Gender diversity in the leadership of listed firms is becoming an increasingly important issue — with two-thirds of investors who took part in the 40:40 Vision investor survey stating that they plan to increase their company advocacy on the issue within the next 12 months.
The survey revealed that more than 90 per cent of respondents were engaging with their invested company boards on gender diversity topics and that 75 per cent were using their votes to drive diversity at the board level.
Alternatively, a third of respondents voiced that data shortages on gender diversity in companies served as a barrier against taking further action as part of their investments.
40:40 Vision was launched in October 2020 and is supported by industry partners who represent more than $6.3 trillion in funds under management (FUM).
Supporters are encouraging ASX300 companies to set medium and long-term targets for their executive leadership teams, with a pledge to achieve gender equality by 2030, as they want to see structural change in corporate Australia.
HESTA CEO and Chair of the 40:40 Vision Steering Committee Debby Blakey said results showed that investors sought a greater commitment to gender diversity and gender equality from ASX300 listed companies.
“We have some of the world’s leading investors as members of 40:40 Vision. The findings of this research send a clear message to listed companies: institutional investors want to see clear targets for gender diversity, strategies for achieving workplace gender equality, and transparent reporting of progress.
“Corporate cultures that are not inclusive and do not encourage diversity represent a clear financial risk to investors – this can negatively impact a company’s reputation, its productivity, and ability to attract and retain talent.
“There is clear evidence that better gender balance in leadership is not only fairer but also smart business – leading to better performance, better profits, and better corporate governance – and this creates long-term value for shareholders,” said Blakey.
The survey showed that investors were building discussions on gender diversity in their standard ongoing engagement with companies — addressing gender pay gaps, domestic violence policies, parental leave policies, board gender balance and workplace sexual harassment.
Target setting and reporting were identified as a key priority, along with managing their talent pipeline.
Blakey states that 92 per cent of the respondents have used the 40:40 Vision program to engage in gender diversity discussions with listed companies in the past 12 months.
“With only 17 per cent of ASX300 companies currently achieving gender diversity in executive leadership, we want to see more listed companies joining 40:40 Vision and putting robust systems in place to achieve gender diversity,” said Blakey.
CEW 2022 Senior Executive Census statistics showed that 36 per cent of ASX 300 companies have set a gender diversity target of at least 40:40, up from 29 per cent in 2021.