Women on boards are being closely monitored internationally as an indicator of women’s progress and gender equality. This international benchmarking was once the preserve of research agencies and academics only. It has been given impetus by the controversy over countries such as Norway followed by Netherlands, France and Spain, who in the past decade have legislated to boost gender parity in the boardrooms. One of the international bodies, Corporate Women Directors International (CWDI), provides regular comparative data and uses figures from the Commission’s Census report for New Zealand in its annual benchmarking.
The Commission has compiled the following comparison using its own latest figures, the most recent material from the Australian Institute of Company Directors, international research from Cranfield University in the United Kingdom and from Catalyst in the United States, as well as from the CWDI.
Internationally the total percentage of women board members continues to increase at a glacial pace with regional variation, cultural influences and sector impacts. For example the CWDI 2010 report analysing the top 200 companies in the world found:
- Over three-quarters (77.5%) of the 200 largest companies in the world have at least one female director, but 22.5% still do not have a single woman on their boards of directors.
- Asian companies comprise the majority of companies with no female directors with Japan having the most companies with no female directors. A high 64.4% of the companies
with no female directors are from Asia.
- The Food Consumer Products industry had the highest representation of women directors in an industry comparison of the top 200 companies, with 27.1% of board seats held by women.
It is clear that the movers and shakers in terms of women on boards are the countries who have legislated for it to happen. The Female FTSE Board Report 2009, one of the most authoritative benchmarks of women on boards which has been published in the United Kingdom for eleven years, recently added Norway and Spain to its benchmarking data.
Table 1 - International Comparison of Women as Company Directors
One of the learnings from the comparative information was that: The common theme characterising both Norway and Spain is that they are actively trying to increase the number of women on their corporate boards and want significant, as opposed to incremental, increases. Interestingly, both countries were at a lower starting point than the UK when their governments took action. But, of course, today due to their action they are progressing at a faster pace.
The Australian Experiment
Closer to home Australia is currently more proactive than New Zealand and it appears to be paying dividends. So far in 2010, 36 women have been appointed to ASX 200 boards, compared to only ten for the whole of last year, according to the Australian Institute of Company Directors. The Australian Institute is now updating its figures daily, based on the same analysis of ASX data used by the Equal Opportunity for Women in the Workplace Agency (EOWA) in its two year Census report. This enables prominence and timeliness of women’s gains and media visibility of important landmarks like Australia hitting the 10% threshold in ASX 200 companies. The Institute has also announced a range of initiatives to address board diversity, including the ASX 200 Chairmen’s Mentoring programme and a new scholarship funded jointly with the Federal Government, offering 70 scholarships for women to undertake flagship director education.
From 1 January 2011 ASX companies will be encouraged to disclose in their annual reports:
-Their achievements against gender objectives set by their board, and
-The proportion of women on the board, in senior management and employed throughout the whole organisation.
Boards are also urged to determine the appropriate committee for recommending strategies to address board diversity, to consider diversity in succession planning, and to have a charter that regularly reviews the proportion of women at all levels in the company. Boards are expected to disclose the mix of skills and diversity they are looking for in their membership and ensure that there is an accurate and not misleading impression of the relative participation of women and men in the orkplace.
Australia’s Sex Discrimination Commissioner Elizabeth Broderick, in the 2010 Gender Equality Blueprint wants to go further. She recommends the promotion of a “target of 40% representation of each gender on all publicly listed Boards in Australia, to be achieved over five years.” If progress is not made, “the Australian Government should consider legislating to require publicly listed companies and other large employers to achieve a mandatory gender diversity quota of
a minimum of 40% of both genders within a specified timeframe, failing which penalties will be imposed.” The 40% target for each gender is similar to the formula used by Norway.
There is no requirement in New Zealand for listed companies to develop or report diversity measures. There was both support for, and opposition to the Australian move when it was announced. The Business Herald reported Wellington lawyer Mai Chen, the Chair of Global Women, as saying the ASX had shown leadership on the subject, “I can’t see why New Zealand wouldn’t be ready for a similar move”.
Well known company director Rosanne Meo said she had concerns about quotas but the ASX’s voluntary approach should be considered. “When you look at the little progress that has been made around the board tables I guess you have to start looking at some of these options.” Auckland shareholder, Shelagh Coop, who makes a point of asking about women’s representation at annual meetings, said she wanted NZX to follow its Australian counterpart. Less enthusiastic was Institute of Directors CEO Nicki Crauford who was “very cautious” about the NZX following the ASX. “I think this runs counter to the interests of women if you’re not careful, because people will perceive that women are in either management or board positions simply to make up the numbers”.