Look at some conference speaker lineups and you’d think more than half the population were wearing invisibility cloaks. This may be changing, but not quickly enough. All companies, and the super funds than invest in them, should demand diversity to ensure better business outcomes.
It might almost be funny if it wasn’t so insidiously pervasive, and so perfectly summed up by Paypal’s now notorious all-male gender diversity panel.
Just the sight of the flyer, with its five male participants promising to discuss “how men and women can co-partner to achieve a better workplace” sent howls through cyberspace. It prompted some of Australia’s top male conference speakers to pledge to boycott all-male panels, and the re-emergence of “Female Conference Speaker Bingo”.
This handy cut-out-and-keep bingo card lets you check all the excuses presented about the lack of female speakers at events – “there aren’t enough qualified women speakers”, “both women we called were booked that weekend” and “women are shy”. The usual.
At ACSI we have just held our Annual Conference. Our attendance numbers were the highest they’ve been in years. The sessions were topical and the panelists’ insights incisive, thoughtful and knowledgeable. The audience was engaged and positive.
We had 13 speakers throughout the day. As it turned out, 10 were women. All were experts in their field, none hard to find or convince to participate.
As with conference speakers, so too with company boards. The old excuses don’t wash anymore. It’s well past the time that more female voices were heard in the boardrooms of Australia.
ACSI wants 30 per cent female representation on company boards by 2017. Research and experience has shown that once any group reaches a critical mass – generally considered to be 30 per cent – it becomes effective in challenging potential or existing groupthink.
When we launched that policy in 2015, we wrote to all the companies in the ASX200 with either one woman, or no women, on their boards. I was literally astonished to find I had to sign nearly 100 letters.
Back then, women occupied 19 per cent of board seats and only one in every four board appointments went to women. And that was after five years of ACSI engaging with companies in an attempt to get them to seriously consider the gender make-up of their boards.
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Consequences of “inaction” severe
I said at the time, for those five years: “our members have been the very definition of ‘patient capital’. They may not remain that way on this subject.” With that in mind, we decided that in 2017 if a company wouldn’t engage with us on the subject, hadn’t acted, or couldn’t say when it planned to act, we would recommend a vote against their directors at their AGM.
The numbers have improved since then. Big companies are leading the way, with women making up 28 per cent per cent of the ASX50 company boards. That slips a fraction to 27 per cent of the ASX100 and again to 23 per cent of the ASX200 (as at the end of April 2016).
Yet there are still two companies in the ASX100 and another 18 in the ASX200 with no female directors. 63 companies have just one. Only a quarter of the ASX200 have reached the 30 per cent target, though some are on the cusp.
Perhaps 2016 might be the tipping point. In the first three months of this year, women made up 45 per cent of new board appointments, and we can only hope that trend continues. Some boards have made it to a 50-50 gender representation, and Medibank Private started with more female directors than male.
ACSI is dedicated to helping our member super funds manage ESG risk and thereby improve the long-term sustainability of their investments – which are the retirement savings of millions of Australians.
We know that skilled and diverse boards make for better-governed companies, which in turn leads to better long-term investment outcomes. There’s a myriad of research from McKinsey and Credit Suisse, among others, which indicates firms with greater gender diversity are more likely to outperform their industry peers.
Why would a company not find that appealing? Worth striving for? That’s just one of the reasons the slow appointment of female directors is baffling.
It’s time that invisibility cloak was put back in the cupboard for good.
Louise Davidson is the chief executive officer of the Australian Council of Superannuation Investors (ACSI)