World Women’s Day: Aussie supers call for board diversity while Pax and Mercy hail engagement a success

Updates on female board membership, gender lens investing and financial inclusion for women

The Australian Council of Superannuation Investors (ACSI) has called for companies to improve their board gender diversity to 30% women. ACSI CEO Louise Davidson said: “On a day which celebrates women’s social, economic, cultural and political achievements, my question to companies is: ‘What message does your board’s composition send about your attitude to gender equality?’”
Pax World Funds and Mercy Investment Services have announced the success of a shareholder engagement with US Foods Holdings (US Foods), after calling for the company to make improvements to its gender diversity. In November 2017, at a time when US Foods had no women on its board, sustainable investors Pax and Mercy co-filed a proposal for US Foods to improve its board diversity policies and take steps to diversify its board of directors. Pax and Mercy withdrew the proposal after the board amended its corporate governance guidelines to say they would seek out women and individuals from minority groups and diverse backgrounds in the director search process, and Ann Ziegler joined the board in January. Susan Makos, Mercy’s Vice President of Social Responsibility, said: “We applaud US Foods for listening to shareholders’ concerns and recognising that a more diverse board of directors better represents the customers it serves and will benefit the company in the long run.”
Company governance remains a male-dominated field, with a Vigeo Eiris study finding that women represented less than one fifth of board and executive level positions worldwide in 2016. The study, which looked at 3800 listed companies across 41 sectors and 60 countries, found that just 18% directors and 16% of executives were women. European companies had the highest percentage of female directors, at 24%, while North American companies had the highest rate of female executives at 17%. Female executives in Asia Pacific and Emerging Market countries came in at 10% and 12%, respectively. The study also rates the companies’ commitments to prevent gender discrimination and advance gender diversity.
In another report on the topic, this time by Thomson Reuters, women were found to represent just 12.5% of executives and 16.8% of board members in 2016, up from 10.6% and 10.3% respectively in 2011. The report draws on ESG data about women in leadership and gender diversity globally. EU members account for the top four spots for representation of women on boards, on the back of recent changes in gender diversity regulations in member states such as France, which in 2011 mandated large companies to dedicate 40% of boardroom positions to women by 2016.
Companies with more diverse boards as well as strong ‘talent management’ practices enjoy higher growth in employee productivity than companies with just one of these factors, research by index provider MSCI has shown. MSCI’s latest research, “Women on Boards and the Human Capital Connection” revealed that companies with a combination of leading talent management practices and 3+ female directors over a period of three years experienced growth in employee productivity averaging 1.2% above the industry average. Employee productivity in companies with mostly male boards and weaker talent management practices, on the other hand, underperformed by an average of 1.2%.
Women’s leadership is key to delivering long-term sustainable growth, the Business and Sustainable Development Commission argues in its new report entitled Better Leadership, Better World. The Commission highlights women’s proficiency in advancing corporate openness and inclusiveness, as well as acting on mitigation of climate and environmental risks, which it says will be crucial for success in global markets in the next 15 years.Alberta companies are lagging behind the rest of Canada in terms of senior level gender diversity, new research from the Shareholder Association for Research and Education (SHARE) has shown. According to the study, looking at the year 2016-17, the percentage of Alberta-incorporated companies on the TSX Composite Index with all male boards (25%) was almost triple that of other companies on the index (9.2%). The percentage of women in executive positions in Alberta companies declined, while the rest of the TSX Composite reported improvements. With “regulatory impediments” stopping most shareholders filing AGM resolutions at companies incorporated under the Alberta Business Corporations Act (ABCA), no gender diversity proposals have ever been filed or voted with Alberta-incorporated companies. Delaney Greig, Engagement Analyst with SHARE, said: “A simple amendment to the ABCA regulations would allow shareholders to engage with the Alberta-incorporated companies they own about gender diversity in the same way they can everywhere else in North America.”
Women on average have less than half as much as men in workplace pension schemes (£53,000 vs £120,000), research from Close Brothers Asset Management and the Pension and Lifetime Savings Association (PLSA) has revealed. Other key findings from the Lifetime Savings Challenge Report include that 51% of female (compared to 35% male) employees feel financially unprepared for retirement, and that women are twice as likely to have under £5000 in savings.
The IMF’s latest report “What is Driving Women’s Financial Inclusion Across Countries?” has further confirmed that women disproportionately suffer financial exclusion. Legal discrimination, lack of protection from harassment within and outside of the workplace, and more diffuse gender norms are cited as possible explanations for the trend.
The Canadian Audit and Accountability Foundation, in collaboration with Women Deliver and the International Institute for Sustainable Development, have released their Practice Guide to Auditing the UN Sustainable Development Goals. The tool, aimed at the public sector, offers a methodology for auditing gender equality, and is intended to accelerate the help alignment with the 17 SDGs
More than 50 stock exchanges throughout the world hosted a bell ringing ceremony this morning to mark International Women’s Day. The events are intended to raise awareness of how the private sector can play a key role in furthering gender equality, in line with the UN’s fifth Sustainable Development Goal.
Women investors in the UK and Europe are much more likely than male investors to invest in companies with female founders, a study led by the UK Business Angels Association (UKBAA) and supported by the European Commission has found. The study, which spoke to 640 “sophisticated” and high net worth women across six countries, found that 54% of female – but “only a few” male investors – have invested in at least one female-founded company. 96% of women investors questioned said that their financial advisors fail to mention angel investing as an investment option for them, focusing on “safe” options such as stocks and shares.
Five out of six UK companies have so far failed to submit their gender pay gap data, with a month to go before the deadline, the Financial Times has reported. 1442 of an estimated 9000 employers had reported their data to the government by midday on Friday. A fifth of these were public sector employers, whose median gender pay gap was 13.3%, while private companies reported a 7.3% pay gap. A third of the FTSE 100 and less than a tenth of the FTSE 250 have reported so far. Of those reported, the median pay gap reported is 12.6%. This is the first year that employers of more than 250 staff have to report the gap between what their female and male employees are paid.