Will ASX ‘Recommendation 2.2’ help get more women on Boards?

Brand Audits Update x Christine Moody*

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The Australian Institute of Company Directors (AICD) held a Directors’ Briefing last night at Clayton Utz—‘Balancing the skills matrix: Skills based board structures’—presented by Dr Sally Pitkin, Company Director and AICD State President; Andrew Hay, Partner, Clayton Utz; and Bruce Elliott, Senior Client Partner, Korn Ferry. This briefing is in response to the Australian Stock Exchange’s (ASX) Recommentation 2.2.
 
A listed entity should have and disclose a board skills matrix setting out the mix of skills and diversity that the board currently has or is looking to achieve in its membership.
 
This recommendation will see the 2014/15 Annual Reports with a skills and experience table which list the ‘skills and experience’ and the number of Directors that have those skills. This includes the report on the number of women on the Board. An example presented last night was from Downer EDI Limited’s Annual Report 2015. As well as the standard report content, this year’s report has bar charts and pie charts in the corporate governance section (page 116 of a 124-page report). This is a great start and shows at a glance the gender diversity of the board. The gender diversity pie graph could have been improved by including the percentage breakdown of males to females but it is clear that they are well and truly on their way to a gender balanced Board.
 
By having more disclosure—especially gender diversity—will let shareholders and other stakeholders (particularly employees and potential employees) where the company sits presently and what their future plans are. Boards are now open to questions from shareholders as to why they have not addressed gender diversity and what thay are doing about the situation. While the number of women on Boards is increasing, it has slowed since 2013. Women still only represent one in five (20 percent) Directors in ASX-200 companies. Companies are not only missing out on a diverse and well-rounded Board but also risk damaging their brand. Forward thinking companies such as Westpac Group, have already put in place measures and initiatives to address the diversity issues and report against their initatives. This is what great brands do. 
 
Time will tell if ‘Recommendation 2.2’ makes a difference to the number of women on Boards. As the reporting season is in full swing, it will be worth noting how companies are responding. Do you think this recommendation will see more women on Boards? 

*Christine Moody is one of Australia’s leading brand strategists and the founder brand management consultancy, Brand Audits. With more than 30 years’ professional experience, Christine has helped a diverse client base of local and international brands, including Gold Coast City Council, Hilton Hotels, and Wrigleys USA, to develop, protect and achieve brand differentiation.

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