perform better financially when they have diversity on their boards of directors.
“This is an issue that’s much broader than Apple,” Kron said, in an interview with BET.com. “I think, particularly for companies with strong brand name, their boards of directors should be reflective of their customers. If you have a narrow group of people on the board of directors, that’s going to be a weakness on the board.”
Other shareholders expressed similar views.
“This is a problem that affects many of the Fortune 500 companies,” said Larisa Ruoff, of the Sustainability Group, in an interview with BET.com.
“We believe that the business case for diversity at the corporate board level is very strong,” she added. “It improves competitiveness and financial performance. The problem is on the demand side. There are plenty of diverse candidates that would be great fits. Companies need to look beyond their traditional pool of candidates.”
Kron said that there had been significant research that companies with at least one woman on the board of directors outperform those with no women.
“But to see the full benefit, you need to see a critical mass of women on the board of directors,” he said.
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(Photo: Justin Sullivan/Getty Images)