AICD calls for IPO boards to add more women

Australia’s largest listed businesses have improved gender diversity in boardrooms but women are still woefully under-represented on the boards of newly listed companies.

The AICD has called on IPO companies to increase gender diversity on boards. Pictured is a pregnant woman giving a presentation to colleagues in a boardroom.

Australia’s largest listed companies have improved gender diversity in boardrooms but women are still woefully under-represented on IPO boards, according to a survey by the Australian Institute of Company Directors.

The AICD’s latest gender diversity report shows that women now make up 35.1 per cent of directors in ASX 200 companies, up from 33.7 per cent a year ago.

Gender diversity on the boards of smaller companies has also improved this year, with women now comprising 34.3 per cent of directors of ASX 300 companies, up from 32.1 per cent at the same time last year.

All bar two of the ASX 200 companies had women on their boards as at September 1, with Core Lithium and AVZ Minerals still retaining all-male boards.

All up, 131 ASX 200 companies now have boards that include at least 30 per cent women, while 181 of ASX 300 companies have reached the same target.

AICD managing director and chief executive Mark Rigotti. Picture: Hollie Adams

But companies joining the listed market are far behind. Of the 401 new ASX listings between 2019 and 2022, just 12.2 per cent of IPO board directors were women.

AICD managing director and chief executive Mark Rigotti said the lack of diversity at the IPO stage was a disappointing result that didn’t reflect the expectations of investors or the community. “We know how much gender diversity strengthens board culture and practice. Our last quarterly report highlighted the flow of new talent to the ASX 300, confirming what we know to be true – there is no shortage of qualified, board-ready women and there is simply no justification for boards to have no women at all,” Mr ­Rigotti said. “A renewed focus on IPO board composition by all involved in that process, including companies and lead managers, is required to improve the position – and we know from the progress achieved to date that focus gets results.”

The materials sector was the worst offender of the past four years, accounting for nearly half of all IPOs but just 5 per cent of women directors.

Women are typically being added to company boards in the years following their stockmarket listing, the AICD found. Companies with IPOs in 2019 had just 10.5 per cent female directors but three years later, those same companies averaged 18.7 per cent female directors.

Nicola Wakefield-Evans, the chair of Australia’s 30% Club, said companies moving from private to public markets needed to get on board and appoint more women.

“We might be making good progress at the top. But with significantly fewer women directors at initial listing, there’s clearly some greater awareness and attention required to address this and unlock the opportunity for value that greater board diversity brings.”