Sarbanes-Oxley.
Two words that many chief executives don't like to hear. The two-year old corporate governance law conjures up unpleasant thoughts of the hundreds of hours and tens of thousands of dollars needed to comply with the law's reporting and monitoring requirements.
But for Barbara J. Krumsiek, president and chief executive of Bethesda's Calvert Group, the nation's largest family of "socially responsible" mutual funds, Sarbanes-Oxley is "an unprecedented opportunity," to change the way corporations think about diversity.
"With Sarbanes-Oxley, companies were going to have to have much more independent boards. We did the arithmetic and discovered that some 9,000 new board seats would be opening up in the next two years. What a wonderful time for companies to think a little differently," Krumsiek said.
In 2004, Calvert filed seven resolutions with companies, asking them to diversify their boards of directors and contacted 154 companies it invests in that had no female or minority directors.
In the past few months, Calvert has found that 48 of the 154 companies, or 31 percent, have added at least one woman or one minority to their board.
In June, Calvert released its Women's Principles, a code of conduct for corporations that sets goals, such as wage equality and increasing the number of female-owned suppliers and managers. Last week, Dell Inc. and Starbucks Corp. said they would implement the principles.
"We're an investment firm. Creating a code of conduct is unusual. But we felt there was a gap and we needed a tool for our own analytic purposes" to gauge how companies treated female employees and suppliers, Krumsiek said. At some point, Calvert will rate companies using the principles.
Krumsiek, a native New Yorker, became head of the Calvert Group in 1997 after spending 23 years at Alliance Capital Management LP in Pittsburgh. As a senior vice president and managing director of the firm's mutual fund division, she oversaw more then $17 million in mutual fund assets. She holds a master's degree in mathematics from New York University.
"Gender equity is not an issue of the past," she said. "It's an issue of the present."
