'One and done' attitude stalling women's advance in the boardroom

Friday, 15 November 2019

'I've been counting boardroom composition for 22 years and it has only gradually improved so that men now outnumber women by three to one,' said AUT professor Judy McGregor.

Progress towards gender and ethnic diversity in the boardroom had stalled, she said, and at the current rate of change gender parity on boards would take another decade to achieve.

The publication of the annual New Zealand Census of Women on Boards, by McGregor, barrister Cat MacLennan and Sam Stubbs from the Simplicity KiwiSaver scheme, showed the boards of the top 100 publicly listed companies were still overwhelmingly male and Pākehā.

Dr Judy McGregor SAID 76 of the Top 100 companies had diversity policies. 'In 2019, there were only eight companies for which we could not find diversity policies.'

If that didn't change male directors could expect lobbying against their re-election at company AGM's, Stubbs said.

* PwC aims for 40 per cent women in senior roles

* NZ Rugby plans to climb league table for women on boards**

The proportion of board seats held by women increased modestly to just over a quarter compared to 2018, and 10 companies had no women directors at all at the point the gender study was done.

'At this rate it will still be more than a decade before boardroom equality is a reality,' McGregor said.

Eleven of the top 100 companies had no female directors, down from 20 in 2018.

While 10 had no women directors, another 36 had only one, which raises concerns a 'one and done' approach might exist in some companies.

Simplicity founder Sam Stubbs threatened directors on the boards of the largest 49 companies listed on the NZX with action to oppose their re-election to boards unless they took action.

Simplicity Kiwisaver founder Sam Stubbs threatened action if there was no action on diversity from NZX laggards.

'Diversity is critical to KiwiSaver returns,' he said.

'Extensive research shows that if companies aren't drawing from the deepest and widest talent pool, they will underperform.'

'Last year we said that New Zealand companies have five years to fully diversify, which allows for normal board rotation. The clock is ticking. Companies should be actively implementing their diversity policies, and be complete by 2022.'

'By then we (Simplicity) expect to be significant shareholders in all of New Zealand's largest listed companies. If their governance isn't fully diversified by then, as shareholders we will start making it happen.'

It isn't only the boardroom where women were under-represented. A separate research project has found KiwiSaver funds were even more overwhelmingly controlled by men.

Each of the 265 KiwiSaver schemes had to publish quarterly updates on each of their funds, including naming the 'key personnel' who contribute to running them.

Just 151 of the 1202 named were women, said Barry Coates, founder of the Mindful Money KiwiSaver research website.

The predominance of men in fund management was likely to have been a contributing factor in how long it had taken KiwiSaver schemes to move to reflect ordinary New Zealanders' moral and ethical concerns in the investments they hold, said Coates, as women were on average more concerned to invest responsibly than men.

Stubbs believed the relative lack of women in fund management was a contributory factor in the slow gender equality gains in NZX boardrooms.

Catriona MacLennan said ethnic diversity was a big issue on NZX company boards.

There have long been concerns boardrooms were dominated by an 'old boy's network', but the researchers were concerned to see what could be the emergence of an 'old girls' network'.

'A marked feature of women's representation in the top 100 was the number of women with multiple directorships, which is a feature of boardroom composition,' the researchers concluded.

'Multiple directorships means decreased diversity, and notions of a 'girls' club' to rival the traditional 'old boys' network'.'

All the big fishes in the boardroom of New Zealand King Salmon are men.

It was not only on gender the top NZX boards were failing to reflect society.

Companies were also asked for the ethnic makeup of their boards, said MacLennan.

Only 44 replied, with most refusing to provide the requested information, citing privacy and human rights concerns.

But, MacLennan said, photos, biographies and names indicate that the boards of the top 100 NZX companies remained overwhelmingly Pākehā.

'Of Aotearoa's population, 14.9 per cent is Māori, 11.8 per cent is Asian and 7.4 per cent is Pasifika. The fact that Māori, Asian and Pasifika people are so completely under-represented on NZX's top 100 boards is an indictment,' said MacLennan.

WOMEN-FREE BOARDROOMS:

While some large companies had reached 50/50 gender split on boards (including Auckland International Airport, the a2 Milk Company, Spark New Zealand, and Summerset Group), the following companies have no female directors, the researchers said:

* CBL Corporation Ltd (insurance, but company is in Liquidation)

* CDL Investments New Zealand (a subsidiary of Millenium & Copthorne Hotels)

* Foley Wines

* JP Morgan Global Growth & Income (an investment fund)

* New Zealand King Salmon Investments

* Restaurant Brands New Zealand

* Scott Technology

* The Colonial Motor Company

* Turners Automotive Group

* Vital Healthcare Property Trust.

CORRECTION: An earlier version of this story said 11 NZX companies had no women. That number was incorrect as Augusta Capital appointed Fiona Oliver to its board on October 17 during the period in which the New Zealand Census of Women on Boards was being conducted.