Wednesday 22 November 2017

Old boys' club slow to get women on boards

Just one in 16 of Ireland's company directors is a woman. Are men really that much better -- or is there a glass ceiling, writes Nick Webb

Ireland's top-listed companies have fewer women board members than equivalent companies in Malaysia. Sunday Independent analysis of our biggest company boardrooms shows that just over 6 per cent of directors are women. In Malaysia, the figure is closer to 8 per cent. The Irish "old boys' club" is alive and well.

The idea of introducing quotas for women directors is gaining traction, especially as it has already been introduced in Norway. But Ireland's big investors, the pension funds that own big chunks of the country's listed firms, are strongly opposed to forcing boards to take more women.

"We wouldn't support quotas," said Frank O'Dwyer of the Irish association of Investment Managers, pointing out that being a suitable candidate is more important than gender.

"But we need more diversity on boards," he added. O'Dwyer dismisses the argument that the pool in Ireland is too small as most listed companies have international footprints. "The flaw in Ireland has been the unnecessary focus that directors should be Irish," he said. They should look abroad for new skills.

About 12.5 per cent of London's FTSE 100 company directors are women -- double the rate of Ireland. Although the level has been flat for the last three years, it's an increase on the 9.4 per cent in 2004.

"Do we see it changing? Yes," said Mr O'Dwyer. "It's a live agenda item in the context of board quality and renewal."

Outside of the investment community, the Government is the only other group with the clout to break up the "old boys' club" that makes up corporate Ireland. A Green Paper on corporate governance and jacking up boardroom diversity is crawling towards Europe and the Department of Enterprise has also looked at the issue as part of a wider review of corporate governance. So unless Europe makes us do something, we'll flub it. Expect the creation of a few task forces or commissions to examine the issue and report back by 2020.

The stats for Ireland are pretty medieval. Almost all of our 35 largest stock-exchange listed firms have no women board members at all. These aren't tiny little resources companies either. With a market capitalisation of over €5bn, Michael O'Leary's Ryanair is the second-largest company on the market. There are no women among its 10 directors.

Stan McCarthy's €4.8bn-valued Kerry Group has 15 directors in its board room but no women. Owen Killian's Aryzta has 10 board members but no women either. Origin Enterprises, the Aryzta spin-off, is also a no-women zone in the boardroom.

Some companies, like IL&P, Aer Lingus and INM, are well ahead of the curve, with the highest female representation on their boards.

CPL's Anne Heraty is the only chief executive of a stock-market company. Gillian Bowler is chairman of Irish Life & Permanent but is in the departure lounge ahead of the appointment of her successor. Executive directors are few and far between. Maeve Carton is finance chief at CRH, with Josephine Tierney and Siobhan Talbot in similar roles at CPL and Glanbia. United drug's Annette Flynn and Greencore's Dianne Walker also hold executive roles.

Some 15.7 per cent of directors of Fortune 500 firms are women, according to new number-crunching from non-profit research firm Catalyst. Even the reindeer-scoffing Norwegians are more progressive. Around 40 per cent of board members of stock market-listed firms are women.

This was brought about by a mixture of government and investor pressure. In 2006 Norway introduced quotas to increase female representation in boardrooms. The "old boys' club" rose up in arms with almost 100 companies delisting from the stock market in protest. But the rules were still applied. Spain, France and Germany are now looking at introducing quotas for public companies.

The Norwegian stock market didn't implode. The OBX Index is up over 30 per cent since autumn 2006. "Neither the worst fears of opponents nor the greatest hopes of proponents have come true," according to Marit Hoel, director of the Oslo-based Center for Corporate Diversity, in an interview with Der Spiegel.

Her research showed the restructuring of corporate boards had not created corporate mayhem or tumbling share prices. She found the balance sheets of successful firms wobbled in the short term but recovered quickly. "By contrast, companies that weren't doing so well tended to benefit from having women on their boards."

Sunday Indo Business

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