Women in Business 2021 report by global accounting firm Grant Thornton says that India ranks third in the world for women working in senior management positions. Against the global average of 31 per cent, the percentage of women in senior management for India stood at 39 per cent, which signals the changing outlook of Indian businesses towards working women. “Innovative", “adaptive to change" and “courageous to take risks" will emerge as top leadership traits in 2021, the report said. “Under the challenging circumstances of 2020, the boundaries between work and home have blurred. In this scenario, it is good to see action being taken by businesses to ensure employee inclusion," said Pallavi Joshi Bakhru, partner, Grant Thornton Bharat.
According to consulting and auditing company Deloitte India, Board seats held by women in Indian companies had gone up to 17.1 per cent in 2021 from 13.8 per cent in 2018, and at least 3.9 per cent of chief financial officers and 4.7 per cent of chief executives were women. Against 4.5 per cent in 2018, only 3.6 per cent of board chairpersons were women in 2021. The comparative figures were 2.7 per cent in 2014 and 3.2 per cent in 2016.
The year when the Companies Act, 2013 clearly articulated the need for more women members on corporate boards, The finding, released on February 8, there was an increase of 9.4 per cent and women held 17.1 per cent of board seats in India. An increase of 2.8 per cent since 2018, globally, 19.7 per cent of board seats were held by women. Up from 2.5 per cent in 2018, 3.9 per cent of CFOs in India were women in 2021. 340 companies in India were analysed by the consulting company. In 2016, the percentage of women CEOs was 3.4 per cent.
“While the Indian regulators have set up a holistic framework to encourage the representation of women in key positions at corporates, the numbers suggest a significant gap between the ideated measures and ground realities. With the continuing disruption and the current pace of change, the case for diverse boards that work with a unified purpose is becoming stronger than it ever was. It is time that gender diversity and gender parity get more focused attention from Indian corporations,” said Atul Dhawan, chairperson of Deloitte India. Among other findings, the consulting company said the average age of women board members in India is 57.4 years while the average age of men board members in India stands at 61.1 years.
Why fewer women on boards?
Deloitte India said fewer women are serving on more boards. In 2021, the stretch factor for women increased slightly from the 2018 figure of 1.22 to 1.30 in India, the same as the global average. Men, by comparison, have a stretch factor of 1.2, the company said. How many board seats an individual holds in a particular market is examined by the global stretch factor metric of Deloitte. From 1.26 in 2018 to 1.30 in 2021, globally the stretch factor for women on the board increased slightly.
Reduced tenure of women board members
As compared to men in India, women are occupying board seats for fewer years. The average tenure of a woman board member has gone up to 5.1 years in 2021 against 5 years in 2018, Deloitte India said. Average 8.1 years is served my men on the board in contrast. The consulting firm observed a decline in the average tenure among women directors in comparison to that of men and globally, this slipped in 2021. From 5.5 years in Deloitte’s previous edition to 5.1 today, the average global board tenure for women slipped. In 2021 globally this was 7.7 years for men. This was particularly apparent in the UK, where it slipped from 4.1 years to 3.6 years, the US, where the tenure of women declined from 6.3 to 5.3 years and Canada (from 5.7 to 5.2 years).
“In large part, this can be explained by the greater number of women on boards in the first place. This is particularly true in the United States, which saw an increase of more than 6 per cent in the number of women on boards but also a decrease in tenure of one year, affecting the global average,” the Deloitte report said.
“The most probable explanation is that more women have joined boards in recent years, and they have had less time to accumulate experience. Or it could be that women who are retiring or rotating out of board service are being replaced by other women, further decreasing average tenure. On the other hand, we also see declining tenure in a few countries where the number of women joining boards has undergone little change since the last edition,” the report said.
Therefore, with the increasing awareness of women for education it is likely that the women in the top leadership positions will continue to rise in the coming years as well.
