'We can't be ignored any more', Sitharaman bats for more women on boards, in top positions

FM Nirmala Sitharaman addresses the 'Women Directors' Conclave 2022' in Mumbai on September 16 (Image: Twitter/ NSitharamanOffice)

The industry needs to have more women on boards as well as in leadership roles and also widen the pool for such candidates, finance minister Nirmala Sitharaman said on September 16.

"There is just no excuse (not to have more women on top corporate posts)," the minister said at a Women Directors Conclave at BSE in Mumbai. "We cannot be ignored any longer."

The average number of women on Indian boards was 1.03. As many as 58 percent of those were independent directors, while 42 percent were non-independent, she said. Data shows companies with women on their boards turned more profit, the finance minister said.

“We are not asking for inclusivity; we are not asking for gender parity. You want more profit, get me in,” Sitharaman, the first woman to independently hold the charge of the finance ministry, said.

The market regulator required large listed companies to have at least one women director on their boards, the minister said.

Yet, while the overall number of women directors had increased gradually, there were still several companies, including public-sector banks and undertakings, which didn't have a single women director, the minister pointed out.

She warned that attempts to evade the provisions of the companies law with respect to the appointment of women directors were being tracked.

Widen the pool

The Nifty50 companies have often hired the same women to their boards, Sitharaman said.

“Fourteen women hold five-to-six directorship positions across NSE-listed companies, while seven hold seven directorship positions each—that is a very revealing number. It doesn’t have to be so concentrated,” she said.

The government couldn't nudge the companies any more to get more women on boards, the pressure needed to come from the corporate world society itself, the minister said.

She questioned so-called men’s clubs setting the norms, adding that having women on boards checks the comfort zone and bring a material difference.

“It cannot be a comfortable men’s club. You have to get in there with your perspectives,” the minister said

Both men and women required training, Sitharaman said, as she questioned the quality of some of the men on company boards.

Directors have to be constantly on vigil on global corporate governance standards, and the markets and should have their own sources of information, the minister added.