In the past decade, increasing gender diversity has been a prominent issue for boardrooms across the globe. In fact, studies show that female chief executives tend to produce better results for their companies than their male counterparts do.
According to a Diligent Institute report Norway, France, Sweden and Italy are among the countries with the highest percentage of women serving on boards. Regionally, countries in the Americas and Asia Pacific region have progressed the least. With respect to women chairs, the three regions have about the same percentage: Europe, the Middle East, and Africa (EMEA) (5 percent), the Americas (percent 4 percent) and Asia-Pacific (4 percent). Yet locally, the percentage of female CEOs in JSE-listed companies improved 8 percent as of end June 2022, up from 5 percent a year earlier – a cause for celebration. Yet these women still earn 31 percent less than men.
Locally, a recent version of the annual Africa-wide non-executive director’s survey report compiled by Business advisory firm Sirdar, Africa’s leading guide, appointer, and educator of high-performance boards, cites an improvement in female representation in boardroom composition with 40 percent of board members being female, up from 23 percent in 2020.
While this might not be obvious, Sirdar’s survey found that in boards with female directors, 75 percent reported that the company’s Earnings Before Interest, Taxes, Depreciation, and Amortisation (Ebitda) increased or remained the same compared to the previous year, with 25 percent reporting a decrease. In boards composed of only males, this decrease in Ebitda was true of 34 percent of businesses.
Furthermore, 70 percent believed that their board’s impact on the company was effective (56 percent of those who considered their boards effective noted that they felt their boards were, in fact, “highly” effective), while 66 percent of boards with no female members were considered effective (with only 40 percent of these being considered “highly” effective).
In boards with at least one female director, there was a significantly larger report of an increase in Ebitda (of more than 10 percent), when compared to boards composed only of males (66 percent compared to 60 percent).
Boards composed only of males were significantly less likely to feel that the board composition had the appropriate knowledge and experience to govern the company (80 percent agreement) when compared to boards with at least one female director (95 percent agreement).
“The data is very clear, women had value to the board. Next time you have an empty seat around the boardroom table, avoid discounting women, stereotyping and thinking that women are not suited to your industry. Having a female board member might bring just the perspective that your board needs.”, says Kieron McRae, the chief executive of Sirdar.
BUSINESS REPORT