Nicola Wakefield Evans

The 30% Club Australia, a leading organisation campaigning for 30% women on ASX boards, has announced new targets for ASX 201- 300 companies to meet the 30% target by the end of 2021 to mark International Women’s Day.

Previously only ASX 200 companies were targeted to meet the voluntary target by the 30% Club.

“This is an amazing achievement as Australia is the first country in the OECD region to achieve significant targets without regulatory intervention, ahead of UK, US and Canada. It’s been proven that gender diversity can be reached without quotas and intervention as long as there are passionate advocates for diversity across ASX Chairs and Directors,” said Nicola Wakefield Evans, Chair 30% Club.

Last year was a watermark point for corporate Australia as for the first-time women accounted for more than 30% of board positions across ASX 50 (32.7%) and ASX 100 (31.3%).

“However, the number of female company directors for the ASX201-300 stood at 19.7 per cent, with still 28 companies with no females on their boards.

“So, in a way the hard work is just beginning as the 30% Club increases its advocacy.  We have set up a new Investment Banking/Private Equity Working Group to seek greater support from business and the investment community, and to increase their contribution towards building gender diverse boards.

“The community at large expects the composition of boards to reflect the broader Australian population. I believe the time is right to look beyond ASX 200 companies to also include the small cap companies sector,” notes Ms Wakefield Evans.

Susan Roberts, Head of Investor Working Group 30% Club added: “We will continue to work closely with investors from the investment management sector and Australian super funds to focus on achieving diversity on ASX300 Boards.

“Large super funds and fund managers are leading the way in advocating for gender diversity, based on the belief that companies that are well governed and sustainable will deliver positive results over the long term” says Ms Roberts.

The latest Australian Institute of Company Directors (AICD) gender diversity figures show women now make up 29.7 per cent of all ASX200 board positions, an increase of over 10 percentage points since the target was set in 2015.

There are still three boards in the top ASX200 with no women on their boards: ARB Corporation, Emeco Holdings and TPG Telecom. And there are 50 boards on the ASX200 with only one woman on their board.

The 30% Club in Australia was established in May 2015. The first three years of the Club’s establishment in Australia have been a period of intense activity with the signing on of 95 Chair members, 14 signatories to the investors’ Statement of Intent, growth in participation of women on ASX companies’ boards, and the engagement of the Australian Institute of Company Directors (AICD) as the secretariat support for the 30% Club in Australia.

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Nicola Wakefield Evans

The 30% Club Australia, a leading organisation campaigning for 30% women on ASX 200 boards by the end of 2018, has announced the appointment of Ms. Nicola Wakefield Evans to the position of Chair, effective 1 July 2018, replacing Patricia Cross who will stand down on 30 June 2018.

After several years of incubation, Patricia Cross founded the 30% Club in Australia, with its formal launch in May 2015.

The first three years of the Club’s establishment in Australia have been a period of intense activity with the signing on of 95 Chair members, 14 signatories to the investors’ Statement of Intent, growth in participation of women on ASX 200 companies from 19.4% of board seats to 27.7% today, and the engagement of the Australian Institute of Company Directors (AICD) as the secretariat support for the 30% Club in Australia.

The latest figures from AICD reveal that for the first-time women account for 30% of board positions across ASX 100 companies and that this is ahead of UK, US and Canada (which are 28.9%, 23.6% and 20.6% respectively).

“We’ve made significant progress in Australia to date, but in a way the hard work is just beginning as the 30% Club will begin to increase its own advocacy.  I’m excited about handing the reins over to Nicola, as she is a passionate advocate for diversity, a highly engaged member of our 30% Club Australia Steering Committee, and as well as a director of our vital stakeholder- the AICD,” notes Ms Cross.

“I am thankful for the tremendous support we have received since founding from key stakeholders such as the AICD, KPMG, Shed Connect, Macquarie, Bloomberg and the ANZ.  The support of these organisations has been enthusiastic from the very top down all the way through.  I also want to express my gratitude to Ownership Matters and the Australian Council of Superannuation Investors for their thought leadership on this subject, both to me and to the broader business community.”

“We are all especially appreciative of the support from so many leading ASX company Chairs.  It wouldn’t happen without you,” says Ms Cross.

Nicola Wakefield Evans comes to her new role with a wealth of professional, corporate and advocacy experience.

She is a non-executive director of Macquarie Group, Lendlease Corporation, Bupa Australia & New Zealand and the Clean Energy Finance Corporation.

She was a partner of King & Wood Mallesons for over 20 years, before retiring from the partnership in 2013.

She has a long-standing commitment to gender diversity, including being on the board of Chief Executive Women. She sits on the national board of the Australian Institute of Company Directors and she has been involved in the 30% Club since its formation

She has been a regular contributor to debates on such issues as extending childcare hours to give women more flexibility with their working hours, and pushing company chairs to broaden their criteria for selecting directors.

Wakefield Evans says the discussion about diversity in the boardroom needs to move away from simplistic labels.

Speaking recently at the Australian Council of Superannuation Investors conference, she noted that “Australia has a “systemic, cultural” problem with women in power.”

“We have strong support from business and the investment community, and a burning desire on their part to advocate for diverse boards.  We have bi-partisan support from our political leaders. The community at large expects the composition of boards to reflect the broader Australian population.  So I believe the time is right to reignite this conversation and campaign.”

“Gender still plays into the reporting of how directors and executives perform.  It shouldn’t matter whether they are male or female,” she says.

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Susan Oliver

Two-thirds of ASX 200 boards “always or sometimes” gravitate to candidates who are known to board members when they are selecting new directors, says the 30% Club.

Directors who responded to a survey ‘Shaping the Boards of the Future’ by the 30% Club and the Australian Institute of Company Directors say it is easier to imagine working with someone who is known by at least some on the board and who has an established reputation in the market.

The 30% Club was launched in Australia in 2015, with the primary objective of securing 30 per cent of the seats on ASX 200 company boards for women.

“Given the current small percentage of directors who are female, this leads to a Catch 22 situation, where fewer females are known to directors and this reduces the likelihood that females will be selected,” notes Susan Oliver, member of the 30% Club Steering Committee.

This problem is compounded by the sluggish turnover on some boards and also by the fact that only 6.5 per cent of boards seek outside advice, by using a search firm for succession planning.

The 30% Club says this is having a measurable negative impact on board diversity.

Only 77 per cent of respondents to the survey say they have been either very effective or mostly effective in securing female candidates.
“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 strategic imperative,” notes Ms Oliver.

“When chairs place too high a value on “collegiality and teamwork”, it can be used as a code for “being like us” and limit the opportunity for injecting innovative and diverse thinking.”
Peter Hay, Chair of Newcrest Mining and Vicinity Centres. Says: “Replacing like with like skills is common if the board is right in the first place, but you do need to keep reviewing the skills and the composition to make sure the board meets the requirements of a changing world.”

The 30% Club’s position is that good succession planning based on skills, diversity and planning for the future, rather than replacing like with like, is good for governance.

The survey highlights a number of other entrenched practices that may be hindering boards’ capacity to meet their diversity charters.

One of them is the adherence to a de-facto fixed term for directors, which limits boards’ ability to take opportunities to optimise board composition to meet strategic needs and enhance diversity.

According to the Corporate Governance Principles of the ASX Corporate Governance Council, boards should assess whether a director who has served on a board for more than 10 years has become too close to management to be considered independent.

As a consequence, a nine or 10-year term appears to have become the de facto limit for directors. Over 80 per cent of respondents acknowledged that most directors serve a full nine or 10 years.

Another concern in the context of identifying female director candidates is the tendency for boards to issue highly specific briefs, in terms of experience.

Seventy-four per cent of respondents noted that the charter of their nominations committee references diversity of the board’s members in terms of skills, experience and gender.

However, only 18.1 per cent cited changing business needs as the reason for such discussions and only 10.2 per cent cited the need for enhanced board diversity.

The 30% Club has made a number of recommendations for good practice in board succession planning. They include:

• The board should have regular, honest conversations about current board composition and diversity of skills, expertise, attributes and experience.
• A director other than the board chair should chair the nominations committee, to enhance the prospect of new perspectives influencing selections.
• Candidate briefs should not be so specific that they exclude an otherwise suitable candidate from being considered.
• The chair of the nominations committee should ensure that all board members contribute to a director brief.
• All directors should interview board candidates and meetings arranged with the CEO and leadership team.
• Collegiality should not be used as an excuse to only appoint directors the board knows and is comfortable with.
• An effective induction process should support every new director.

About the survey

Shaping the Boards of the Future is based on interviews with 10 ASX 200 company chairs and non-executive directors, which gave an insight into the evolution of board succession practices. In addition, the AICD’s ASX 200 director members were invited to participate in an online survey, and advice was provided by an experienced board evaluation consultant.

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David Gonski

The 30 % Club has launched the 30% ‘Surge for Diversity’ campaign to increase the momentum for change in Australia’s boardrooms, and is calling on the corporate community for support.

Launching the campaign at a 30% Club meeting in Sydney today, ANZ chair and prominent supporter of the 30% Club, David Gonski AC, said that achieving greater board diversity was an important part of enhancing corporate governance.

“Diversity of thought and independence are essential elements of an effective board, which is why we must continue to push to achieve our goals of at least 30 per cent female ASX 200 board members,” Gonski said.

Over the next two months the Australian chapter 30 % Club, which has the primary objective of achieving 30 per cent female representation across ASX 200 boards by the end of 2018, will campaign for commitments from companies that do not currently meet the target.

As part of this campaign, the 30% Club’s Investors Working Group members will apply pressure through their channels to help drive activity and the Executive Search Working Group will be on hand to assist with the appointment process.

The 30% Club will release a key research report on board succession practices and how to improve diversity on the boards of Australia’s largest companies.

The chair of 30% Club Australia, Patricia Cross, says that after stalling in 2017, the appointment of women to ASX 200 boards has picked up again this year and the 30% Surge for Diversity campaign aims to drive that momentum.

Cross says: “Our focus is on those boards that have yet to reach 30 per cent, most specifically the 62 which have appointed one woman and feel they have thus ticked the gender diversity box.

“In that group there are over 20 boards with a number of male directors who have served longer than the ASX Corporate Governance Council’s recommended tenure. One way of quickly reaching 30 per cent is to replace each of those men with a woman.”

According to the latest Australian Institute of Company Directors (AICD) quarterly Gender Diversity Report, as at 28 February 2018, women account for 26.7 per cent of ASX 200 directorships.

Women accounted for 36 per cent of appointments to ASX 200 boards in 2017 but the proportion spiked up to 47 per cent in the first two months of this year.

It was the highest rate of female appointments to ASX 200 boards since the AICD started tracking gender diversity statistics

Among ASX 200 companies, 74 have reached the 30 per cent target. Only five ASX 200 companies have no female directors.

The 30% Club was launched in 2015, with the primary objective of securing 30 per cent of the seats on ASX 200 boards for women.

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Elizabeth Proust AO

30% Club and AICD release thought provoking video showing the type of questions female board candidates are still being asked in interviews.

The percentage of female appointments to ASX 200 boards has spiked in 2018, according to a new report released on International Women’s Day by the Australian Institute of Company Directors (AICD).

Women accounted for 47% of ASX 200 board appointments in the first two months of 2018, up from a sluggish 36% in 2017.

The AICD’s Quarterly Gender Diversity Report, which tracks progress towards the Institute’s target of achieving 30% female representation across ASX 200 boards by the end of 2018, also reveals that women now account for 26.7% of ASX 200 directorships.

The report shows that the number of ASX 200 companies which have no women around the board table now stands at only five, down from 14 last International Women’s Day.

Across the ASX 200, a total of 74 companies have reached or exceeded the 30% target.

AICD Chairman Elizabeth Proust AO cautiously welcomed today’s results.

“Today’s report reveals that 2018 has seen the highest rate of female appointments to ASX 200 boards since the AICD began tracking gender diversity statistics,” she said.

“While this news is encouraging, it is only reflective of the first two months of 2018. We’ll need sustained momentum of this kind if we are to reach our goal of 30% female representation across the ASX 200 by the end of the year.

“The boards of our largest companies have 10 months to prove to the community that they take the issue of gender diversity seriously.

“Greater diversity on boards is vital to the future of good governance in Australia.

“Diverse boards and leadership teams lead to better outcomes for shareholders and stakeholders alike. They lead to greater innovation and better bottom lines.

“This International Women’s Day, our challenge to directors is to look around your board table and ask yourself – how diverse is this group of people? Are you putting your organisation in the best possible position for the future with the team you have?”

To coincide with International Women’s Day, the 30% Club and AICD has released a video showing the type of questions female board candidates are still being asked in interviews. Watch the video.

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Brenda Trenowden

A growing body of empirical evidence and research, from different sources and geographies, corroborates the intuitive argument that more diverse boards and senior management teams are more effective than ‘identikit’ teams in delivering better decision-making, and that firms with better gender balance at board and management levels outperform their peers on a variety of financial measures^[1] , says Brenda Trenowden, Global Chair, 30% Club and Head of FIG Europe, Australia and New Zealand Banking Group Limited (ANZ) and Deborah Gilshan, Co-Chair, Investor Group, 30% Club and Governance & Stewardship Director, Aberdeen Standard Investments.

Both Ms Trenowden and Ms Gilshan highlight the following points: A better gender balance is good for the economy and should be supported by public policy. However, this should not be through ‘hard’ legislation such as quotas, as we do not believe that their impact filters down into companies and into organisational cultures to deliver long term sustainable change.

The stakeholders who are in a position to really drive change are Chairs and CEOs, regulators and public policymakers and investors – both asset owners and asset managers.

Shareholders have a major role to play in expecting their investee companies to seek out and hire the best people and to draw on all of their individual strengths and experiences to produce the best possible outcomes.

The 30% Club believes that board appointments should always be made on merit and that considerations on diversity can ensure that appointments are made precisely on that basis, by widening the pool of talent available from which board appointments are made.

There are many consequences of a lack of diversity for board effectiveness, including a lack of appropriate representation and understanding of a company’s customers, workforce and geographic footprint, all key to successful delivery of long-term strategy. Importantly, increased diversity on the board is likely to reduce the potential for entrenchment and groupthink, and will further widen the potential talent pool for appointments.

Diversity is not a social issue, it is a financial issue and should be treated like any other business imperative, with targets that are regularly measured and reported. What gets measured gets managed, and what gets managed gets done.

The Investor Groups at 30% Club are growing in AUM globally and we intend to harness the power of stewardship to work together to hold investee companies to account on this important issue.

We believe boards that genuinely embrace cognitive diversity, as manifested through appropriate gender representation and a broad spectrum of skills and experience, are more likely to achieve better outcomes for their investors. Intuitively, it makes sense that diverse groups will be able to draw on a wider set of experience and broader thinking, leading to better decisions and, ultimately, superior financial performance over the longer term.

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[1] McKinsey Women Matter: Ten Years of Insights on Gender Diversity, October 2017
Petersen Institute: Is Gender Diversity Profitable? Evidence from a Global Survey, February 2016
MSCI Women On Boards: Global Trends in Gender Diversity on Corporate Boards, November 2015
Grant Thornton The Value of Diversity, September 2015
Credit Suisse The CS Gender 3000: Women in Senior Management, September 2014
Credit Suisse Gender Diversity and Corporate Performance, August 2012
Citigroup ASX100 Women on Board Analysis, August 2011
Catalyst ‘The Bottom Line: Corporate Performance and Women’s Representation on Boards’, 2007

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Susan Roberts

The 30% Club Australia, which is campaigning for 30% women on ASX 200 boards by the end of 2018, is calling for the investment community to engage on the issue of board diversity and to consider diversity when voting on the Report & Accounts and the appointment and re-election of board members.

“This call comes at a time when more and more global and Australian investment managers and asset owners are signing up to the Statement of Intent for Investors,” says Susan Roberts, Chair of the 30% Club Investors Working Group.

The 30% Club Investor Group’s Statement of Intent represents the increasing number of Australian companies that subscribe to and actively promote the goals and philosophies of the 30% Club. These companies publicly endorse and encourage progress on gender diversity.

Roberts notes “It is heartening to see that the investment community and shareholders are increasingly looking closely at the ESG and ethical aspects of how listed companies are running their boards and how they are configured.

“Large super funds and investment managers are becoming increasingly concerned about board diversity and actively engaging with management to accelerate the change in boards.”

Roberts says “Whilst we are strongly supportive of voluntary targets over quotas, we believe that it is important that investors actively oversee companies’ actions. We encourage investors to engage directly with companies in the first instance. However, we believe that, over time, this should extend to AGM voting in the event of inadequate leadership.”

Companies that have already signed the Statement of Intent include Aberdeen Asset Management, AMP Capital, Australian Ethical Investment, Blackrock Investment Management (Australia), CareSuper, Cbus, Colonial First State Global Asset Management, Commonwealth Superannuation Corporation (CSC), First Super, HESTA, Hostplus, IFM Investors, Principal Global Investors (Australia), State Street Global Advisors (SSGA), and VicSuper.

30% Club Chair, Patricia Cross adds “The recent Australian Institute of Company Directors’ Quarterly Gender Diversity report showed that the monthly rate of female appointments to ASX 200 boards declined from 44% in 2016 to just 30% in 2017. This is a very disappointing result.”

Cross says “I think there is conscious bias in terms of how we put our boards together and that becomes very clear from some of the 30% Club research when chairs and board directors talk about fit and style. There is a real aversion to putting people on boards they perceive will not be part of that fit.

“I also believe that the myth of merit is alive and well and more work needs to be done on how diversity matters rather than why diversity matters. There is a lot of research that points to the correlation between female representation in leadership and board and return on equity or performance of companies. Research is done in various ways but the overwhelming conclusion is that diversity matters in producing better results.

“A very healthy and necessary change has occurred over the last 10 years within the Australian superannuation industry whereby the focus is on the long-term return to their members.

“Some fund managers continue to manage money on behalf of the beneficiaries and are focused on the short-term. But what is now happening is that the beneficial owners are saying enough is enough -we want to look at long-term wealth creation, we want companies that are well governed and we want companies that are going to be sustainably put together in a way that they can deliver wealth for us over the long-term. Diversity is a critical component of that,” notes Cross.

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