Gender Diversity on Boards in the ASX300: Is Progress Occurring?

The positive implications of board-level gender diversity are well researched. Studies demonstrate repeatedly that the representation of women on boards enhances manifold aspects of company performance, from financial outcomes to corporate social responsibility. [1],[2] Aspirations for gender diversity are therefore widespread and well-reasoned beyond a gender equality basis. In line with this understanding, last May the ASX introduced a new governance guideline instating a goal of 30% women on boards. This figure, inspired by the 30% Club, reflects research which found 30% to be the point of ‘critical mass,’ whereby female board representation begins to positively influence company performance.[3]

It is encouraging to note the progress made by Australian boards in the past year in terms of female representation. The ASX200 has come tantalisingly close to achieving its 30% goal, with female representation now at 29.7% – up from 25.3% at the end of 2017.[4] The graph below shows current proportions of female board members by sector. Insurance and Food & Staples Retailing are the strongest performers, while Automobiles and Components – a traditionally male-dominated sector across all levels – lags far behind.

The (very-near) achievement of the 30% target is an important and significant step in achieving gender representation; however, a closer examination of trends across different levels of companies reveals less overall progress than this figure might suggest.

A recent study conducted by the Bankwest Curtin Economics Centre in conjunction with the Workplace Gender Equality Agency (WGEA) reveals some interesting trends. Women are progressing into management roles at a faster rate than men; if the current rate is maintained, it will take only twenty years to achieve equal representation in full-time management positions. Further up the ladder, however, the age-old glass ceiling remains unshaken. The number of female CEOs in Australia has changed very little in the past five years, with equality unlikely before next century at the current rate of change.[5]

Pay gap analysis reveals similar room for improvement, with men having higher available salaries than women at every tier of management. The highest-paid 10% of men earn on average $162,000 more annually than the highest-paid 10% of women. Rebecca Cassells, one of the authors of the study, notes that ‘simply breaking through the glass ceiling doesn’t provide women with the same wage opportunities.’[6] On a more promising note, broader pay gap analysis suggests that if current progress continues, women’s salaries should catch up to men’s in the ‘not too distant future.’[7]

Some previously noted sector trends have persisted in the past year.[8] Sectors with a strong female presence in the overall workforce, such as healthcare, retain highly unrepresentative boards. The below graph shows a trend among those three sectors with the highest proportion of women in the overall workforce; in all of these sectors, representation at executive and board levels drops sharply, suggesting the persistence of the glass ceiling.

While the overall trend of women on boards is increasing, it is important that the impetus for improving diversity does not fade. Nicola Wakefield-Evans, chair of the 30% club and a director on the Macquarie board, has noted a problem with so-called ‘diversity fatigue’ within corporate Australia – a feeling, perhaps, that enough has been done, and consequently diminishing efforts.[9] She cites investor pressure as an essential mechanism for pushing more companies to reach the 30% target.

Other initiatives companies can put in place to increase women in leadership positions include: [10]  

  • Ensuring gender pay equity
  • Providing flexible working arrangements
  • Providing employer-funded paid parental leave

In the spirit of International Women’s Day and of equality, we encourage investors to continue the push for diversity.

This article has been published in celebration of International Women’s Day 2019

Interested in discussing any of these issues further? Feel free to get in touch.

[1] Stephen Bear, Noushi Rahman and Corinne Post (2010). Journal of Business Ethics. ‘The Impact of Board Diversity and Gender Composition on Corporate Social Responsibility and Firm Reputation.’ [Accessed, 04/03/2019].

[2] Ioanna Boulouta (2012). Journal of Business Ethics. ‘Hidden Connections: The Link Between Board Gender Diversity and Corporate Social Performance.’ [Accessed, 04/03/2019].

[3] Jasmin Joecks, Kerstin Pull and Karin Vetter (2012). Journal of Business Ethics. Gender Diversity in the Boardroom and Firm Performance: What Exactly Constitutes a “Critical Mass?” [Accessed, 04/03/2019].

[4] Australian Institute of Company Directors, 30% by 2018: Gender diversity progress report (2017): [Accessed, 03/03/2019].

[5] Bankwest Curtin Economics Centre and Workplace Gender Equality Agency, Gender Equity Insights 2019: Breaking Through the Glass Ceiling (2019). [Accessed, 03/03/2019].

[6] David Marin-Guzman, ‘Female CEOs won’t achieve equal representation until 2100,’ Australian Financial Review (28 February 2019): [Accessed, 03/03/2019].

[7] Bankwest Curtin Economics Centre and Workplace Gender Equality Agency, ibid.

[8] Centre for Australian Ethical Research, Women in the Workforce: An Analysis of Global Business Sectors (2018): [Accessed, 03/03/2019].

[9] Nassim Khadeem, ‘Coalition ‘not in step with society’, needs gender-based quotas: lobby group,’ ABC (5 March 2019): [Accessed, 03/03/2019].

[10] Bankwest Curtin Economics Centre and Workplace Gender Equality Agency, ibid.

Emily Faithfull

Author: Emily Faithfull