Australian companies are under pressure to have just as many Sharon’s on boards as Johns, and not just because of the timely placement of the defiant girl statute in front of Wall Street’s charging bull, but because of real diversity.
As the inaugural Financy Women’s Index showed, improvement is being made on women’s workplace progress with the top ASX 20 companies surpassing a 30 per cent target for women on boards.
But what the Index also revealed is that we have many of the same women and, yes men sitting on multiple boards, according to analysis over 700 annual reports by Data Digger.
Just looking at the women over the past five years Nora Scheinkestel has sat on three top ASX 20 boards, two at the same time with Telstra and Insurance Australia Group.
Alison Deans has also occupied two boards at the same time and is currently sitting on Westpac and Insurance Australia Group.
While Carolyn Kay has also occupied three boards, and two at the same time in Brambles and Scentre Group.
Also sitting on multiple boards at the same time has been Catherine Livingston, Christine Cross, Christine O’Reilly and the list goes on.
Among the many more men who appear on multiple boards over the six years include Brian Long on Brambles and CBA, Brian M Schwartz on Scentre Group, Insurance Australia Group and Westfield. While Craig Dunn also appears on the boards of Westpac and Telstra.
As the ABC’s Alan Kohler raised to me yesterday, before mentioning the Financy Women’s Index in his evening finance report, we have too many Johns, and now I’m beginning to worry that we could soon have too many Sharons.
With this comes the risk that widespread gender diversity in listed companies could be stifled by a lack of real diversity – diversity of opinion, not just gender.
It’s possible that these women, and the many men who appear multiple times may be just super talented, or we have a shallow pool of talent and companies are busting to meet key targets by appointing the same people.
What we’re seeing in the United States is greater demand being placed on Wall Street to do better, and arguably there’s a lot more work that needs to be done in Australia too.
To mark, International Women’s Day and for this week, one of the world’s biggest asset managers State Street Global Advisors (SSGA), said it would use its proxy voting power against companies that fail to take steps to increase its female membership on boards.
“We believe good corporate governance is a function of strong, effective and independent board leadership,” said Ron O’Hanley, president and chief executive officer of SSGA.
“A key contributor to effective independent board leadership is diversity of thought, which requires directors with different skills, backgrounds and expertise.
“Today, we are calling on companies to take concrete steps to increase gender diversity on their boards and have issued clear guidance to help them begin to take action.”
It’s estimated that one out of every four Russell 3000 companies, a US Index, do not have a woman on their board, and nearly 60 per cent have fewer than 15 per cent of their boards comprising women directors.
According to an MSCI study, companies with strong female leadership generated a return on equity of 10.1 per cent per year versus 7.4 per cent for those without a critical mass of women at the top, which is a 36.4 per cent increase of average return on equity.
A 2015 McKinsey Global Institute report also found that where women participate in the economy identically to men would add up to $28 trillion, or an additional 26 per cent, to annual global GDP by 2025 compared to a business as usual scenario.
Indeed, what we know is that if we saw a significant increase in the number of women working full-time in Australia, compared to what we have at just under 3-million females, then this would be the equivalent to a mining-like boom for the economy.
So clearly more work is needed on encouraging gender diversity on boards in Australia, but also diversity, and in supporting more women in the workplace.
The next Financy Women’s Index will be published in the months ahead to keep track of the economic progress of women. Sign up here if you want to receive it.
