THE quest for gender diversification at board level in major companies worldwide appears to be a fairly recent phenomenon, but the progress made has been encouraging.
Globally, the number of women on boards has been increasing for the last three years. According to ISS QualityScore data, overall female board representation globally had increased to16.9% in 2016, from 15.3% in 2015 and 14.5% in 2014.
The importance of having female directors on boards is indisputable. Their board presence has helped companies become more ethical and equitable employers.
But progress in accepting woman on board has been uneven. Some countries, such as Norway, have an average of over 40% female board representation, while South Korea only registers 2.3%.
According to a 2014 report by Washington-based Corporate Women Directors International, countries which have strong legislation and targets have the highest percentage of female directors.
This may be seen in European countries where hard laws and gender quotas are in place. For example, Norwegian law defines strict quotas, with one rule stipulating that each sex be represented by at least 40% of the board members. Females chalked up 42% on Norwegian boards last year.
While some markets do not have laws, they have guidance. For example, the British government backed a non-binding target of 25% women. As of October last year, all FTSE 100 boards had met the target.
In some regions, social norms seem to drive the change. For example, Sweden and Finland – which do not have targets on gender diversity – have one of the highest number of females on boards.
In the United States, social movement play a part. There is no law on women representation, but there are campaigns to create awareness. For example, 2020 Women on Boards is a national campaign to increase the percentage of women on boards to 20% or more by the year 2020.
While the ideal situation is to allow social norm to dictate women representation, the imposition of law and guidelines appear to be effective in accelerating change in markets that oppose gender equality and resist progress.