New research released into the diversity of ASX300 boards estimates gender parity could be achieved by 2030 if recent rates of gender diversity shifts continue, but cultural change remains a problem for the country's top companies.
The Board Diversity Index, released today by Watermark Search International and Governance Institute of Australia, put five types of diversity under the microscope, examining gender, cultural background, skills, age, and tenure and independence.
The report, which examined more than 2,000 board seats, found the number of ASX300 companies with one or no female directors had halved since 2016, as the number of women on boards surged by 60 per cent.
The report also found the number of boards with at least 30 per cent women has tripled, up to 161 in 2021 from 54 in 2016, and boards with no women have decreased from 59 in 2016 to 14 in 2021.
Governance Institute CEO Megan Motto said the rate of change on gender diversity uncovered in the Board Diversity Index is significant for Australia's boardrooms.
"On this current trajectory there will be no ASX300 companies without a female director by 2026, and gender parity achieved in the boardroom by 2030," Motto said.
"These milestones, while well-overdue, will be truly momentous and we urge companies to ensure they keep up the positive action and strategies."
Watermark Search International managing partner David Evans said while the trends on gender diversity are positive, cultural change in the boardroom is moving at a much slower pace with 90 per cent of directors of Anglo-Celtic or European background.
"The report highlights that Australian boardrooms remain dominated by those of Anglo-Celtic and European ethnicity," Evans said.
"Based on current trends, it will take 18 years for the boardroom to be reflective of Australia's cultural diversity."
According to the most recent census in 2016, seven of the 10 most common ancestries in Australia reflected a European heritage, with the others being Chinese, Indian and 'Australian' - the latter response mostly coming from, but not exclusive to, people of Anglo-Celtic origin.
The report also found that women are studying harder to reach the boardroom, outstripping men in virtually every category of qualifications.
It found 8.4 per cent of female board members have a PhD compared to 5 per cent of males, and 22.1 per cent of females have an MBA, compared to 16.9 per cent of males.
Additionally, a male director on average continues to be slightly older than his female counterpart.
The average age of directors is about 60 years, and there is a much higher proportion of women directors under 50 than men.
Motto said greater diversity is not just reflective of broader society, but it is also better for business and organisations need to pay close attention as pressure continues to build.
"We are seeing investors and other stakeholders increasing pressure on companies to be more reflective of the community within which they operate. Consumers are increasing the pressure, choosing to spend their dollars with diverse organisations which can demonstrate strong ethics and good culture," Motto said.
"Internationally, we are seeing countries list diversity as a reportable benchmark for companies and firms are starting to link executive remuneration to diversity targets. Momentum is gathering and organisations really need to be on the ball."
This latest report follows research from the University of Queensland (UQ) Business School which found the share of women on ASX200 boards rose from 8.3 per cent in 2008 to 33.6 per cent in 2021, making Australia one of just three countries to crack the 30 per cent threshold without legislated quotas.
However, the UQ team also found universal affordable childcare and gender stereotyping continued to box women out of the boardroom.
Researchers made a total of seven recommendations, including the establishment of a formal alliance of key influencers, the reinvigoration of board readiness and mentoring programs, and the adoption of a 40/40/20 target for board gender parity (40 per cent female, 40 per cent male, and 20 per cent either way).
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