Gender diversity in corporate governance

The report explores the levels of women’s participation on boards, finding that in 2015 women occupied only 14.7% of board directorships worldwide, with this lack of gender diversity pointing to the systemic underdevelopment of valuable human capital, and reflecting a severe underutilisation of strategic leadership potential.

There has been much research investigating the characteristics and impact of women’s participation, and in spite of the significant amount of research in this area, the evidence remains mixed. However, exploration of the causes and determinants of the persistently low levels of women’s participation in corporate governance has received much less attention in the scholarly literature. As a result, much remains to be understood about the development of strategies that can more effectively support long-lasting improvements in gender diversity in boardrooms around the world.

The report finds that that certain cultural values have a significant impact on gender diversity in corporate governance, with greater gender diversity present in cultures where gender roles are less defined, and where the attitude towards gender is more egalitarian. By contrast, cultures that have a strong orientation towards hierarchy and group status tend to have less diverse boards.

In Southeast Asia, the countries that value gender egalitarianism the most are the Philippines and Singapore. Some other countries in the region, including Indonesia, have a less egalitarian orientation. These culture-based attitudes are reflected in composition of the boards of top corporations. The Philippines has the highest level of women’s participation in the region, with women comprising around 13% of directorships in its largest corporations. Indonesia, with among the least egalitarian attitudes in the region, has a women’s governance participation rate of 10%.

Efforts to improve gender diversity must incorporate initiatives aimed at parallel transformations in government policy, business practice, cultural norms, and professional standards. This requires commitment among key actors and stakeholders in government, industry, society, and the professions to align objectives and initiatives to improve women’s participation.