23 October 2018
Fern Ngai says many Hong Kong companies remain complacent about gender diversity on their boards. Photo: EJ Insight
Fern Ngai says many Hong Kong companies remain complacent about gender diversity on their boards. Photo: EJ Insight

Female board members in HK still lag global counterparts

The proportion of women on the boards of the companies on the Hang Seng Index (HSI) has risen to 11.1 percent this year from 9.6 percent last year.

It is the highest ratio in five years but still falls behind those of their global counterparts, a study shows.

Out of 655 directorships at the 50 blue-chip firms that make up the HSI, 73 are held by 64 different women.

In comparison, 64 of 668 directorships were held by 53 different women in 2014.

These are among the findings of the latest Women on Board Hong Kong report conducted by Community Business, a non-profit organization that focuses on corporate responsibility.

HSBC Holdings (00005.HK) is the company that has the highest representation of women on its board in Hong Kong. The number has increased to six this year from four, out of a total of 17 directors.

Next comes Link Management Ltd. (00823.HK), which has four women on its 13-member board, followed by China Resources Power (00836.HK), which has three female board members but reduced the size of its board to 11 from 13.

Hong Kong still lags behind places like Britain, where women make up 23 percent of directors, Australia (19.2 percent) and the United States (also 19.2 percent).

Britain’s female representation in boards has seen an improvement of 10.8 percentage points in the past five years, while Hong Kong has only had an increase of 2.2 percentage points in the same period.

“Hong Kong’s flat trajectory [over the past years] suggests that the efforts of other countries are currently proving more effective than those in Hong Kong,” said Fern Ngai, chief executive of Community Business.

Greater board diversity can bring about benefits like higher creativity, innovation and better corporate governance, she said.

Seven companies have never had a woman on their boards since the annual study was first done in 2009: China Merchants Holdings (Intl) Ltd. (00144.HK), China Resources Enterprise Ltd. (00291.HK), CNOOC Ltd. (00883.HK), Petrochina Co. Ltd. (00857.HK), Tencent Holdings Ltd. (00700.HK), Bank of East Asia Ltd. (00023.HK) and Hong Kong and China Gas Co. Ltd. (00003.HK).

“Multinational companies are usually more sophisticated in terms of understanding the business case for having an inclusive and diverse workplace, not just on gender diversity, but in other areas, like LGBT [lesbian, gay, bisexual and transgender],” said Ngai.

She said many companies in Hong Kong are family businesses and tend to be more patriarchal.

“The chairman runs the board … I would say that those companies should definitely be looking at not just expanding the gender diversity on their boards but other diversity, like age, culture and so on,” Ngai said.

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EJ Insight reporter

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