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Asian Companies With More Women on Boards Deliver Better Results

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Asian Companies With More Women on Boards Deliver Better Results

​Southeast Asian and Chinese companies with more women on their boards delivered better financial results than those dominated by men, according to a study by the International Finance Corp.

Boards where more than 30% of members are women reported an average return on assets of 3.8%, compared with 2.4% for those without female representatives, according to the IFC study jointly carried out with the Women’s Empowerment Working Group and the Indonesia Stock Exchange. The return on equity for companies with more than 30% female board representation was 6.2%, beating the 4.2% rate seen at those with all-male boards, it showed.

More than 1,000 companies in China, Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam were surveyed for the study.

 “Our findings underscore the value of greater gender diversity in Asian boardrooms,” IFC’s Regional Director for East Asia and the Pacific Vivek Pathak said in a statement on Thursday. “By tapping into the vast potential offered by women in business, Asian companies can become stronger, more sustainable and more attractive to investors.”

Among Southeast Asian nations covered in the survey, Thailand is the most gender-diverse with women holding around 20% of board seats in listed companies, followed by Indonesia and Vietnam with about 15%, the study showed. Almost 40% of surveyed companies in Southeast Asia had no female board members, while only 16% had more than 30% female representation, it said.

 “The business case for board gender diversity is strong and relates not just to performance but also to corporate governance, reputation, and fairness,” said Risa E. Rustam, director of finance and human resources at the Indonesia Stock Exchange. “Stock exchanges can help lead the way by promoting gender diversity measures and targets among listed companies.” 

This article was originally published on June. 27th, 2019, for Bloomberg, Author Fathiya Dahrul 

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