women on boards

Follow the money for women on boards

Australia's top performing companies are still leading the way when it comes to women on boards. But what's everyone else doing? Not enough.

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The good news is that the biggest money earners in corporate Australia have the most women on boards, but the downer is, there are still too many that don’t.

That’s among the latest findings from the Quarterly Gender Diversity report released today by the Australian Institute of Company Directors (AICD).

The report found that of the top20 listed companies by market capitalisation on the Australian stock market, 14 of them have reached a key 30 per cent target of female board members.

Among those top performers is Commonwealth Bank of Australia with the biggest market capitalisation of $141 billion. It has 4 women occupying board positions.

The findings are in line with the result of the Financy’s Women’s Index, which found the number of women occupying board positions in the top20 was on the rise.

But the result gets worse as more companies are assessed. This suggests that greater shareholder pressure is being applied to the top end of town to improve its board diversity.

The other potential influencer is that research also shows greater leadership diversity improves company performance.

According to the report for the period March – May 2017 the percentage of women being appointed to ASX 200 boards has fallen in the in the first six months of this year.

There are still 13 companies on the ASX 200 with no women on their boards at all, including Flight Centre and Bellamy’s Australia.

The drop female appointments means the AICD’s target of achieving 30 per cent female representation by the end of 2018 could be missed.

“We are currently at a monthly new appointment rate of 30 per cent,” said AICD chairman Elizabeth Proust.

Ms Proust added that the research also showed that gender diversity on boards led to better business outcomes, and that 30 per cent was the tipping point where critical mass was reached in a group setting.

“This equates to 17 female appointments compared to 40 male appointments so far this year.

“If the monthly new appointment rate continues to hover around the 33 per cent mark, then we won’t achieve our target until 2019,” said Ms Proust.

The report shows the monthly rate of female appointments to ASX 200 boards has declined from 44 per cent in 2016 to just 30 per cent in 2017. This equates to 17 female appointments compared to 40 male appointments in the first five months of 2017.

On a more positive note, the report shows that the number of ASX 200 boards that have reached the 30 per cent target has risen to 71, more than double the number that had reached the target two years ago.

Women also make up 25.4 per cent of ASX 200 directorships.

“While we’ve made great progress since 2009 when women made up only 8.3 per cent of ASX 200 boards, the drop in the rate of female appointments in 2017 is of significant concern,” she said.

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