By Ayman Chowdhury, Director, Programs & Advisory at Competent Boards and Cassandra Brown, Executive Communications & Engagement.

As we celebrate International Women’s Day (IWD), we prepare to commemorate the remarkable strides, achievements, and empowerment of women worldwide under the 2024 campaign theme “Inspire Inclusion”. Yet, amidst the celebrations, it’s important to acknowledge that IWD also serves as a reminder of the considerable distance we still have to travel to achieve true gender equity, particularly in corporate leadership. While progress has undoubtedly been made, the journey remains far from over. 

The Race of The Snails

The journey toward female representation on corporate boards and in leadership roles remains fraught with challenges and slow progress. The World Economic Forum’s report emphasizes the critical role of increasing women’s economic participation and achieving gender parity in leadership, across business and government, as pivotal levers for mitigating broader gender disparities in households, societies, and economies. It calls for a concerted effort from both private and public sectors to accelerate progress towards gender parity, highlighting the potential for igniting renewed growth and enhancing resilience across various domains.

Echoing this sentiment, Deloitte’s study provides a granular look at the representation of women in board seats globally, revealing a modest increase to 19.7% from the last report in 2019. Despite this incremental progress, the pace at which we are moving suggests a protracted journey to near-parity, anticipated only by 2045. This slow progress is further exemplified by the varying degrees of representation across different countries, with France leading the way at 43.2%, largely attributable to a robust gender quota implemented over a decade ago. Norway and Italy follow closely, thanks to similar national measures. In stark contrast, countries like South Korea, Kuwait, Saudi Arabia, and Qatar lag significantly behind, with less than 5% of board seats occupied by women. A new report by the Canadian Chamber of Commerce reveals Canada’s modest progress in enhancing gender equality in business. Despite some positive advancements, significant disparities remain in women’s representation and compensation in leadership and board roles. From 2016 to 2020, the proportion of women directors rose merely by 3 percentage points to 21%, underscoring the slow journey towards gender parity in corporate governance. 

Another intriguing aspect of Deloitte’s report is the correlation between female CEO leadership and board diversity. Organizations helmed by women CEOs or those with female Chairs boast considerably higher proportions of women on their boards, illustrating a virtuous cycle of gender diversity in leadership roles. This phenomenon not only underscores the impact of female leadership in promoting diversity but also highlights the potential for gender-diverse boards to foster further inclusivity in top executive positions.

Overcoming Obstacles and Seizing Opportunities

Embracing diverse perspectives, especially within boardrooms, propels organizations beyond conventional boundaries, creating a fertile ground for innovation and sophisticated problem-solving. Our board upskilling program has a dedicated module, which delves into the role of boards in managing human capital and diversity, equity, and inclusion (DEI). As global peers engage with this topic, the critical role of gender diversity as a driving force for corporate innovation is repeatedly emphasized. This underscores the profound impact that diverse leadership can have in driving transformative changes within companies.

Another point that gets highlighted in the peer-to-peer discussions is that a pivotal barrier to achieving gender diversity lies within the very fabric of company culture—an obstacle that necessitates deliberate and strategic intervention. By establishing clear diversity goals, metrics, and benchmarks, boards not only champion the ethos of inclusion but also hold the mantle of accountability, ensuring that the trajectory towards these objectives is both transparent and steadfast.

From an investment standpoint, the narrative of gender diversity unfolds with equal vigor. The concept of Gender Lens Investing (GLI) epitomizes how investors are leveraging their influence to champion gender diversity, recognizing it as not just a social or ethical choice, but a strategic one. High-profile examples include BlackRock’s stance on board diversity and State Street’s guidelines, which have set new precedents for corporate governance and prompted significant strides towards inclusivity within a remarkably short span. These actions underscore the investor community’s pivotal role in advocating for gender diversity, showcasing the profound impact of investment strategies aligned with gender diversity goals.

However, this journey is not without its challenges. While there’s a growing consensus on the value of diversity, some initiatives do encounter resistance or skepticism. The backlash, when it occurs, tends to stem from various sources:

  • Resistance to Change: Some organizations and individuals may resist these initiatives due to entrenched biases or a reluctance to disrupt the status quo. Change can be challenging, especially when it requires altering long-standing corporate cultures or governance structures.
  • Perception of Tokenism: There’s a concern that mandates for diversity might lead to token appointments, where women are selected for positions to meet quotas rather than recognized for their qualifications and contributions. This perception can undermine the broader goals of gender diversity initiatives.
  • Regulatory and Political Hurdles: In some regions, regulatory or political environments may be less supportive of mandates or policies that promote gender diversity. The degree of support can vary significantly from one jurisdiction to another, affecting the implementation and impact of these initiatives.
  • Implementation Challenges: Effectively translating diversity goals into action can be complex. Companies may struggle with finding qualified female candidates (due to systemic barriers in education and career advancement), integrating diversity into their strategic planning, or measuring the impact of their initiatives.

Way forward

At its core, the way forward demands a reimagining of leadership – where those at the helm are not only champions of diversity by decree but by deed. It necessitates a leadership ethos that is inherently inclusive, one that values and seeks out diverse perspectives as indispensable to the process of innovation and decision-making.

This transformation further hinges on a deliberate shift in corporate culture, one that moves beyond the superficial adoption of diversity policies to the cultivation of an environment where every individual, irrespective of gender, feels valued, heard, and supported. It involves a concerted effort to challenge and change the unconscious biases, norms, and practices that perpetuate gender disparities.

Moreover, the journey requires the active engagement of all stakeholders – from board members to employees, from investors to consumers. It calls for a collective reevaluation of what success looks like, where the metrics of achievement are not solely financial but are also measured by the depth and breadth of an organization’s commitment to gender equity.

The narrative of this journey is one of resilience and innovation, where obstacles are seen not as insurmountable barriers but as opportunities to rethink, reimagine, and redefine the future of corporate leadership. It is a story that acknowledges the complexities and challenges but is buoyed by a steadfast belief in the transformative power of diversity.

In essence, the way forward is less about the destination and more about the journey itself—a journey that invites introspection, demands action, and inspires a collective vision for a more equitable and inclusive corporate world. 

Reflection Points

Here are five pivotal questions that boards can ponder to galvanize meaningful change within their organizations:

  • Does our board composition authentically reflect our commitment to gender diversity, and what steps can we take to improve it?
  • Are the metrics we use to measure progress towards diversity effective, and do they truly capture the essence of inclusion?
  • What specific actions have we implemented to cultivate an organizational culture of equity and inclusion, and how can we enhance these efforts?
  • How are we actively developing and supporting a pipeline of female leaders within our organization, and what barriers need to be addressed?
  • In what ways are we engaging with stakeholders on the issue of gender diversity and inclusion, and how can we better align our strategies with their expectations and societal values?

We hope these questions serve as a compass, guiding boards toward a future where gender diversity and inclusion are not just aspirations but realized pillars of corporate success.

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