Following in the West’s footsteps, India’s corporate sector has pledged to achieve 20% women in boardrooms target by 2020. Western countries have 30% women on boards to achieve gender diversity in the corporate sector. This positive initiative has been launched to promote inclusion and equality among genders.
In 2012, the percentage of women on board was 5% and it increased to 13% which is more than double of what it was then to now, that is March 31, 2017. Speaking at an event on Thursday (May 25), Sebi chairman Ajay Tyagi said that the target is aspirational but not impossible, reported TOI.
Individuals from the industry are backing this decision and raising voice against the under-representation of women in corporate boards. The current rate at which women chair companies is much lower than other countries.
“This is much lower than countries like Norway (39%), France (34%), UK (23%) and USA (21%). Only 26 boards in the Nifty 500 had three or more women directors on March 31, 2017. Fifteen companies had no female representation on boards, as compared with only six companies in the S&P 500 on March 31, 2017,” according to a report ‘Corporate India: Women on Boards’. It is a study done by Institutional Investor Advisory Services, Women on Corporate Boards Mentorship Programme and Prime Database Group to ascertain the position of women in boards.
Tyagi said, “Statistically and probabilistically, women should form 50% of the workforce. Unless one is convinced that this is really beneficial for a board, administrative measures and legislative measures are just a tick in the box and doesn’t serve the purpose.” He also pointed the grave mistake of some companies which still don’t have even one woman in their board.
“Women bring in diverse perspectives in addition to discipline to a board. They also have better sensitivity to customer issues. The stipulation of having one woman director on boards should not result in close-ended clubs with vested interests. It should be fair and equitable. We should all work in the direction of achieving 20% women representation on boards by 2020,” he said.
Zia Mody, managing partner, AZB & Partners, stressed upon the need of moving forward from having only one woman in the board. She said, “One woman on board is tokenism, we need to reach our own Club of 30%. Every woman on the board is valuable. Companies don’t need to wait for superstar women to induct them on boards,” she said.
It is optimistic to see people from both genders come forward and address the need of having gender diversity on the board. Women-friendly policies, accessible environment and flexible working hours will also add to creating a bigger space for women in board.