The following article titled CEO's exit underscores how few South African women hold top jobs by Dr Nadia Mans-Kemp, Senior Lecturer in the Department of Business Management at Stellenbosch University, was published in The Conversation on 30 January 2019:
The CEO of one of South Africa’s top four banks – Absa – announced
this week that she is retiring after 10 years
in this role.
Employment equity at the bank improved under Maria Ramos’s
guidance. Both the number of black women and men in senior management positions
increased during her period as CEO.
Given that she was the only female CEO of the Top 40 companies
listed on the Johannesburg
Stock Exchange (JSE), gender diversity has taken a
knock as a result of her retirement.
There are now no female CEOs running
any of the country’s 40 largest listed companies. In addition, women make up
only a fifth of the directors who serve on
the boards of companies listed on the JSE.
Several locally listed companies still have no female board
members while most who do diversify their boards tend to appoint only one
female director at a time. Research shows
that a critical mass of at least three women is required to really make a
difference at board level.
A report last year on leadership in the private sector by the
head-hunting firm Jack Hammer concluded that although
positive changes are noted at board level, overall gender transformation is
occurring at a slow pace. It went on to say: “Anecdotally, it is clear that
companies want to appoint more women in senior positions. Placement data also
shows that shifts are being made at executive level. However, only a limited
number of females are appointed in top positions.”
The country’s King IV Report on corporate
governance released in 2016 recommended that companies should set
board gender diversity targets and annually report on their progress. As a
result, new JSE listing requirements were put in place for listed companies to
adopt their gender policies.
In the UK, female board gender targets have been prescribed for
several years. The latest target entails 33% female
board representation for large UK-based companies by 2020. In
Norway, a mandatory 40% board gender quota applies.
There are several reasons for limited female board representation.
Sourcing from exclusive networks (so-called old boys’ clubs) might contribute
to the problem. The situation could improve if a growing number of companies
set realistic board gender targets and strove to diversify their boards.
The current situation
The 30% Club Southern Africa chapter – a lobby group that
advocates for 30% female board gender representation – together with industry
partners published a
report in November 2018 on the state of gender in
companies listed on the JSE.
Of the 267 companies considered, only 10% had gender parity (50%
female board representation). Despite the amended JSE listing requirements, 50
companies did not specifically report on board gender diversity in their
integrated reports.
Based on the gender policies published in the 2017 integrated
reports, it was evident that there were no opportunities for women to be
appointed as directors at 105 JSE companies. Some companies provided generic
disclosures about diversity by stating that they acknowledged the requirement
and were looking at how to increase board gender diversity.
South African companies should caution against the so-called “golden skirts” syndrome. This is a situation
in which only a few well connected women are selected to serve on multiple
boards. They should rather cast the net wider to appoint more eligible women.
Directors who sit on multiple boards run the risk of becoming too
thinly stretched. Despite their considerable expertise, they might struggle to give
sufficient attention to their respective board responsibilities. Executive
search companies have a responsibility to expand their search for the available
female talent in South Africa.
The issue of the diversity of boards is increasingly featuring on
the agendas at annual general meetings. A growing number of shareholders are
questioning the composition of boards
globally and locally.
Individuals from different backgrounds, ages, experience levels,
genders and races should be included on boards so that companies can benefit
from the diversity of their skills and insights. Board diversity, then, entails
a lot more than just the appointment of a female director to meet the targets
that have been set.
Shifting mindsets
Board members need to shift their mindsets if the local talent
pipeline is to be grown.
Sufficient time and money should be invested to equip a diverse
selection of people to apply for directorships. Realistic targets should be set
to diversify boards. The necessary support, including flexibility for parents,
is essential, as family-related responsibilities might prevent women and men from
climbing the corporate ladder.