Women hold 17.1 percent of the seats in a boardroom in India, up from 9.4 percent in 2014. Though more women are donning leadership roles, their representation in company board is still low even after the Companies Act 2013 mandated having at least one woman member in a board, says the seventh edition of Deloitte Global’s Women in the Boardroom report.
The report says that only 3.6 percent of the top chairs in a boardroom are occupied by women, down by 0.9 percent since 2018.
On the global stage, 19.7 percent of the board seats are held by women, an increase of 2.8 percent since 2018 compared with 1.9 percent over 2016-2018. At this pace, the world could expect to reach near-parity only in 2045, says the report.
Austria, Canada, Ireland, Italy, Poland, Portugal, Spain, the United Kingdom, and the United States saw the most notable increases.
Leadership positions
The report says that India still has much ground to cover in terms of women heading boards, it witnessed an increase in the number of women taking up CEO roles − 4.7 percent female CEOs against 3.4 percent reported in 2018.
Deloitte Global’s research revealed a positive correlation between appointing a female CEO and the diversity on the board. Globally, companies with women CEOs have significantly more women on their boards than those run by men − 33.5 percent vs. 19.4 percent, respectively. The statistics are similar for companies with female chairpersons (30.8 percent women on boards vs. 19.4 percent, respectively).
The inverse is true as well − gender-diverse boards are more likely to appoint a female CEO and board chair.
“While the Indian regulators have set up a holistic framework to encourage the representation of women in key positions in corporate houses, the numbers suggest a significant gap between the ideated measures and ground realities. With the continuing disruption and the current pace of change, the case for diverse boards that work with a unified purpose is becoming stronger than it ever was,” saysAtul Dhawan, Chairperson, Deloitte India.
The stretch factor
Fewer women are serving on more boards. Deloitte Global’s stretch factor metric examines how many board seats an individual holds in a particular market. The higher the stretch factor, the greater the number of board seats the same director occupies in each market.
In 2021, the stretch factor for women increased slightly from the 2018 figure of 1.22 to 1.30 in India. It indicates that compared with men, a smaller group of women are taking on many more board seats. Men, by comparison, have a stretch factor of 1.20. The countries with the highest stretch factor for women—Australia (1.43), the US (1.33), and New Zealand (1.32)—have eschewed quotas in favour of voluntary approaches, such as non-binding targets. Meanwhile, the European countries that were early adopters of quotas have much lower stretch factors for women directors; in some cases, the factor was equal to that of men globally. In India, the average tenure of women directors marginally increased from five years in 2018 to 5.1 years in 2021. Globally, the number decreased from 5.5 years in 2018 to 5.1 years in 2021, especially in markets, such as the US (from 6.3 years in 2018 to 5.3 years in 2021), the UK (4.1 years to 3.6 years in 2021), and Canada (5.7 years to 5.2 years).
The report highlights that nearly all countries have local organisations or governments committed to increasing the number of women serving on company boards. The latest edition of the report includes updates from 72 countries on representation of women in the boardroom, deciphering the political, social, and legislative trends behind these numbers.
