In Pakistan, women comprise just 22% of the workforce.1 Recent changes in Pakistani law signify a shift toward granting women greater rights and freedoms and increasing gender parity.2 The country now has an 18% quota for female representation in the national parliament3 and a 22% quota for municipal councils.4 Further, the legal age of marriage has been set at 18 for men and women.5
Despite these broader changes, as of 2017 only 6.4% of publically listed companies had a woman on their board and only 31 of the Karachi Stock Exchange (KSE) 100 index companies had a female director. Those numbers are in comparison to the fact that women make up 17.2% of parliament,6 22% of the workforce, and 49% of the total population.7
The Constitution of the Islamic Republic of Pakistan guarantees citizens’ equality under the law and prohibits discrimination on the basis of sex, specifically providing that “[a]ll citizens are equal before law and are entitled to equal protection of law” and that “there shall be no discrimination on the basis of sex.”8 In 2017, the Code of Corporate Governance was amended through the Act to Reform and Re-enact the Law Relating to Companies and for Matters Connected Therewith (“Companies Act”). Part of the Companies Act required every public interest company to have at least one female director within three years.9 There is no formal quota for female representation on corporate boards.
The Securities and Exchange Commission of Pakistan (SECP) predicts that the new Companies Act will more than double the representation of female corporate directors, from 6.4% to at least 14.3% by 2020. SECP also acknowledged the studies conducted in other countries that discuss the benefits of female participation in corporate boards.10 Although the law took effect in 2017, the lack of publicly available information regarding gender diversity on boards makes it hard to judge the effect the Companies Act has had to date in Pakistan.
Women in Pakistan still face barriers to entering the workforce and the C-suite, not to mention the legal restrictions on a woman’s access to inheritance and credit and their property rights. Additionally, women do not have the same type of access as men to apply for a passport, register a business, or get a national identity card.11 Further, as noted in our last report, women on corporate boards in the country largely serve on the boards of companies owned by family members, suggesting that breaking the glass ceiling in Pakistan requires bypassing the traditional path in favor of a familial connection.12
Still, several organizations, both within the country and internationally, are working toward increasing female presence in the economic sphere in Pakistan. The Pakistan Institute of Corporate Governance (PICG), for instance, is a non-profit organization focused on promoting stronger corporate governance by providing training and other support to corporate directors. As part of its programming, PICG has a specific leadership training program focused on women directors. Additionally, chambers of commerce focused on female business interests have developed across the nation, including the Women Chamber of Commerce and Industry Peshawar Division. On the international front, the U.S. State Department and American University launched an initiative in 2012 in partnership with public and private stakeholders in the U.S. and Pakistan. That initiative, the U.S.-Pakistan Women’s Council, seeks to increase participation by women in the Pakistani economy through employment and entrepreneurial and educational training and access.
The issue of diversity within corporate boards has gained some interest in Pakistan in recent years. Most notable is the new Companies Act, which now requires certain companies to have at least one woman on their boards. The business case for female inclusion within corporate boards has also become more mainstream. However, legal and cultural barriers remain for women joining the workforce in Pakistan.
3 Constitution of Islamic Republic of Pakistan, art. 51.
4 Sindh Local Government Act, art. 18.
5 World Bank, supra note 1.
6 SECP regulation: Women directors to more than double in three years, Sec. Exch. Comm’n Pak. (July 8, 2017), https://www.secp.gov.pk/wp-content/uploads/2017/07/Press-Release-July-8-Women-directors-in-Pakistan.pdf.
7 World Bank, supra note 1.
8 Constitution of the Islamic Republic of Pakistan, art. 25(1)-(2).
9 Companies Act § 154. (2017).
10 Sec. Exch. Comm’n Pak., supra note 6.
11 World Bank, supra note 1.
12 Gender Diversity on Pakistan’s Corporate Boards, Center for Int’l Private Enterprise (July 22, 2015), https://www.cipe.org/blog/2015/07/22/gender-diversity-on-pakistans-corporate-boards/.