The Diversity Action Committee (DAC) advocates increasing women directors on listed company boards in Singapore for the sustainable competitiveness of companies and the economy as a whole.
Mr Loh Boon Chye, CEO of the Singapore Exchange (SGX), was appointed to be the Chairman in October 2016 by Mr Tan Chuan-Jin, Minister for Social and Family Development. Madam Halimah Yacob, Speaker of Parliament of Singapore, has been the Adviser since the formation of the Committee. There are 18 members in the Committee, comprising leaders and professionals from the business, people and public sectors.
The DAC announced a triple-tier target of 20% by 2020, 25% by 2025 and 30% by 2030 for SGX-listed companies, as a result of an in-depth examination of the possible steps that companies can take to increase diversity in the context of a good governance structure and process. Larger companies are called to take the lead and create a momentum of change. In working to accelerate the number of women board directors in Singapore, the DAC will pursue a 6-step plan.
The triple-tier target and 6-step plan are established based on the foundation laid by the DAC in its first term, under the chairmanship of Mr Magnus Bocker from August 2014 to October 2016. Members of the DAC recommended to the Monetary Authority of Singapore (MAS) in August 2016 to strengthen the Code of Corporate Governance (Code), as a matter of immediate priority, by requiring listed companies to establish and disclose their:
- Diversity policy (including gender) for board and key management
- Measurable objectives that express their policy and
- Progress made in achieving these objectives.
The Monetary Authority of Singapore responded by forming a Corporate Governance Council in February 2017 to review the Code.
The DAC also published Women on Boards: Tackling the Issue in October 2016 that highlights its findings on the obstacles to increasing women’s representation on boards and provides potential solutions to the problem in Singapore. The 5 recommendations the DAC made in this report to increase the pace of change are:
Click here to view Women on Boards: Tackling the Issue and its Supplement Speaking with the Boards, which included insights from chairmen and women directors of leading companies on the topic of gender diversity on boards.
Prior Efforts Leading to the Formation of Diversity Action Committee
Prior to the establishment of the DAC, Madam Halimah Yacob initiated the formation of the Diversity Task Force regarding Women on Boards (DTF) in late 2012 during her term as Minister of State, Ministry of Social and Family Development. The DTF was set up to examine the state of gender diversity on boards and in senior management of companies listed on the Singapore Exchange, as well as its impact on corporate performance and governance. DTF was chaired by Mrs Mildred Tan, Managing Director of Ernst & Young Advisory Pte Ltd.
The DTF launched its report, Gender Diversity on Boards: A Business Imperative, in April 2014 with Mak Yuen Teen, Associate Professor of Accounting at NUS Business School, as consultant and lead researcher. The DTF did not recommend the implementation of quotas or setting targets at that point in time as the causes of poor gender diversity were complex. Instead the DTF recommended 10 measures to address the underlying causes and allow these measures to run their course before assessing if quotas should be imposed in future. One of the recommendations was the establishment of the Diversity Action Committee (DAC) to bring about real changes to women’s representation on boards. Mr Chan Chun Sing, then Minister for Social and Family Development, formed the DAC in August 2014 to take forward the DTF’s recommendations.