Case For Diverse Boards

It’s Good for Business

01 It’s good stewardship

“Singapore is well poised to grow with the region and, in fact, to advance efforts to help businesses, markets and countries become even more sustainable, innovative and diverse. To do so, chairmen and business leaders need to shine a light to the most difficult, darkest issues, and boardrooms must adapt and be equipped with more diverse skillsets and new mindsets, to build on strong foundations of corporate governance.”

– Peter T. Grauer, Chairman, Bloomberg

The increasing complexity of today’s environment is placing more pressure on businesses to adapt and remain relevant. Boards, in turn, need to remain fit by finding the best talent for their boards and having a diverse mix of skill sets and experience in their composition to enhance long-term sustainable performance.

Finding the best suited talent means that boards first need to cast their net widely enough to include more of those who would typically be excluded from consideration (eg. women), then appoint the best candidate based on merit.

Key considerations for organisations:

Have you considered widening the talent pool to ensure that an adequate number of women are included in your search for suitable and qualified board candidates?

02 It’s a good investment proposition

“We look for diversity of thought as much as anything else…If a company has zero diversity, it is pretty questionable and it becomes a discussion topic in our engagement”

– Barbara G. Novick, Vice Chairman, BlackRock, on what investors look for in a company.

Globally, investors are looking beyond just the financials and into other indicators that shed more light on the organisation’s interaction with the environment, society and governance.

Increasingly, investors are utilising diversity of gender, skills and experience on a board as an indicator of the robustness of an organisation’s governance systems and its future performance. As women on boards is the most visible form of board diversity, having increased gender diversity on boards enhances an organisation’s investment proposition in the eyes of investors.

Key considerations for organisations:

Have you clearly articulated your board diversity policy, objectives and progress towards those objectives in your annual report? Have these disclosures been considered from a gender diversity perspective?

03 It’s good for governance

“While gender is only one dimension of diversity, it is an important one, as it contributes to different approaches, richer discussion and ultimately better decision making and outcomes … Gender diversity should be seen as a business imperative for the right reasons and the value it brings,”

– Simon Israel, Chairman, Singtel and SingPost

Board diversity introduces fresh perspectives into the boardroom and adds value to the policies and practices of an organisation. A diverse board, made of up people from different backgrounds, and experiences, ultimately minimises groupthink and makes better collective decisions. However, gender is a form of diversity that is clearly lacking from many boards in Singapore today.

Key considerations for organisations:

In filling a board position, do you consider all aspects of diversity such as skills, experience and gender to achieve board balance suited for your organisation’s future goals?

04 It delivers better outcomes

“Many studies have shown that diversity of thought results in better outcomes and women on Boards bring different perspectives to sometimes difficult issues where our economic and social pace of change is accelerating. Creating a more diverse boardroom with women has become essential as a business imperative and adds value to policies and practices.”

– Mildred Tan, Co-Chair, Council for Board Diversity; Chairperson, National Volunteer and Philanthropy Centre

Board diversity is a foundation of effective and high performing boards. The holistic combination of strong governance practices, board diversity and quality of individual directors contributes to more effective collective decision making.

While gender is only one dimension of diversity, it is an important one as it contributes to different approaches, richer discussion, and ultimately better decision making and outcomes. Having gender diverse boards is increasingly seen as a hallmark of progressive companies and boards.

Key considerations for organisations:

Do you agree that having women, especially women independent directors will help in delivering better outcomes?

Have you reviewed your criteria for potential board candidates to ensure that it is not too narrowly defined?

Have you considered looking beyond personal networks to ensure that you have a wide pool of talent to select candidates from?

Useful Links

What Corporate Leaders Say
Get insights and views on board diversity from industry leaders

Finding Women Board Candidates
Learn more about the avenues available to source for suitable women board candidates

Frequently Asked Questions
Your most commonly asked questions addressed