The male-dominated real estate investment trust sector is seeing an uptick in female leadership, as more than half of newly elected directors are women. But despite corporate calls for diversification, the industry has a long way to go.
Of the 94 REIT directors appointed in the spring proxy season, 49 were women, according to a report by Ferguson Partners, a firm specializing in executive and board recruitment. The report revealed the number of female board members in the REIT sector rose 11% from 2017.
Still, the industry has a way to go – only eight of the 192 boards have female chief executives, according to the report, and 32 of these boards are exclusively male. Most REITs have just one or two women on their board.
Despite this, some studies show a correlation between a female presence in the boardroom and strong financial performance over the long term.
Bringing both sexes to the decision-makers' table offers a greater range of skills and more transparency, and even discourages aggressive accounting, according to a report by Wells Fargo Securities. Boards with a greater percentage of female directors outperformed all-male boards, the report stated, achieving a higher average price and greater total returns.
According to The Wall Street Journal, the REIT sector has a real problem on its hands when it comes to advancing women in their workplace:
The real-estate industry for years had a reputation for machismo and inconsistent workplace attitudes, even as other businesses began to admit a greater number of women to their executive ranks and board rooms. Top REIT executives and shareholders used to pay lip service to more female representation with little to show for results.
But perhaps the tide is starting to turn. A number of institutional investors are calling for more gender diversity, according to a WSJ article, with both State Street Global Advisors and BlackRock Inc. saying they would vote against corporate boards that don’t have any female directors.
The Wells Fargo survey indicates female leadership in the REIT space has increased from 8.5% to 15.5% in the past decade, lagging behind the S&P 500 sector, where nearly a quarter of the leadership is female.
Maybe the boy's club behind the REIT industry is responding – slowly – to the need to catch up to the times, but its progress is unimpressive at best.