…SEC, GSE advised
To ensure compliance with the principles of corporate governance, the Securities and Exchange Commission (SEC) and the Ghana Stock Exchange (GSE) have been advised to develop a system that rates companies based on their corporate governance practices.
A report on gender diversity in Ghanaian boardrooms, which was launched on Thursday, called on the two regulators to provide the relevant frameworks for companies to comply with the generally accepted principles of corporate governance.
The studies conducted by the University of Ghana Business School (UGBS), with the support of the International Finance Corporation (IFC) and the Swiss Confederation, focused on examining the nature of gender diversity in public and private sector boards in the country, as well as examine the relationship between gender diversity and organizational performance.
It notes that Ghanaian boards are most likely missing out on the rich experience a diverse board can provide.
Examining issues relating to gender diversity in different groups of firms, it was found that smaller, younger, welfare-oriented, unlisted organisations and state-owned enterprises (SOE’s) tended to have more females on their boards compared with larger, older, commercial, and foreign firms.
Even though the ideal is for organisations to have gender diversity, a majority, which is 77.85 percent of firms surveyed, did not have policies on gender.
Notwithstanding the absence of policies, 72.15 percent of the boards had female representation, and 6.49 percent of boards were chaired by women, even though the ratio of females to males remained low, with diversity typically ranging from 20 to 30 percent.
Gender diversity generally ranged from seven to 25 percent.
The number of women on boards ranged from one to six among the sampled firms, with the most common number of women on boards being one.
Findings from the research show that non-listed companies are doing better in having a gender-balanced board.
It highlights that, economically, it makes sense; for businesses that have a more gender-diverse board tend to have higher performance.
A World Bank Group report launched this month, focusing on the high cost of gender inequality in earnings, suggested that globally, countries are losing US$ 160 trillion in wealth because of differences in lifetime earnings between women and men.
The report further calls for the establishment of a pool of talented directors by the Institute of Directors, who have the requisite skills to serve on corporate and public boards in the country.
The institute is further advised to intensify training of women to prepare them to take up board appointments.
It recommended the need for policy advocacy to create more opportunities for females to serve on boards. Where policymakers, regulators, and organisations would think about developing policies that encourage young women to serve on boards.
By Joshua W. Amlanu