Although efforts have been made in the last decade to achieve gender parity in several facets of Taiwanese society, the number of women in the boardroom has yet to show progress in this regard. Our research shows that statistics regarding the percentage of female board membership in Taiwan varies greatly, ranging from as low as 4.4% to as high as 14.1% for publicly listed companies.1 Taiwan’s Financial Supervisory Commission has published statistics showing that the percentage of female board membership is slightly higher at non-listed companies, with 14.12% of seats held by women, compared to 11.48% at companies listed on the Taiwan Stock Exchange (TWSE) and 12.25% at companies listed on the Gre Tai Securities Market.2
One reason for the low percentage among publicly traded companies is the fact that the majority of these companies in Taiwan are small and medium enterprises or family businesses. These boards are typically dominated by family members and are not receptive to outside directors. However, the TWSE has recently begun a new process for evaluating corporate governance that takes into account companies’ efforts to promote gender equality on their boards (among many other factors). The release of the evaluation results will be staggered over a three-year period to reward early adopters and (eventually) shame underperformers. Only time will tell, as the full survey results are not set to be released until 2017. With luck, this incentive, combined with legislative and private efforts to promote gender equality, should increase the degree of female participation in the boardroom and more accurately reflect the efforts of these stakeholders.
Beginning in 2002 with the Gender Equality in Employment Act, the Taiwanese government has pursued a program to ensure equal rights and treatment of women in all aspects of society, including in the boardroom. The most important pieces of the 2002 law were those aimed at prohibiting discrimination on the basis of gender, eliminating sexual harassment in the workplace, and promoting equality in employment.3 This last aim was addressed through guaranteed maternity and parental leave, guaranteed child care at employers above a certain size, occupational training for employees forced to leave their jobs for family reasons, and rewards for employers who hire such individuals.4 The 2002 law also specified that damages were available to employees harmed by violations of the Act, and provided for fines against employers.5 Finally, the 2002 Act adopted the principle of non-retaliation against those who seek to invoke its protections.6
The Gender Equality in Employment Act was revised in 2007, 2011, 2013 and 2014. Notably, the 2011 amendments increased the potential fines for violation and prohibited discrimination on the basis of sexual orientation.7
In addition to these workplace protections, the Taiwanese government has undertaken several other measures to promote women’s rights.
According to the Taiwanese government, these efforts are paying off. According to its Directorate General of Budget, Accounting and Statistics, Taiwan is ranked second out of 187 countries on the Gender Inequality Index.8 This puts Taiwan ahead of other highly ranked neighbors like Japan, South Korea and Singapore, due in large part to its proportion of female legislators. It must be noted, however, that this ranking comes from Taiwan’s own self-evaluation based on the survey factors, as it was not included in the official U.N. ranking conducted by independent evaluators.9
A number of non-governmental organizations in Taiwan have been organized to promote gender equality. One in particular, Women on Boards, was founded in April 2014 with the express aim of promoting female involvement in the corporate sector and increasing the percentage of women on boards and in decision-making positions at management level.10
Similarly, the Taiwanese arm of the International Federation of Business and Professional Women has several aims, including providing a platform for business and professional women to exchange ideas and promoting gender equality.11
Many other gender-focused advocacy groups exist in Taiwan targeting a broad range of issues, from education12 to legal reform13 to employment protections.14 Outside of their primary missions, women’s advocacy groups also participate in reviews of the government’s periodic progress reports on Taiwan’s implementation of the U.N. Convention on the Elimination of Discrimination Against Women.15
In 2013, the Taiwan Stock Exchange amended its Corporate Governance Best Practice Principles to encourage listed companies to consider gender equality when appointing directors.16 The change was promulgated in response to the trend of appointing increasing percentages of female directors to the boards of international companies, as well as efforts in several leading Asian countries like Singapore and Malaysia to incorporate diversity, including gender diversity, in corporate governance standards.17
Later that year, the Financial Supervisory Commission issued its five-year Corporate Governance Roadmap. The Roadmap followed several years of corporate governance reform efforts by the Taiwanese government that produced positive results, but not at the pace of corporate governance improvements in other Asian countries. One of the Roadmap’s five overarching goals is to increase the quality and capabilities of corporate boards to ensure that they are equipped with the knowledge and professionalism needed to make strategic decisions and exercise effective oversight.18 The Roadmap outlines several recommended actions to achieve this goal, and chief among them is increasing diversity of board composition. Another of the Roadmap’s key initiatives is the development and implementation of the Corporate Governance Evaluation System. Launched in 2014 by the newly established TWSE Corporate Governance Center, the Evaluation System annually measures all listed TWSE and TPEx companies against 98 indicators,19 which are grouped into five weighted categories.20 There are 33 indicators that score companies on their efforts to enhance board composition and operation, which account for 32% of the total evaluation score.21 Two of those indicators require companies to answer whether they adopted and disclosed a board diversity policy, and whether the board of directors included at least one female director in the previous year.22
In 2015, companies ranking in the top 20% according to the Corporate Governance Evaluation System were announced publicly as a reward for their performance. In 2016, the top 50% will be announced and in 2017, all rankings will be revealed. By staggering publication of the results this way, evaluators hope to incentivize listed companies to improve their policies and board composition, including diversity and female directorship.
Despite advances for gender equality in the workplace generally, efforts to increase gender parity in the boardroom have not received the same degree of legislative intention. Instead, efforts to increase female directorships are championed primarily by non-governmental organizations and other stakeholders. While recommendations on gender equality from Taiwanese financial regulators and stakeholders are laudable, for the most part they remain just that—recommendations. Only time will tell whether these efforts, including publicizing the Corporate Governance Evaluations, will encourage different behavior. At this point, however, it seems likely that real change will come only when gender initiatives carry the force of law.