It's one thing to appoint a woman to a major company board. It's another matter to actually put them in charge, as chair or CEO. Or both.
The recent announcement of Catherine McGrath as CEO Westpac marks the continuation of banks being at the forefront with Dame Therese Walsh and Vittoria Shortt the chair and CEO combo at ASB, Jan Dawson and then Pip Greenwood as the chair at Westpac/Catherine McGrath as CEO, while Antonia Watson is CEO of ANZ and Angela Mentis CEO of BNZ. And we need to acknowledge the women in banking who led the way before this, like Barbara Chapman, ex-CEO of ASB and now chair of this very publication, NZME and Genesis Energy.
Spark remains the only major publicly listed board with women at the helm, when chair Justine Smythe led the board to appoint Jolie Hodson CEO in 2019. Spark has had an even gender split on its board for several years.
In 2020, the world's most influential companies made a major shift towards diverse boards of directors. S&P 500 boards filled 59 per cent of their new independent director roles with women and minority men, and now there's at least one female board member in every S&P 500 firm.
And they're doing it because diversity in governance improves business performance.
Harvard Business School's 2018 study on male-dominated venture capital industry showed that hiring 10 per cent higher proportion of female partners led to a 1.5 per cent spike in overall fund returns and 9.7 per cent more profitable exits. In short, the more diverse their partners, the higher their investment performance.
At home, New Zealand reached 29 per cent female directorship across S&P/NZX 50 companies, well under the 40 per cent target as set by Global Women and Champions of Change. But one out of five NZX listed companies has no women on their boards at all. In the United States, less than 3 per cent of listed companies have no female directors and in Australia, it is less than 5 per cent.
And well behind the public sector. In September 2020 the government announced it had increased women on boards to a record 50 per cent, up from 45.7 per cent in 2017.
It's a disappointing figure for the world's first self-governing country to have granted women the right to vote in parliamentary elections almost 130 years ago.
New Zealand sits near the bottom of the rankings of similarly developed countries for percentage of female corporate directors. We have been outperformed in our efforts to increase the numbers of women in private boardrooms by many countries including Australia, Germany, Norway and France.
In addition to women being under-represented on the boards of directors of private companies there is a lack of visibility of Māori, our indigenous peoples, people with disabilities, ethnic and new migrant representatives, and members of our LGBTIQ+ community.
A homogenous board inhibits business growth because as decision-makers, boards should be able to understand and represent their market. In New Zealand, 80 per cent of daily consumer decisions are made by women.
There is international evidence that gender balance in governance and leadership roles correlates with better decision making, organisational resilience and performance. Inclusive and diverse boards are more likely to be an effective board, better able to understand their customers and stakeholders and benefit from fresh perspectives.
For decades we've been talking about putting more women in charge, but our top companies are still largely governed by Pākehā men. Why? Because our society accepts that it's OK to be like that. If we didn't, we would have collectively put in place a whole range of measures to shift it.
As Vicki Saunders, the global founder of SheEO, points out our 'winner takes all culture' has resulted in five men having the same wealth as half the planet. And now, the rest of the world is changing and if we don't restructure our business communities, we're bound to lag behind.
Thankfully, there are clear glimmers of hope and swathes of people ready to drive the movement forward.
To 'normalise' having women in leadership, we need more women around board tables, more women chairs and CEOs, and more women running the major profit divisions of companies.
We know it is the right way to go because the best companies are already doing it.
11 of the NZX Top 50 are chaired by women
· Air New Zealand (Dame Therese Walsh)
· EBOS (Elizabeth Coutts)
· Genesis Energy (Barbara Chapman)
· Mercury NZ (Prue Flacks)
· Oceania Healthcare (Elizabeth Coutts)
· Serko (Claudia Batten)
· Skellerup (Elizabeth Coutts)
· Spark New Zealand (Justine Smyth)
· Vista (Susan Peterson)
· Westpac (Pip Greenwood)
· Z Energy (Abby Foote)
- Theresa Gattung was initially known for her role as the first woman to be CEO of Telecom New Zealand as well as an NZX listed company. She has held multiple governance positions and continues to be a member of the National Advisory Board on the Employment of Women, the chair of Global Women, as well as the New Zealand lead of SheEO, an international community that supports, finances, and celebrates female entrepreneurs.