The 2022 Board Diversity Index, a survey by the Governance Institute of Australia and executive search firm Watermark Search International, found that of the 2053 seats in the ASX300:
- 667 (32.5%) are occupied by women; and
- 144 (7%) have an ethnicity other than Anglo-Celtic or European.
“With the 30% Club milestone conquered, the next target – set by Women on Boards – is 40:40:20. Along the way, there may well be no ASX 300 boards without a female director by 2026, as we predicted in our last survey. Progress in the other dimensions of diversity covered in our survey continues to be, however, patchy and unconvincing.” (pg. 9)
The survey provided a snapshot of the diversity in boardrooms of the ASX300 in 2021/2022, examining five types of diversity: gender, cultural background, skills/experience, age, and tenure & independence.
Watermark Search International Managing Partner David Evans said while it was good news that the number of women on boards was rising, cultural diversity is an area in need of “serious attention”.
“Cultural diversity in the boardroom is currently stagnating with our boards continuing to be dominated by those of Anglo-Celtic and European ethnicity. Given Australia is increasingly multicultural, this is an indicator that our boardrooms are becoming less representative of our communities,” Evans said.
The report found that a typical Australian public company board member had the following characteristics:
- Aged 60
- Resident in Australia
- Degree qualified with possibly an MBA
- Steeped in accounting/finance/banking
- Independent of the executive team
- In his fifth year on the board
Claire Braund, Executive Director of Women on Boards said this was a reminder that the boardrooms of Australia are still dominated by white Anglo or Euro-centric men or, where women are present, white Anglo or Euro-centric women.
“The strong shift towards improved gender balance in the boardroom since Women on Boards opened its doors in 2006 is positive, but we need to be mindful of intersectional diversity and not inadvertently replicate the all-male white boardrooms we worked hard to break down with boardrooms of all-white women with a background in finance or law,” Braund said.
The lack of cultural diversity may have something to do with the predominant skills on boards with the report finding that; “women lawyers are commonplace on boards but continue to be significantly under-represented in property, engineering/manufacturing, education and agribusiness. There are significantly more women experts in consulting and HR, both of which have miniscule representation at board level.”
Women on Boards Cultural Diversity Committee Chair, Mahjabeen Zaman, said while the figures are concerning, there is also an issue around how cultural data is measured.
The key thing that we are seeing from both the methodology in this survey and our own experience collecting cultural data, is that Board Cultural Diversity is very hard to measure because there is no consistent agreed definition and many directors don’t specify their culture, making measurement judgement based and imprecise.
Other findings from the 2022 Board Diversity Index:
- Fewer directors hold more seats: 19% of female directors hold 48% of female-occupied seats, reversing the gains of last year when 29% of women directors held about 51% of female-occupied board seats
- Directors are getting older: The number of those over 70 years has increased from 16% to 22%
- There is a higher proportion of women directors with additional qualifications: PhDs, governance qualifications and master's degrees in particular
- Tenure is changing: This year for the first time there are female directors with 15+ years tenure.
Read the 2022 Board Diversity Index report here
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Women on Boards: Spotlight on Cultural Diversity Series