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Working together to achieve board gender diversity

Speech by Ms Grace Fu, Minister for Culture, Community and Youth at the Launch of the Singapore Board Diversity Report  

26 January 2018

Ms Junie Foo, Chairperson and Co-founder of Boardagender,

Ms Trina Liang, Co-chair of Boardagender and SCWO Board Member,

Ms June Goh, President of SCWO,

Ladies and Gentlemen,

1. Good evening! I am happy to join you tonight for the launch of BoardAgender and the Human Capital Leadership Institute’s new report on Singapore’s Board Diversity.

Growing voice of women

2. Last year, online dictionary Merriam-Webster picked “feminism” for its word of the year. Online searches for the word peaked along with key events including the Women’s March, a worldwide protest in January 2017 involving about 5 million people across the world advocating for women’s rights.

3. The #MeToo and #TimesUp movements started with women in the show business coming forward and calling out men in power for their alleged sexual misconduct and assault. In the technology sector, reports of women being denied promotions and equal pay were making also headlines in the news and social media. Their collective impact was so great that a group of women was named Person for the Year by Times Magazine. They are called the Silence Breakers. The Times has this to say about them – “These silence breakers have started a revolution of refusal, gathering strength by the day, and in the past two months alone, their collective anger has spurred immediate and shocking results: nearly every day, CEOs have been fired, moguls toppled, icons disgraced. In some cases, criminal charges have been brought.”

4. Women are asking questions about what their companies, institutions and organisations are doing about this issue – what is the protocol to handle the complaint; what actions are to be taken against the perpetrators; what protection do you have for me and how do you prevent this from recurring. In other words, what are you doing in your organisation to ensure that women can do work, safe from superiors who abuse their power?   

5. This is but one reason why women voices on the Board and in leadership are critically needed for businesses these days. While not all companies face workplace issues such as sexual harassment, nor will women Board members prevent it from happening, all serious-minded Boards should enable such issues to be considered in a conducive Boardroom culture that will stand up to scrutiny when faced with such an allegation. Board diversity, particularly gender-diversity in this case, is a necessity, not a nice-to-have.

6. Beyond the workplace, the power is also shifting in the marketplace. With increasing buying power and influence, women are behind many purchasing decisions today – including food, home furnishings, vacations, even homes and automobiles. Marketing research data estimates that women account for 85% of all consumer purchases.

Need to shift mindsets

7. In Singapore, the female labour force participation rate grew from 57% in 2011 to 60.4% in 2016. Today, women make up more than 45% of our labour force. But, women only occupy just over 10% of board seats. This is far from optimal.

8. What could be the reasons that are stopping companies from appointing female board members? The report highlighted several impediments, including long tenures of existing directors making little room for renewal; an archaic checklist of what makes a “suitable director”; and a lack of resolve to look for talents beyond the usual pool.

9. Many of the businesses surveyed in the study were “meritocracy upholders”, believing that women should not be given priority just because of their gender. I agree, but I also would like to encourage companies to review the yardsticks for board members and for deciding what is meritorious. Does it include the ability to understand issues faced by your female workforce and consumers and to bring those perspectives to the Board? Does it include the capability to attract female talents who are ambitious and committed to fulfilling their career potential while having a family?

10. Having female board members makes sound business sense, as they can bring diversity in views and ideas to the table. They can help manage gender-based opportunities and challenges. They can also add value to your policies and practices, providing perspectives from women, for women in the workplace.

11. As the business landscape rapidly evolves, corporates and boardrooms must adapt and be equipped with more diverse strengths, skills and talent. Only then can you be truly progressive, successful and sustainable in the long run.

Working together

12. Last year, the Monetary Authority of Singapore formed a Corporate Governance Council to review the Code of Corporate Governance. The Council has just launched a public consultation on its key recommendations last week.

13. In its package of recommendations, the Council recognises the importance of board renewal and board diversity in enhancing board quality. One of the Council’s recommendations is to strengthen the nine-year rule for independent directors. Another recommended enhancement is for companies to disclose their board diversity policy and progress made towards achieving the policy. These are positive steps in encouraging board renewal and diversity.

14. It will take time and collective effort by all corporate leaders, both women and men, to shift mindsets and effect change. Many of you are already leading by example but we need more to come on board. We must be more proactive in articulating the benefits of board gender diversity, and support other companies that are beginning their journey to form a more diverse board.

15. As we advocate for gender diversity, we must also empower women to step up. There is no lack of capable and qualified women to take up board seats in Singapore. Currently, women fill about one in four senior management roles in companies, and one in three non-profit board seats.

16. As corporate leaders, we are responsible for developing female leaders to become potential board candidates. This can be achieved through mentorship programmes, and profiling and raising visibility of female executives who aspire to board directorship.

Conclusion

17. In 2016, the Diversity Action Committee set the target of 20% female board directorship among SGX listed companies by 2020. This target may appear to be a stretch. Over the past six years, female board membership increased by about 110 seats in total. To achieve our 20% target, we need an additional 130 female directors per year from now till 2020!

18. This is an achievable target if we are committed to make the change. What it takes is half of the companies on SGX, especially those without female directors, to each make an effort to appoint just one female director to their board.

19. To move the needle on board gender diversity, both women and men need to make a concerted effort. Let us work towards a more gender-equal society, where everyone plays an equally important role in the workplace and at home.

20. Thank you for putting together this report, and for this opportunity to discuss with all of you how we can advance our common goal.

Last Updated: 29 January 2018

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