Women representation in India Inc boardrooms has improved in recent times but the Covid-19 pandemic has slowed down the pace of growth and much more ground has to be covered to ensure gender parity at workplaces, a new report shows.

Women now hold 18% of board seats in India, up from 13% in 2017 and 6% in 2013, said an EY report, ‘Diversity in the boardroom: Progress and the way forward’, shared exclusively with ET. Almost 95% of Nifty 500 companies have at least one female board member compared to 69% in 2017, it said.

Part of the credit for this improvement goes to multiple initiatives taken by the Indian government and regulatory bodies. Yet, there’s much to be done still.

For instance, the share of women in non-executive positions on Indian boards is much higher than that of women in executive positions and their growth much faster – improving to 21.4% in 2022 from 16% in 2017 against the progress of those in executive positions to 7.2% from 6% during the same period. This indicates that there is a need to strengthen gender diversity in corporates’ senior echelons, experts said.

“Both aspects – increasing the representation of executive and non-executive women directors – need to be constantly worked on,” said Arun Duggal, chairman of rating agency ICRA. “We need to move to a minimum of two women directors on the board.”

He said companies need to work towards getting more women in senior management and top leadership, which will be a fertile ground for women at the board level. “More effort needs to be put into greater diversity in the corporate sector,” Duggal said.

There is also divergence in gender diversity on boards across different industries, the EY report said. Life sciences – where share of women directors rose to 24% in 2022 from 16% in 2017 – media and entertainment (23% in 2022 against 14% in 2017), consumer products and retail (20% in 2022 against 14% in 2017) and technology (20% in 2022 against 15% in 2017) have seen women’s representation on boards go up significantly in the last five years.

Covid-19 Impacted Progress | page 9

But in sectors such as energy and utilities, and banking and capital markets, the needle has not moved at all, remaining stagnant at 15% and 14%, respectively.

Covid-19 also impacted the progress in gender equality on company boards for a variety of factors including a defocus on the agenda amid a struggle to deal with the challenges of the pandemic.

Experts said a diverse board is the need of the hour.

“Now, more than ever before, you need a diverse board to innovate and grasp opportunities,” said Aashish Kasad, senior partner at EY India, and India region diversity, equity and inclusiveness business sponsor at the Big Four firm. “A diverse board enables holistic problem-solving and hence, intrinsically, companies with diverse boards perform better,” she told ET.

“Given the current dynamic business environment in terms of geopolitical tensions, economic uncertainties, inflation, scarcity of raw materials, breakdown of supply chains, etc, disruptive thinking and innovation is crucial when it comes to problem-solving,” Kasad said.

According to the EY report, more than 40% companies have gone beyond the regulatory mandated limit and have appointed more than one woman board member. But less than 5% of companies have women as chairpersons.

“The leadership pipeline in India Inc needs to be strengthened and the necessary toolkits need to be put in place,” Kasad said. “There should be equity and fairness in opportunities and promotions for women, with strong sponsorship of the leadership for high-performing women. Well-designed and robustly-enforced diversity policies and an enabling ecosystem will lead to more women attaining senior positions and consequently better gender diversity on boards in the medium term,” she said.

Saundarya Rajesh, founder president of Avtar Group, said diversity in corporate boards benefits the bottom line. Those in the top quartile of gender diversity in boards 21% more likely to outperform those in the bottom quartile, she said.

“However, we must ensure that diversity in boards does not result in tokenism and a tick in the box,” Rajesh said. “Boards should focus on social diversity (gender, ethnicity and age) and professional diversity (education, industry, experience, etc) for reaping the real benefits of a diverse board.”