The beginning of April marked a deadline for all companies listed on India’s national stock exchange to appoint at least one female director. An estimated fifth failed to do so, despite a six-month extension. Last minute scrambling resulted in some businessmen appointing their wives in order to fulfil the requirement.
It’s a disappointing reminder for us all that while we are making gradual progress here in Asia, there is still much more to be done. Companies need to recognise the importance of gender diversity for the business; and nations need to see it as an economic imperative.
In India one estimate indicates its per capita income could be 10-13 per cent higher in 2020 and 2030 respectively if it significantly reduces the gender gap. So what does that mean for countries that are failing to address gender diversity? What happens to the board-ready talent available? The answer is those individuals either stagnate in their existing roles with no opportunity for progression, or move abroad to secure the right roles.
Asian female talent brain drain
Many industry leaders in Asia I have spoken with are worried women in the region are being left behind in the global gender diversity movement – but I’m more concerned that it’s the women who are leaving Asia behind.
A recent OECD study showed that many smart, talented, ambitious women, who are held back by discrimination and cannot find the opportunities they want at home, are simply turning to other countries to advance their careers.
The study found female migration rates from non-OECD countries to OECD countries, where opportunities for women tend to be greater, was higher than male migration rates in 88 per cent of the countries. The gap is particularly pronounced for highly skilled individuals, with migration rates of females with post-secondary education 17 per cent higher than those of males.
The growing gap
If we look at other regions it’s clear that gender diversity in the boardroom, and across the workforce, is picking up steam. In March, Germany became the latest European nation to set a quota for women on corporate boards, with a new law requiring large companies to appoint females to 30 per cent of their board seats; similar legislation for all listed companies across the EU is also on the docket.
Two years on, “Lean In” is starting to gain real traction as a business buzzword, now joined by campaigns such as “HeForShe”. Major companies such as Apple and Google have begun to voluntarily disclose employee diversity data.
On Norway’s boards, 35 per cent of the seats are filled by women, in France it’s 30 per cent, and in the UK it’s 23 per cent; meanwhile, Hong Kong and India are at a paltry 10 per cent and Japan a disappointing 3 per cent.
If the gap in these numbers continues to grow so too will the numbers of talented female professionals emigrating from the laggards to the leaders.
Stemming the flow
Some may argue that those women leaving the Asian market will eventually return and bring with them valuable skills and working practices. Whilst this is true, Asia still has a pressing immediate need to retain some of this top talent, which is already in short supply in many key sectors.
So how can businesses in rapidly growing markets, such as Asia, prevent this scenario from playing out?
Firstly they need to step up their efforts, not just in hiring women, but also in identifying, developing, nurturing, empowering and championing female talent. As the example of India shows, even when a mandate to bring greater gender balance to corporate leadership exists, the appropriate talent might not be easily identified.
Companies often highlight the lack of a skilled talent pool of women, but research consistently demonstrates this is not the case. Female leaders are simply more hidden and less inclined to put themselves forward, as they do not feel empowered or ready to take on a board role.
Our work at Harvey Nash with The University of Hong Kong Business School on the Women’s Directorship Programme, has made this evident. We created the international board preparedness programme with the aim of enabling participants to become effective board members and serving to increase the supply of board-ready female executives across geographies and business sectors. Since the programme’s establishment in 2013, more than 30 per cent of our participants have secured their first board appointment.
The key lessons from the programme include:
Too few companies in Asia are willing to give women the break they need, preferring to opt for the tried and tested route, selecting board members through their existing, male-dominated, networks. In Hong Kong, nine out of ten new board appointments in the past year went to men.
In today’s globalized world, businesses need to take steps to unlock the potential of female talent before their competitors, both local and abroad, do. Maintaining the status quo on gender diversity, whether at the business level or on a larger national or regional scale, will only mean suffering the consequences of female talent brain drain.
Article contributed by…
‘Kirti Lad, Hong Kong Director for leading global recruiter Harvey Nash and co-leader of the Women’s Director Programme‘
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