Deloitte Global finds gender diversity on boards doubled in organizations with female leadership

Published: 12 June 2017

Women are still largely under-represented on corporate boards, despite continued efforts to improve boardroom gender diversity. The fifth edition of Deloitte Global’s Women in the Boardroom: A Global Perspective publication explores the efforts of more than 60 countries to promote boardroom gender diversity, and reveals that women hold just 15 percent of board seats worldwide. These numbers show only modest progress from the 2015 edition of Women in the Boardroom.

For the first time, the publication includes a region-by-region analysis of the relationship between corporate leadership and diversity. A direct correlation was found between female leadership (CEOs and board chairs) to board seats held by women.

“Organizations with women in the top leadership positions have almost double the number of board seats held by women. The inverse is true as well, with gender diverse boards more likely to appoint a female CEO and board chair,” said Dan Konigsburg, senior managing director of Deloitte's Global Center for Corporate Governance. “This illustrates an important trend—as the number of female CEOs and board chairs climbs, it is likely to spur greater board diversity. Yet, the percentage of women securing top leadership roles remains very low, with women holding only 4 percent of CEO and board chair positions globally.”

Bridging the gender divide in the workforce is not only a matter of fairness, but also of effective governance and inclusive economic growth.

"Over the past few years, mainland China has made some progress in increasing gender diversity on boards. Women account for 10.7 percent of board seats; an improvement (2.2 percent) from 2015. Also, 5.4 percent of A-share listed company boards are chaired by women. Interestingly, 72 percent of the A-share listed companies with boards chaired by women saw an increase in their stock prices in the past years. We hope these trends will continue, and accelerate, in the years to come," said Norman Sze, Partner and Leader of Deloitte Mainland China Governance Center.

Inclusive growth and the future of work

As organizations navigate technological and societal shifts which are transforming the future of work, boards will have a critical role to play. Diversity of thought—and people—will be critical to ensure that board members are exploring challenges from every angle and consistently bringing a fresh point of view.

“Enhancing the diversity of the workforce and fostering inclusive growth is top of mind for Deloitte,” continued Konigsburg. “To support these goals, we are actively involved with initiatives ranging from our engagement with the B20 to increase female workforce participation, to our collaboration with the OECD in support of the United Nations 2030 Agenda for Sustainable Development which includes bringing gender equality to the center of economic development.”

Konigsburg added, “Deloitte also continues to advocate for diversity in boardrooms through our "Board Ready" programs which are delivered across the globe to help prepare women for board service.”

In Hong Kong, while progress has been made by some leading Hong Kong-listed companies, there has been no significant increase in the overall proportion of board positions held by women in such companies since the Hong Kong Stock Exchange introduced its comply-or-explain rules on the disclosure of diversity policies.

Deloitte China Risk Advisory Partner, Hugh Gozzard, said, "In the absence of a strict quota regime, the main forces for improving gender diversity on boards are instead non-regulatory in nature and relate to changes in culture and attitude that need to take place within companies themselves. Also, Hong Kong-listed companies, like those in many other jurisdictions, are focusing on addressing major external challenges relating to a highly competitive economic environment, rapid technological change, increasing costs and greater vulnerability to reputational damage. Though these challenges might usually be expected to reduce the attention paid to gender diversity, they should actually encourage boards to explore it as a means of improving performance, given that the positive connection between gender diversity and performance is increasingly supported by empirical research."

Highlights of additional findings from the research include:

Boardrooms across the Americas region are not highly gender diverse

• In the US, only 14 percent of board seats are held by women, a 2 percentage point increase from the 2015 edition. The percent of female board chairs has not progressed, remaining at just under four percent. 
• The percent of board seats held by women in Canada grew to 18 percent, a 5 percentage point increase since 2015. The percentage of boards led by women dropped from 6 percent in 2015 to 5 percent in 2017. 
• In Latin and South America overall, only 7 percent of board seats are held by women and 2 percent of board chairs are women.

Progress across EMEA varies significantly

• Norway, the first country to ever introduce a gender quota, has the highest percentage of board seats held by women (42 percent). 7 percent of board chair positions are held by women.
• In the UK, there are no quotas in place for women on boards, but 20 percent of board seats and 3 percent of board chair positions are held by women. 
• The percentage of board seats held by women has increased to 28 percent in Italy. However the number of female board chairs fell 14 percentage points since 2015 to 9 percent.

Boardroom diversity in Australasia is on the rise

• There are no gender quotas in Australia for women on boards; however the numbers continue to improve. The percentage of board seats held by women is currently 20 percent and 5 percent of board chairs are women.
• New Zealand achieved the strongest growth since 2015, with the number of board seats held by women increasing to 28 percent (a 10 percentage point increase) and the number of female board chairs increasing to 11 percent (a 6 percentage point increase).

Asia-Pacific lags behind other regions

• At 8 percent, gender diversity in some of Asia’s leading economies is the lowest compared to other parts of the world. Only a few countries in the region have quotas or other approaches to address the issue.

About Women in the Boardroom: A Global Perspective

On behalf of Deloitte Global, MSCI ESG Research Inc. collected boardroom diversity data covering nearly 7,000 companies in 44 countries spanning Asia Pacific, the Americas, and EMEA. The data was collected as of 15 December 2016. Based on this data, the Women in the Boardroom publication includes global, regional and country analysis of the progress made towards greater board diversity. It also includes a breakdown of how well women are represented in boardrooms across 6 key industries—financial services; consumer business; technology; media, and telecommunications; manufacturing; life sciences and health care; and energy and resources. To supplement this data, Deloitte Global compiled information about diversity quotas and other board diversity initiatives from 20 additional countries. So, in total the publication explores the efforts of 64 countries to promote boardroom gender diversity. Finally, interviews were conducted with 4 directors from Australia, Japan, UK and US to provide editorial perspective about the publication findings and additional insight into how boardroom diversity is progressing in their parts of the world.

About Deloitte’s Global Center for Corporate Governance

Deloitte Touche Tohmatsu Limited Global Center for Corporate Governance brings together the knowledge and experience of Deloitte member firms around the world in the critical area of corporate governance. Its mission is to promote dialogue in the critical area of corporate governance among Deloitte practitioners, corporations and their boards of directors, investors, the accounting profession, academia, and government. Since 2009, the Global Center has launched 44 centers of corporate governance in Asia, Europe, Middle East, Africa, and the Americas. Find us online at: www.global.corpgov.deloitte.com.