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Inside Beauty’s Board Diversity

“The best decisions are made with a diverse collection of ideas and thoughts and perspectives, and every company benefits from having that," said Bonnie Gwin of Heidrick & Struggles.

Mary Dillon has long been a trailblazer in corporate America. 

When she joined the Target board in 2007, it was a big deal, and not just because Dillon is a woman. At the time, she was working as chief marketing officer at McDonald’s, and CMOs were not routinely being asked to take board positions. 

“The CEO of the company of the time, his name was Bob Ulrich — it was quite visionary because he reached out to me as a chief marketing officer. He wanted to add more diversity to his board, he wanted more women, more people of color, and he said to me, with the experience you’ve had so far … someday you might be a CEO, but then you might not be able to join my board, so I’d love to talk to you now,” Dillon recalled.

Since then, Dillon has continued her rise through the ranks of corporate America, becoming one of the few female chief executive officers in the Fortune 500 when she led Ulta Beauty from 2013 to 2021. 

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That strategy — widening the pool of potential board candidates — is one that beauty companies are increasingly employing as they look to further diversify their boards in order to shore-up business performance. 

It has been proven that companies with diverse leaders perform better, and today’s boards are vested with power: to pick CEOs, to approve compensation packages, to weigh in on M&A, to guide for the future.

“We live in a much more complex world now than we might have 50 years ago, when you could have just had your friends who were all CEOs on the board. It’s complex to run these large organizations, and you need a variety [of people],” said Catalyst CEO Lorraine Hariton.

In 2017, the Procter & Gamble board went through a massive shakeup when shareholder Nelson Peltz said the company’s culture was too insular, and that it should acquire small, growing brands. Ultimately, he landed a board seat, and since then, P&G has acquired several small, growing brands. These days, Unilever is going through a shakeup of its own — the board’s push for M&A just led to several failed bids for GSK, and the company unveiled a major reorganization that resulted in the departure of beauty and personal care president Sunny Jain on Tuesday. 

As companies look to shore up their futures, having a board with diverse skills, backgrounds and experiences becomes more important, experts agreed. 

“The best decisions are made with a diverse collection of ideas and thoughts and perspectives, and every company benefits from having that,” said Bonnie Gwin, co-managing partner of the global CEO and board of directors practice at Heidrick & Struggles.

“Boards and companies have recognized that they’re at an inflection point and that representing their stakeholders, their shareholders, their employees, the people who use their products, for example, it’s really important to have those voices around the board and really important to have a diverse set of voices around the board,” Gwin added.

Research from Heidrick & Struggles shows that of the 425 board seats filled in the Fortune 500 during 2020, 28 percent went to Black directors, up from 10 percent in the prior year. Appointments for female board members decreased in 2020, from 44 percent to 41 percent, after three straight years of increases. However, Black women, Asian women and Latina women were appointed to slightly more board seats during the year, Heidrick’s research showed. 

Hariton said that today’s “well-run” companies are “trying to mirror their populations. In beauty, “there’s an argument” that boards should include more than 50 percent women, she said. 

An analysis of 17 leading beauty businesses* from Equilar shows that beauty boards are slightly more diverse than the broader marketplace, but do not reflect parity with the broader population. In total, the beauty companies analyzed had 42.4 percent female board members, versus 21.6 percent in the Equilar 500 (the 500 largest companies in the U.S. by revenue). The beauty company boards were 28.8 percent ethnically diverse, compared to 21.6 percent ethnically diverse in the Equilar 500, the company said. The statistics for beauty companies include international companies, including Amorepacific, Kao and Shiseido, which have boards made up entirely of people of color. 

“Fashion and beauty companies tend to [have] a more diverse audience in terms of their consumer base, and these companies tend to align their board executives with their consumers and their values,” said Amit Batish, director of content at Equilar.

E.l.f. Beauty and Olaplex have two of the most diverse boards in beauty, according to Equilar’s analysis. E.l.f.’s board is 78 percent diverse, with 56 percent women and 33 percent ethnic diversity, while Olaplex’s board is 82 percent diverse, with 73 percent women, and 18 percent people of color. 

The least diverse board from the Equilar beauty analysis is Inter Parfums, which is 10 percent women with zero ethnic diversity. LVMH’s board also has no ethnic diversity, Equilar’s analysis showed, though it does have 44 percent women. Beiersdorf, Coty and L’Oréal’s boards also have little representation for people of color, and ranked in the single digits, percentage wise, in Equilar’s analysis.

For some beauty companies, including newly public Olaplex, creating a diverse board has been paramount. 

When Olaplex started building out its board under private equity owner Advent International, the approach to seek out women was intentional, said the company’s CEO JuE Wong.

“If you look at a lot of boards everywhere, there’s a lot more men than women, and the refrain has always been there’s just not enough women in the pipe to fill board roles, just like … there’s not enough senior women to fill CEO roles,” Wong said. “We asked ourselves, ‘Is that really the case?'”

For Olaplex, it wasn’t — the company’s 11-person board includes nine women, including early Olaplex employee Tiffany Walden, Condé Nast CMO Deirdre Findlay and Tricia Glynn, managing director at Advent. The two men on the board are also from Advent, which still owns a stake in the business. It is common for private equity executives, who are predominately men, to join the boards of companies they back. 

“When we were trying to figure out the women, it came quite easily, it wasn’t difficult,” Wong said. Olaplex’s customers and employees are overwhelmingly women, Wong said. “We wanted the board to reflect that.” 

For the Estée Lauder Cos., building a more diverse board has been “very intentional,” said executive chairman William P. Lauder, who has been on the board for 26 years. Today, seven of the company’s 15 board seats are held by women. 

“The composition has changed, and it’s changed meaningfully,” Lauder said. “It didn’t happen by accident, it happened through focused effort and attention.”

Lauder’s most recent board appointments — Jennifer Hyman, the CEO and cofounder of Rent the Runway, and Jennifer Tejada, the CEO of PagerDuty — were suggestions from other board members, Lauder said. The company was looking for someone with social media and technology expertise, and received two different lists of candidates from two different board members, Lauder recalled.

“What really surprised me was these two lists — independently sourced — did not have any overlap. There were no same names on both lists. I was looking, but not looking so, so hard, and I found 20 candidates who are capable and qualified … I use that as an example to say, it’s very possible,” said Lauder, of identifying qualified female candidates.

Wella, which is now majority-owned by private equity firm KKR, is in the process of building out a board, said CEO Annie Young-Scrivner. Currently, Wella is looking for someone with technology expertise, Young-Scrivner said.

“We’re searching for a board member to be added to our Wella board, and what I shared with a recruiter is I want 100 percent of the slate to be female,” Young-Scrivner said. “It’s the only search where we’ve gone in and said it 100 percent has to be female — for the rest of our search, we just want the slate to be diverse.”

When building a board, Gwin advises companies to think about their purpose, mission, geographic areas of focus and stakeholders — not just shareholders, she said. 

“The best boards think about this as a set of strategic skills and experiences and voices and they do planned board succession over time. They are continually thinking about, ‘what do we need to add in to meet this moment and to meet the coming moments,’” Gwin said.

Companies should also consider a broader array of candidates than just executives in CEO positions, experts said. Gwin advised considering other C-suite positions, as well as heads of human resources and entrepreneurs, when trying to fill board seats.

“If you think down the road and think about adding diverse talent to your board, you have to open up the aperture and not only look, for example, at sitting CEOs, because there aren’t going to be as many women or people of color as sitting CEOs for a long time as there are men, white men,” Dillon said. “If you want to increase the pipeline of talent, you have to look beyond the standard ways we used to look at what’s required to be on a board.”

Bringing a broader pool of candidates into board positions also gives those executives more experiences to potentially land a CEO job, experts said. 

Several female beauty executives — with and without CEO titles — currently hold board seats. For example, Tracey Travis, executive vice president and chief financial officer of the Estée Lauder Cos. is on the board of Meta (Facebook) and Accenture; Dillon is on the boards of Ulta, KKR and Daily Harvest, a food start-up; Wong is on the board of Olaplex, as well as VSRI; Young-Scrivner is on the board of Yum! Brands; Sundial CEO Cara Sabin is on the board of CitiTrends; Esi Eggleston Bracey, chief operating officer, executive vice president for beauty and personal care at Unilever, is on the Williams-Sonoma board; and former Shieseido Americas CEO Heidi Manheimer has served on boards for Burton, Herman Miller and Surratt. 

At Ulta, Dillon said the company is focusing on developing talent at all levels in order to increase the number of diverse candidates for C-suite positions.

“In order to expand the pool of candidates that are going to serve on a board it also makes sense for companies to make their senior executives available for board service. It’s a virtuous situation. It helps the women, and helps more diversity on boards,” Hariton said. “If you aspire to be CEO of a corporation, one of the things that can help you in your career development is board service.” 

Young-Scrivner, Wella’s CEO, said that she sought out her first board role because she was looking for new experiences and learnings. “I was very much hungering other industries to understand the cross synergies where my own company could benefit, but also I could benefit the other company,” she said.

Then, she was an executive vice president at Starbucks and president of the Teavana business. Craig Weatherup from the Starbucks board introduced her to Terry Lundgren at Macy’s, she said, and she joined the Macy’s board in 2014.

“It was around 30 or 40 percent female by the time I went on there — it was myself, Leslie Hale, we added more women, so we were over 50 percent female representation,” she recalled.

“As a board member, it’s an opportunity for you to surface potential candidates,” Young-Scrivner said. “And if that board is only male, most likely, a lot of the candidates that they serve could be male.”

Wong also advises executives who might have to pass up a board opportunity to make recommendations.

“When they are looking to recruit another board member, I have found that that is where your voice is important,” Wong said. Have a list of candidates ready that are good so you can start recommending people. If somebody approaches you and you can’t do that board, recommend other people who you believe could be good,” Wong said.

Once on a board, members are tasked with balancing vocalizing opinions on areas of expertise without meddling in the day-to-day business of the company.

At Macy’s, Young-Scriver had a “board buddy,” she said. “After my first board meeting, I recalibrated with [board buddy Weatherup] and Terry Lundgren to say, hey what went well?'” she said. “You don’t get hired just to align and agree if that’s not your point of view because you should be providing a perspective that’s going to be helpful — help the company see what’s around the corner, and guide them to be more successful.”

*Equilar ran the numbers on 17 beauty company boards for Beauty Inc. They include: Amorepacific, Bath & Body Works, Beiersdorf, Coty, E.l.f. Beauty, Inter Parfums, Johnson & Johnson, Kao Corp., L’Oréal SA, LVMH Moët Hennessy, Olaplex, Revlon, Shiseido, The Estée Lauder Cos., P&G, Ulta Beauty and Unilever. 

Top 3 Takeaways 

When trying to build a diverse board, companies should broaden the pool of candidates they consider beyond C-suite executives.

Boards should reflect a company’s stakeholders — not just shareholders.

A concentrated effort to create diverse boards has resulted in progress at companies like the Estée Lauder Cos.and Olaplex.




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