WOMEN ON BOARDS – A SAFE INITIATIVE IN PAKISTAN
Women on Boards is an initiative of South Asian Federation of Exchanges, with the aim to influence a higher gender balance on corporate boards, increase women’s readiness for top management and board positions and develop economic empowerment capabilities of women professionals.
Board services today, require a more complex set of skills, experiences, and dynamic leadership styles than ever before. It is also about the combined contribution of a group of people with different perspectives, backgrounds and life styles. Diversity of thought is also essential to good corporate governance and corporate boards should reflect company stakeholders: their customers, employees, and shareholders. The best boards harvest diverse experience, skills, and perspective to obtain optimal decisions. These boards create better shareholder value. The companies which promote equal opportunities for women and have gender diversity standards for senior leadership positions are more likely to have an inclusive culture. Today, more and more corporate boards are recognizing that gender diversity is a business imperative and a critical element in sustaining successful enterprises.
A review of the largest corporations of Pakistan —which are part of the KSE-100 Index —reveals that women representation on the Boards of these companies is under 4%. These companies have a total of 35 women directors against a total population of 878 directors. This trend is similar for most other management positions held by women in the country’s corporates. Adding to this dismal representation is an extremely low participation of women in the workforce, which is about 28%, compared to almost 50% share of women in the country’s population.
Accordingly, WoB initiative is an attempt to address the acute imbalance of women professionals on the corporate boards and higher management hierarchy in Pakistan. WoB advocates increased representation of women on corporate boards and enhanced business leadership and economic empowerment opportunities for them.
MISSION & OBJECTIVES
“To address the acute imbalance of women professionals on the corporate boards and higher management hierarchy in Pakistan”
- To influence a higher gender balance on corporate boards.
- To increase women’s readiness for top management and board positions.
- To develop economic empowerment capabilities of women professionals.
SCOPE OF ACTIVITIES
- Advocacy/Lobbying for legislative and regulatory changes for gender diversity on Corporate Boards and voluntary adoption of gender diversity standards.
- WoB Clout Network for maintaining a database of qualified professional women for corporate Board positions, advising nominations and proxy solicitations, and enlist ‘W’ companies adopting voluntary gender balanced policies.
- WoB Trainings and Fellowships.
- Annual WoB and Leading Business Women conferences.
NEED FOR WoB INITIATIVE
Although there is not enough data from the developing World regarding the benefits of gender diversified Boards, however, according to one study in the US conducted by Catalyst in 2011, Fortune 500 companies with more women directors on average outperformed those with fewer women board members on a broad range of financial indicators - by 26 percent on return on invested capital and 16% on return on sales.
Another aspect to be looked at, is the influence of the "female economy". According to a study commissioned by the Global Banking Alliance for Women, and supported by McKinsey & Co., women as a population segment could be called the "biggest emerging market" in the world, surpassing India and China combined. In the U.S., women comprise about half of the workforce, hold half of all management positions, and account for 10 million majority-owned, privately-held firms. All in all, women are responsible for almost 80 percent of all consumer-spending in the World.
It is because of the above critical position held by the women in an economy that most of the developed and developing countries alike are emphasizing on increasing the participation of women in the corporate leadership positions. Some of the countries have adopted the route of parliamentary legislations to require higher quotas for women on the corporate Boards, while some have required enhanced female representations on corporate Boards through the subordinate regulations like the Code of Corporate Governance, and yet in some countries voluntary increase in the women’s representation on the Corporate Boards has been suggested for their domestically listed enterprises.
In this context the SAFE-WoB initiative is designed to serve as the grassroots campaign to raise awareness about the need for immediate corporate action to improve gender balance and make gender diversity standards as part of the redefined code of corporate governance in Pakistan. WoB aims to achieve enhanced gender balance through government policy recalibration or through voluntary, business-led measures. Under WoB campaign, SAFE shall focus on engaging the government, corporate and non-profit sectors to achieve more representation of women on the Corporate Boards, create higher professional career opportunities for women and coach and mentor them into career and director roles.
SAFE’s WoB initiative is, therefore, based on the premise that as more and more women would participate on Corporate Boards and lead companies, they would become catalysts for more women to aim for attaining higher management positions, start their own businesses, and acquire professional education. Accordingly, WoB initiative reckons that increasing the number of women in leadership positions has to be made a priority, not only because it is the right thing to do, but also because it is essential to building a high performance economy in Pakistan. WoB efforts are also needed because if the corporate boards limit their candidates from within the pool of women CEOs, then there will be only a very small pool of women CEOs who would be serving on some other boards. WoB would aim to expand the pool of eligible women from senior executive positions, women retired from government service and women business owners, as well as women from academia.
CODE OF CORPORATE GOVERNANCE REGULATIONS
- United Kingdom: The government appointed a Committee led by Lord Davies of Abersoch to review and recommend the recommended business-led approach for gender diversity standards in the quoted companiesin 2011. This Committee recommended that FTSE 100 companies should aim for a minimum of 25% representation of women on their Boards by 2015.
- United States of America: Many non-governmental organizations are working towards raising the percentage of women on corporate boards to 20% or greater by the year 2020.
- Women as a population segment are the "biggest emerging market" in the world, surpassing India and China combined. In the U.S., women comprise about half of the workforce, hold half of all management positions, and account for 10 million majority-owned, privately-held firms. All in all, women are responsible for almost 80 percent of all consumer spending in the World.
- Fortune 500 companies with more women directors on average outperformed those with fewer women board members on a broad range of financial indicators - by 26 percent on return on invested capital and 16% on return on sales
Women Representation on KSE-100 Boards
- Total No of Directors: 878
- No of Women Directors: 35 (Related 15, Unrelated 20)
- % of Women Directors: 3.99
- No of companies with Women Directors: 26
- No of Companies with Woman CEOs: 1
- Notable Companies with Maximum Women Directors
- Kohat Cement & Hum Network: 3 each
- Bannu Woolen, DG Khan Cement, FFC, Ghani Glass & Lucky Cement: 2 each
- Notable MNCs with no Women Directors: Abbot, Bata, Galaxo, Honda, Lafarge, Nestle, Toyota (Indus) & Suzuki. Only ICI Pakistan has one woman director.
Women Representation on all Publically Listed Companies
- Total No of Listed Companies: 492
- Total No of Directors: 3733
- No of Women Directors: 320 (Related 183, Unrelated 137)
- % of Women Directors: 8.5% (Related 4.9%, Unrelated 3.6%)
- No of Companies with Women Directors: 177
- No of Companies with Woman CEOs: 10
- Notable Companies with Maximum Women Directors
- Sohail Jute: 6 out of 7
- Frontier Ceramics: 5 out of 7 directors
- Al-Khair Gadoon, Arpak International, Aruj Industries, Dreamworld, Ghani Gases, JOV, Media Times, National Silk, Premier Sugar, Redco Textiles, Safa Textiles, Towllers Ltd: 4
- Ados, Al Qadir Textile, Baluchistan Wheels, Brothers Textile, Chashma Sugar, Cresent Jute, DS Textiles, ECOPACK, Ghani Value Glass, Ghazi Fabrics, Glamour Textiles, Hira Textiles, Ismail Industries, Karam Ceramics, KS Cotton, MF Textiles, Mukhtar Textile, Quetta Textiles, Sajjad Textiles, SN Textiles, Sitara Energy, Southern Electric, Thal Ind, Zephyr Textiles, Kohat Cement & Hum Network: 3 each
- MNCs with Women Directors: Unilever Foods-2, Colgate, ICI Pakistan, Jhonson & Phillips & KSB Pumps have one woman director each
- MNCs with no Women Directors: Abbot, Akzo Nobel, Bata, Galaxo, Gillette, Honda, Hinopak, Lafarge, Lindet, Lotte Chemical, Nestle, PTC, Phillip Morris, Suzuki, Sanofi Aventis, Shell, Siemens, Standard Chartered, Toyota (Indus) & Wyeth.
Get In Touch With Us
Chief Coordinator for WoB - Pakistan
South Asian Federation of Exchanges
96-W, Khyber Plaza, 2nd Floor, Fazal-ul-Haq Road, Blue Area, Islamabad-44000 | Pakistan.
Cell: +92 301 8211 079
Tel: +92 (51) 831 1283-4
Fax: +92 (51) 280 4215