The shapewear company Spanx, known for its body-slimming undergarments, is worth an estimated $1.2 billion following the investment firm Blackstone’s decision to purchase a majority stake in the company.
CEO Sara Blakely, who started Spanx with just $5,000 in 2000 and became the world’s youngest self-made billionaire in 2012, worked on the deal with an all-female team led by Blackstone managing director Ann Chung, as the Wall Street Journal first reported. The companies said they intend to create a 100% female board of directors as well.
Spanx models itself as a company “for women, by women,” as it says on its website, and Blakely committed in 2013 to giving away at least half her wealth to charity with the intention of investing in women. The Blackstone deal is the first outside investment in Spanx, which remains a private company. Blakely will continue to oversee daily operations, while serving as the board’s executive chair.
Spanx’s commitment reflects a broader push to diversify boards
The deal between Spanx and Blackstone comes as US companies are adding more women to their boards. Some of this has been driven by gender-diversity campaigns mounted by major institutional investors in recent years, according to recent research conducted by scholars at Northwestern University’s Kellogg School of Management, the University of Washington in St. Louis, and the University of Alabama.
The research found that diversity campaigns led by the investment firms Vanguard, BlackRock, and State Street had effectively driven companies to appoint more women to their boards. “When your largest shareholders create a ruckus, you listen,” David Matsa, a finance professor at Kellogg, noted in a blog post. “And in important ways, their advocacy can be more effective than legislative mandates.”
According to the executive search firm Spencer Stuart, companies in the S&P 500 index appointed 456 new independent directors in the past year, the most since 2004, and 72% of the seats went either to women or to men from historically underrepresented racial and ethnic groups, up from 59% last year.
Blackstone has set a mandate that at least one third of board seats at the new companies it acquires in the US and Europe must be filled by diverse candidates, with diversity referring to gender, race, or sexual orientation. Its portfolio includes the female-led company Bumble, as well as actress Reese Witherspoon’s media company, Hello Sunshine.
The needle is moving toward more gender diversity on boards
More than a quarter of board seats in the Russell 3000 Index belonged to women during the last quarter, compared to 15.1% just five years ago, according the corporate leadership research firm Equilar. Still, just 84 of these boards had achieved gender parity, meaning that they were represented by 50% women. And companies still struggle to achieve adequate racial and LGBTQ representation on their boards as well. Justine Smyth, chair of the New Zealand telecommunications company Spark, has suggested that while the first “diverse” appointees on company boards may feel like tokenism, those members can help advocate for change once they are given decision-making power.
Spanx’s commitment to an all-women board of directors goes further than most companies ever get when it comes to female representation.
“Spanx is a beloved brand made for and by women,” said Lorraine Hariton, the president and CEO of Catalyst, a nonprofit that advocates for advancing women to leadership positions in the workplace. “It only makes sense that talented and qualified women would be prominently represented on their board.”