New research released Thursday by executive search and leadership consulting firm Epsen Fuller Group shows men continue to go from strength-to-strength in biopharma and medical device boardrooms.
Based on a survey of 423 publicly-held U.S. life Science companies, the authors determined that a whopping 87 percent of the C-suite executives were male. And that dominance extends into the boardroom, with almost nine out of 10 director positions being held by men.
Isn’t that just great?
Obviously not from a gender diversity perspective, which is what the survey and the accompanying visual report are all about. And while it isn’t surprising, it is troubling on a number of fronts. From a purely business standpoint, studies show male-led companies underperform when compared to those with substantial females representation.
“The numbers paint a harsh but clear picture of what is happening in Boards and C-suites today,” said Thomas Fuller, managing partner at Epsen Fuller, in a statement. “What’s worse, this flies in the face of evidence that gender diversity is not a “nice-to-have,” it delivers better results, period.”
Fuller points to a recent Credit Suisse Research Institute study, which found that companies with a senior management team at least 15 percent female had more than 50 percent higher profitability than companies that had women in less than 10 percent of the top jobs.
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Shouldn’t that be enough of an incentive?
“I think it should be, and we employ the data with companies we’re in conversation with every day about board placements,” said Michael Rice, a founding partner of LifeSci Advisors and two new industry mentorship programs for women. “People tend to hire who they know because it’s easier, but having diverse perspectives is good for your team and your bottom line. Different viewpoints can challenge the group and make it better.”
Source: “Life Science Diversity Still Lagging” visual report, Epsen Fuller Group 2017
Unfortunately, there’s a long way to go to change the culture. Via email, Fuller said it’s important to ‘shine the light’ on the lack of diversity — which is exactly what his firm’s latest survey and visual report do.
A breakdown of the findings show large cap companies (with valuations greater than $10 billion) are doing better on the diversity front. Two out of 10 of their directors are female. At the opposite end of the spectrum, microcap companies (worth between $50-300 million) had a meager 8.3 percent female director base.
Industry-wise, the results were fairly consistent, with medical device companies faring slightly worse than pharma and biotech.
The ratios were similar when it came to the C-suite team, though microcaps showed greater diversity than their large-cap counterparts.
Source: “Life Science Diversity Still Lagging” visual report, Epsen Fuller Group 2017
To begin changing the culture, Fuller recommends companies check out some examples of proactive leadership in this space, such as Biogen’s ‘Raise the Bar” program.
“They are actively looking for women executives within their ranks to go through a formal, one-year board governance education program, making these senior female exec’s “board-ready” and then working with firms such as ours to get them placed,” Fuller explained.
LifeSci Advisors has been working on its own board placement program for women in the life sciences for close to a year.
“In our experience, we’ve had mostly positive feedback from colleagues and companies about our gender diversity work and addressing the issue overall,” Rice said. “But there’s a difference between dialogue and action, and that’s the toughest part. Men and women have to start working together, casting the net wider when we’re looking for new hires and helping women make those connections. Talking about the problem and raising awareness is crucial, but companies need to take action, even in small ways.”
And at the end of the day, Fuller and Rice both agree that the most direct path is for life science companies to demand a diverse slate of candidates when they go to fill a top position.
“CEOs and Boards MUST make this issue a priority,” Fuller said. “As research shows, companies with diversity at the top fare better in overall return. If CEOs and Boards make it a priority, strong female candidates can be found. It is up to the CEOs and Boards to push for diverse candidates, and work with search firms with a strong track record in doing so.”
Photo: LoveTheWind, Getty Images
