LEGISLATIVE RESOLUTION encouraging equitable and diverse gender repre-
sentation on corporate boards

WHEREAS, Of the 126 Fortune 1000 companies that operate in New York
State, (1) women total only 17.8 percent of the board members (2) only
36 percent of these boards have 20 percent or more of their seats filled
by women, (3) 12 percent have no women on the board, (4) There are no
companies that have a gender neutral board and (5) only one company has
more women directors than men. (6) Firms in the consumer goods sector
have the highest average percentage of women directors and (7) those in
the energy industry have the least; and
WHEREAS, A McKinsey and Company study entitled "Women Matter" showed
that companies where women are most strongly represented at board or
top-management levels are also the companies that perform the best,
companies with three or more women in senior management functions score
more highly, on average, on the organizational performance profile than
companies with no women at the top, and performance increases signif-
icantly once a certain critical mass is attained: specifically, when
there are at least three women on management committees with an average
membership of 10 people; and
WHEREAS, An Oklahoma State University study found that board diversi-
ty, including gender and ethnicity, is associated with improved finan-
cial value and that study also found that a significant positive
relationship between the fraction of women or minorities on the board
and firm value; and
WHEREAS, A report entitled "Women Directors on Corporate Boards" found
that gender diversity on corporate boards contributes to more effective
corporate governance and to positive governance outcomes through a vari-
ety of board processes as well as through individual interactions; that
women directors contribute to important firm-level outcomes as they play
direct roles as leaders and mentors, as well as indirect roles as
symbols of opportunity for other women, and inspire those women to
achieve and stay with their firms, and that more recognition is needed
for the valuable contribution of women directors to firm value; and
WHEREAS, Credit Suisse conducted a six-year global research study,
commencing in 2006, of more than 2,000 companies worldwide that showed
that women on boards improve business performance by key metrics,
including stock performance, as demonstrated by the fact that companies
with a market capitalization of more than $10 billion, whose boards have
women, outperformed shares of comparable businesses with all-male boards
by 26 percent; and
WHEREAS, The Credit Suisse report included the following findings: (1)
there has been a greater correlation between stock performance and the
presence of women on a board since the financial crisis in 2008, (2)
companies with women on their boards significantly outperformed others
when the recession occurred, (3) companies with women on their boards
tend to be somewhat risk averse and carry less debt, on average, and (4)
net income growth for companies with women on their boards averaged 14
percent over a six-year period, compared with 10 percent for those with
no women directors; and
WHEREAS, According to the study entitled "Women Directors on Corporate
Boards: From Tokenism to Critical Mass" and a report entitled, "Critical
Mass on Corporate Boards: Why Three or More Women Enhance Governance,"
attaining critical mass, going from one or two women directors to at
least three women directors, creates an environment where women are no
longer seen as outsiders and are able to influence the content and proc-
ess of board discussions more substantially, and boards of directors

need to have at least three women to enable them to interact and exer-
cise an influence on the working style, processes, and tasks of the
board, in turn positively affecting the level of organizational inno-
vation within the firm; now, therefore, be it
RESOLVED, That this Legislative Body acknowledge that the body of
evidence to date concludes that companies perform better when their
boards include women, and that the State of New York has a significant
stake in both protecting the shareholders of publicly traded companies,
as well as setting policies that enable them to perform better; and be
it further
RESOLVED, That the Legislature, encourages equitable and diverse
gender representation on corporate boards, and urges that, within a
three-year period from January 2015 to December 2017, inclusive, every
publicly held corporation in New York with nine or more director seats
have a minimum of three women on its board, every publicly held corpo-
ration in New York with five to eight director seats have a minimum of
two women on its board, and every publicly held corporation in New York
with fewer than five director seats have a minimum of one woman on its
board; and be it further
RESOLVED, That copies of this Resolution, suitably engrossed, be tran-
smitted to The Honorable Andrew M. Cuomo, Governor of the State of New
York.