Without greater focus and action, gender parity in the boardroom is unlikely to be achieved before 2038
- Women hold less than one-quarter (23.3%) of the world’s board seats
- Since 2022, the number of women on boards has risen 3.6 percentage points and the anticipated timeline for achieving parity has dropped by seven years, but without increased momentum, gender parity in the boardroom will not be reached before 2038
- Just 8.4% of the world’s boards are chaired by women and 6% of CEOs are women
- At the current pace, reaching global gender parity for chairs and CEOs will not be reached before 2073 and 2111, almost 50 and 90 years from now, respectively
Deloitte Global recently released the eighth edition of Women in the Boardroom: A Global Perspective. The report reveals that women hold less than a quarter (23.3%) of board seats globally, a 3.6 percentage point increase since the report’s last edition was published in 2022.
Despite initiatives around the world to increase the number of women serving on boards, gender parity is unlikely to be achieved before 2038. And, there is no clear path to gender parity in the board chair or CEO role.
For parity to become a reality, a wide range of stakeholders would need to devote greater focus and action to help corporate boards more accurately reflect the societies in which they operate. And boards themselves would need to continue to take action and ask the right questions.
The latest edition of the report analyzed more than 18,000 companies in 50 countries and geographies, exploring representation of women in the boardroom, as well as insights on the political, social, and legislative trends behind these numbers.
“The business case for diversity is clear: companies with more diverse boards have shown that they tend to perform better financially. Despite that, it is clear that a tangible increase in momentum is needed to reach gender parity in the boardroom. With women currently still underrepresented on company boards globally, that step change in momentum will require organizations and investors to do more to realize the benefits that diverse boards can bring,” says Anna Marks, Deloitte Global Chair.
Government action is making an impact
Government action has yielded results in advancing parity at the board level. For instance, five of the top six countries with the highest percentage of women serving on boards in the study have some sort of quota legislation, ranging from around 33% (Belgium and the Netherlands) to 40% (France, Norway, and Italy). But quotas are not the only vehicle for progress. Continued government initiatives, such as the use of targets and disclosures, have also driven progress. For example, in the UK and Australia, women now hold more than a third of board seats. And while there is no magic number of board seats an individual director should hold, the geography-level data shows that the movement to increase gender diversity on boards has not caused “overboarding” as some may have feared.
However, government action alone is likely insufficient to reach parity. Stakeholders, including investors, should remain vigilant in setting expectations around gender diversity, despite the number of matters competing for investor attention.
In some countries, parity is found at the committee level
Across regions, particularly Europe, more women are chairing board committees. For instance, in Italy and France women hold a majority of board committee seats or committee chair roles, and more than 40% of European compensation committee chairs are women.
But there are stark differences between regions. For example, while women account for a majority of compensation committee chair roles in the UK (59%), Italy (57%), France (55%), and Ireland (51%), that figure drops to 27% in the US.
While it is encouraging to see women leading in these positions, more progress could be made in leveraging these committee chair roles to help women ascend to the board chair role.
Among chair and CEO roles, the glass ceiling seems impenetrable
While quotas and targets may help diversify boards, they do not seem to have the same effect on chair and CEO roles. Globally, the percentage of women chairing boards is nearly three times lower than the percentage of women serving on boards, with just 8.4% of the world’s boards being chaired by women.
When it comes to the highest executive roles, women’s representation drops even further: only 6% of CEOs in the world are women, representing just a 1% increase from our previous edition. At the current rate of change, global parity for CEOs would not be reached before 2111—almost 90 years from now.
Since many companies prefer to recruit board members with CEO experience, these numbers do not paint an optimistic outlook for pipeline development. Companies should expand their skills profile requirements to further diversify their boards and shore up critical skill gaps.
What is the financial services industry getting right?
In 30 of the countries analyzed in the sample, the financial services industry (FSI) was the first or second most gender-diverse industry in that market—nearly double that of the next highest industry. Why is the financial services industry leading the way in so many of these markets? Deloitte US research on the industry may reveal some clues. Over the past decade, more women have been added to FSI C-suites than men. As boardroom gender diversity in financial firms has also increased during that time span, we may be seeing a virtuous cycle play out across the industry in real time. Organizations in the financial services industry—and beyond—should increase their efforts to build the pipeline of future women leaders so that progress can be sustained and enhanced into the future.
“Today, board agendas are more packed than ever before—and the challenges and emerging areas boards need to keep abreast of are only increasing. As organizations aim to build more equitable and balanced boardrooms and C-suites, with real diversity of thought, directors need to remain focused on gender parity to advance progress.” continues Marks. “Business leaders across markets should commit to collaborating on these matters; sharing their challenges as well as their successes, having the courage to ask difficult questions, and doing their part to help accelerate the timeline for achieving gender parity in the world’s boardrooms and C-suites.”
To read the full report, please visit: Women in the boardroom | Deloitte Insights
