Board succession planning hinders diversity efforts

image
image
expand image

Two-thirds of ASX 200 boards say they “always or sometimes” gravitate towards candidates who are known to board members when selecting new directors, hindering efforts to achieve gender diversity on boards, according to a survey by the 30% Club.

Directors who responded to the survey said it was easier to work with someone who was known to board members and who had established reputation in the market.

Susan Oliver, 30% Club Steering Committee member, said given the current small percentage of directors who are female, this leads to a “catch 22” situation for women.

“…Fewer females are known to directors, and this reduces the likelihood that females will be selected,” said Oliver.

Only 6.5 per of respondents sought outside advice on succession planning, and only 10.2 per cent of respondents cited the need for enhanced board diversity.

“The challenge in achieving gender equity is not one of supply but continues to be one of demand, with insufficient numbers of boards perceiving gender diversity as a strategy imperative,” said Oliver. “When chairs place too high a value on ‘collegiality and teamwork’, it can be sued as a code for ‘being like us’ and limit the opportunity for injecting innovative and diverse thinking.”

The Club posited that good succession should be based on skills, diversity and planning for the future rather than replacing like with like.

Other practices that hindered diversity efforts were the adherence to a de-facto fixed term for directors of nine or 10 years, as well as highly specific experience briefs.

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest news and developments in wealth management industry

MARKET INSIGHTS

GG

So shareholders lose a dividend plus have seen the erosion of value. Qantas decides to clawback remuneration from Alan ...

2 months 1 week ago
Denise Baker

This is why I left my last position. There was no interest in giving the client quality time, it was all about bumping ...

2 months 1 week ago
gonski

So the Hayne Royal Commission has left us with this. What a sad day for the financial planning industry. Clearly most ...

2 months 1 week ago

A Sydney-based financial adviser has been banned from providing financial services in the interest of consumer protection after failing to act on conduct concerns. ...

3 weeks 5 days ago

Insignia Financial has made four appointments, including three who have joined from TAL, to lead strategy and innovation in its retirement solutions for the MLC brand....

18 hours ago

ASIC has cancelled the AFSL of a $250 million Sydney fund manager, one of two AFSL cancellations announced by the corporate regulator....

3 weeks 3 days ago