Lack of Progress in Asia Pacific Board Diversity a Cause for Worry


Region will take a decade to catch up with developed economies

Singapore, April 19, 2016 - A comprehensive Asia Pacific study by Korn Ferry (NYSE:KFY), the preeminent global people and organisational advisory firm and the National University of Singapore (NUS) Business School’s Centre for Governance, Institutions and Organisations (CGIO), revealed that companies with greater female representation in the boardroom tend to be more profitable, but women still remain under-represented across Asia Pacific boards, with most countries showing little or no progress.

According to the findings, three countries in the Asia Pacific region, namely Australia, India and Malaysia, showed significant improvement in broadening women representation on boards across the companies. A combination of government initiatives has contributed to the increase in these countries.

Alicia Yi, Managing Director, Board & CEO Services, Korn Ferry explained, “It is clear that governments and regulators play an instrumental role in shaping the board diversity landscape. Whether it is through targets, quota or disclosure requirements, these measures are needed to help enterprises make a deliberate choice in considering female candidates alongside men for senior positions. The benefits to sustainability, talent retention, strategic growth and sustainable success are significant.”

The study, Building Diversity in Asia Pacific Boardrooms, is the fourth in the Korn Ferry Diversity Scorecard series and examined the largest 100 publicly listed companies’ 2014 annual reports in ten Asia Pacific economies: Australia, China, Hong Kong, India, Indonesia, Japan, Malaysia, New Zealand, Singapore and South Korea. Based on the findings, firms with at least 10 per cent of female board members delivered a 14.9 per cent return on equity (ROE) in 2014 compared to just 12.6 per cent for those without.

Despite a compelling business case for board diversity, the increase in gender board diversity continues at a slow pace. Women make up 10.2 per cent of all directors in this latest study, up from 9.4 per cent in 2013 and 8.0 per cent in 2012. Only three out of ten countries showed substantial improvement.

Asia Pacific still lags substantially behind major economies

Asia Pacific falls far behind benchmark global economies such as the United States, the United Kingdom and the European Union. For the region to reach parity with these markets, it would require another decade of growth at the current pace.

It is encouraging to note that all-male boards are no longer a majority in the region with a significant drop from 53.2 per cent in 2012 to 39.0 per cent in 2014. This large decrease indicates that boards recognise the need for gender diversity. However, they still lag far behind Financial Times Stock Exchange (FTSE) 100 companies; there are no longer any all-male FTSE 100 boards.

Improvements in just three countries

Most of the countries reviewed showed little or no improvement in gender diversity, with the exception of Australia, Malaysia and India. These three countries also saw regulatory action or governmental support for promoting board diversity.

  • Australia continues to be the best performing country in the region. With 21.9 per cent female board members among the Australian Securities Exchange (ASX)-listed companies, it is the only economy in this survey with over 20 per cent of women on boards. This figure is nearly double what it used to be in 2011, reflecting the ASX’s inclusion of gender diversity policies in its corporate governance council reporting rules.
  • Malaysia saw the largest year-on-year increase in female representation, from 8.3 per cent to 12.5 per cent, reflecting the success of its governmental programmes to increase gender diversity. Although it fell short of its target of 30 per cent female representation by 2016, Malaysia is the only country in the study to have implemented such a target and provided active support for companies to reach the goal.
  • India has made significant progress in broadening female representation across companies. Companies there reported an increase in female board representation from 7.3 per cent to 8.6 per cent in 2014. The Company Act, which required all listed companies to have at least one woman on the board, has helped enable this broadening female representation.

At the bottom of the gender diversity rankings are South Korea and Japan with 2.6 per cent and 3.3 per cent female board members respectively, followed by Singapore at 7.7 per cent.

Alicia Yi explained, “There is no doubt that a gender-balanced and diverse board can add real value to operational and financial performance. In Asia Pacific, we have a long way to go when it comes to fully embracing diversity. Thus, a stronger push is needed to bring corporate boards to the next level in the region.”

“Our aim is to raise awareness and encourage all stakeholders – governments, regulators and private enterprises – to take an active approach to improving board diversity in Asia,” concluded Alicia Yi.

Click here to download the report.

About Korn Ferry

Korn Ferry is the preeminent global people and organisational advisory firm. We help leaders, organisations and societies succeed by releasing the full power and potential of people. Our nearly 7,000 colleagues deliver services through our Executive Search, Korn Ferry and Korn Ferry divisions.

About the Centre for Governance, Institutions and Organisations

The Centre for Governance, Institutions and Organisations (CGIO) was established by the National University of Singapore (NUS) Business School in 2010. It aims to spearhead relevant and high-impact research on governance issues that are pertinent to Asia, including corporate governance, governance of family firms, state-linked companies, business groups, and institutions. CGIO also organises events such as public lectures, industry roundtables, and academic conferences on topics related to governance.

NUS Business School is known for providing management thought leadership from an Asian perspective, enabling its students and corporate partners to leverage global knowledge and Asian insights.

The School is one of the 17 faculties and schools at NUS. A leading global university centred in Asia, NUS is Singapore’s flagship university, which offers a global approach to education and research, with a focus on Asian perspectives and expertise. Its transformative education includes a broad-based curriculum underscored by multi-disciplinary courses and cross-faculty enrichment. Over 37,000 students from 100 countries enrich the community with their diverse social and cultural perspectives.

For more information, please visit, or go to the Think Business portal, which showcases the School’s research

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