Diversity push comes to ASX mid-market

Chairs of mid-market ASX-listed companies are under increasing pressure to appoint more women to their boards.

D I I V SI TY

Chairs of mid-market ASX-listed companies are under increasing pressure to appoint more women to their boards, according to a report to be released on Tuesday by KPMG and the 30% Club.

“We now have strong female representation on boards across the ASX 100,” KPMG Australia chairman Alison Kitchen says in the report.

“We are genuinely approaching equality of representation at the top end of town.”

But she said there was much more to be done in appointing women to the boards of companies below the ASX 200 level.

While women make up 31.8 per cent of boards of ASX 100 companies and 30.7 per cent of ASX 200 companies, they only make up 22 per cent of the boards of companies in the ASX 201 to 300 range, the report says.

While a quarter of the businesses in this range had achieved the 30 per cent level of female board membership, some 23 per cent had no female board membership at all. “It is encouraging that the ASX 200 has now reached the 30 per cent target which was set some years ago,” Nicola Wakefield Evans, chair of the 30% Club of Australia, said releasing the report.

“But at the tier just below there is still a long way to go.”

She said the 30 per cent level was recognised as the “tipping point” which could change the dynamic of board room discussions. And there was a strong correlation between greater board room diversity and a “better business performance”.

Ms Wakefield Evans said the 30% Club’s goal was now to focus on companies below the ASX 200 level, particularly those from ASX 200 to ASX 300.

She said directors of mid level ASX companies should learn from larger companies how they were able to recruit and appoint more women to their boards. “The lessons of the top ASX listed companies show the importance of leadership, particularly from the chair of the board. “It is not necessarily the gender of the chair but the chair’s commitment to push for diversity and their ability to achieve outcomes.”

She said the boards of smaller companies needed to be aware that major investors including superannuation finds and other groups were now taking a much more proactive approach to encouraging companies to appoint more women on boards.

Ms Evans said more work needed to be done to develop a pipeline of qualified women who could be considered for company boards including those in the below ASX 200 range.

The report urges the chairs of companies in the below ASX 200 range to follow the lead of those in bigger companies who have been proactive in recruiting more female non executive directors.

“It is the role of the chair to set diversity as a priority at the board and company level,” the report says. “They can do this through creating an inclusive boardroom environment, ensuring the board itself is diverse and setting the tone that diversity and inclusion is important to the organisation.”

It warns that “without the chair’s commitment to and belief in the benefits of diversity and inclusion, progress will be difficult to achieve.”

The report says many ASX 100 chairs have been “highly engaged in the diversity conversation and have shown to continually prioritise it within their boards and organisations”. “It is critical that chairs within the ASX 201-300 show a similar desire to educate themselves on the benefits of diversity and set an intent to continually improve gender diversity on their boards.” The report shows the lack of women on boards of companies in the ASX 201 to 300 range is most acute in areas of information technology, industrial companies, materials and energy companies.