Investors are among the most influential advocates for change.
Women are still largely underrepresented on corporate boards worldwide, despite continued efforts to improve boardroom gender diversity.
Deloitte’s latest Women in the Boardroom report reveals that women hold just 15 per cent of board seats across the globe, a modest progress from the 12 per cent reported two years ago.
The report includes a small sample (18) of New Zealand companies.
It finds New Zealand fares above average compared to the global sample, with 28 per cent of board seats and 11 per cent of board chairs held by women. None of the companies analysed have female CEOs.
Deloitte New Zealand partner Peter Gulliver says despite the small sample size, the results for New Zealand are consistent with recent local research.
“The New Zealand Census of Women on Boards 2017, published last month by AUT professors Judy McGregor and Stevie Davis-Tana, shows that the number of women on the boards of NZX top 100 companies has climbed above 20 per cent for the first time, with over 22 per cent of board members now women.
“However, according to AUT, the number of female board chairs and CEOs of the top 100 companies have not changed since 2012, holding steady at seven and three respectively,” says Gulliver, in a statement.
“Given the correlation between women leaders and female board representation, these last two statistics, along with the fact that none of the Kiwi companies analysed for Women in the Boardroom have a woman CEO, are particularly concerning,” he adds.
“Bridging the gender divide in the workforce is not only a matter of fairness, but also of effective governance and inclusive economic growth.”
Gulliver notes the private sector in New Zealand continues to lag behind on gender diversity in the boardroom.
Due to increased government focus in recent years, the number of women on New Zealand state sector boards and committees is at the highest point ever, he says.
While there is no legislated gender quota for boards in New Zealand, the government has committed to increasing women’s participation on state sector boards and committees to 45 per cent.
Women represented 43.4 per cent of state sector boards and committees at the end of 2015, up from 41.7 per cent in 2014, the report states.
Deloitte says the global, regional and country analysis are based on a dataset covering nearly 7000 companies in 44 countries, and including more than 72,000 directorships across Asia Pacific, America and the EMEA.
Gulliver says that for the first time, the report includes a region-by-region analysis of the relationship between corporate leadership and diversity.
The report finds a direct correlation between female leadership (CEOs and board chairs) to board seats held by women.
“Organisations with women in the top leadership positions have almost double the number of board seats held by women,” says Gulliver. “The inverse is true as well, with gender diverse boards more likely to appoint a female CEO and board chair.”
“This illustrates an important trend—as the number of female CEOs and board chairs climbs, it is likely to spur greater board diversity.
“Yet, the percentage of women securing top leadership roles remains very low, with women holding only 4 per cent of CEO and board chair positions globally,” he says.
The fact that none of the Kiwi companies analysed for Women in the Boardroom have a woman CEO, is particularly concerning.
Wanted: Influential advocates of change
Dan Konigsburg, senior managing director, Deloitte Global Center for Corporate Governance, says Deloitte continues to view investors as among the most influential advocates for change.
He cites how State Street Global Advisors has recently stated they will vote against directors if companies do not adequately seek to improve their boardroom diversity.
“That one of the world’s largest institutional investors would do this, during the same week they unveiled a statue in New York of a young girl standing down the iconic charging Wall Street bull, is perhaps the surest of indicators that we are in new territory,” says Konigsburg.
Deloitte, meanwhile, cites measures to increase diversity beyond gender in New Zealand.
The Future Directors Programme of the Institute of Directors works with ‘rising stars’ and gives them the opportunity to shadow and participate in a boardroom environment for over a year. The programme was extended to include state sector boards, to ensure Kiwi organisations can access the right talent to assemble diverse boards, the report states.
Another organisation, Diversity Works NZ, held its annual Diversity Summit in August last year. The group featured the latest research and global programmes on diversity to help organisations of all sizes and across sectors to improve their diversity strategies.
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