Australian companies lead the way when it comes to women’s share of executive roles. As of August 31, 2018, the percentage of women on ASX 200 boards was 28.5%.1 Additionally, women have comprised 50% of new appointments to ASX 200 boards to date in 2018.2 This is a significant increase from 2008 when women comprised only 8% of new appointments.3 This recent progress can be attributed not to legislation or quotas, but to other initiatives implemented by government and non-governmental bodies in the past 10 years.
While there are no mandatory quotas, rules or guidelines, the Australian government has made efforts toward enhancing board diversity. In 2012, the Australian government passed The Workplace Gender Equality Act which requires non-public sector employers with 100 or more employees to provide to the Workplace Gender Equality Agency (WGEA) a detailed annual report about gender balance, including information on the gender composition of the workforce and the governing bodies of relevant employers.4 This reporting framework aims to encourage measures that improve gender equality outcomes, while minimizing the regulatory burden on Australian businesses.
The Australian government has also sought to lead by example by ensuring gender diversity on its own boards. In 2010, for example, the Australian government set a target to have a minimum of 40% women on Australian government boards by 2015.5 After successfully reaching that goal, the government then increased its target for female representation across all Australian government boards to 50% in 2016.6 According to the latest figures, the percentage of women on Australian government boards is 42.7% as of December 2017.7 This is the highest percentage of women reported on government boards since the Australian government began tracking such figures in 2010.8
Both the Australian Securities Exchange (ASX) and the Australian Institute of Company Directors (AICD) have signalled to Australian companies that they expect action on gender diversity. For example, in 2010 the ASX amended its Corporate Governance Principles and Recommendations to include provisions relating to the reporting of diversity (“the Diversity Recommendations”).9 The key elements of the Diversity Recommendations ask that listed companies establish and disclose a board diversity policy that includes establishment, review, and reporting of measurable objectives that apply across organizations, including senior executive and board positions10 The ASX takes an “if not then why not” approach, requiring ASX-listed companies to report on their progress in setting policies and achieving objectives, or to explain why they have elected not to do so.11 Recently, the ASX Corporate Governance Council proposed guidelines to be included in the fourth edition of the ASX Corporate Governance Council Principles and Recommendations that would require each entity listed on the ASX 300 to achieve not less than 30% gender diversity in the composition of its board.12 It is yet to be seen whether such guidelines will be adopted and enforced moving forward.
Public Advocacy Efforts
The Australian Institute of Company Directors —an Australian organization committed to impacting society and the economy through governance education, director development and advocacy—has also called on boards to embrace the need for change. In 2015, the AICD announced a voluntary target of 30 percent for women serving on all boards, and indicated that ASX 200 companies should reach this target by 2018. As of April 2018, 82 ASX 200 companies have reached the 30% target.13 Although there are still five companies without any female directors and 87 companies that need at least one female board member to achieve 30% female representation, these statistics mark a “significant lift” from board appointments in previous years.14 Emboldened by these trends, AICD has just recently set the bar even higher: AICD now calls on all boards making an appointment to have at least a 50/50 candidate list for consideration.15
ConclusionSignificant progress has been made in Australia to date, and many other countries look to successes in Australia as an example of what they would like to achieve. In April 2018, for the first time in Australia, more women than men were appointed to the boards of Australia’s top 200 companies (ASX 200),16 an encouraging sign for Australia’s efforts to reach gender parity. AICD chair Elizabeth Proust remarked of the recent numbers: “When it comes to increasing gender diversity on Australia’s largest boards, we know that it’s never been a supply problem, it’s been a demand problem... what today’s figures hopefully show is that, finally, we are seeing the demand.”17 However, she cautioned, “[to]day’s figures aren’t a sign that it’s time to take the foot off the brake” and that “[g]reater gender diversity on our boards is crucial to the future of good governance in this country.”18