More women in Indian boardrooms but diversity progressing at a snail's pace 

Little has changed in corporate boardrooms --although there are more women in leadership roles, disproportionate progress and fewer women are serving on more boards. Women representation of board seats increased by 9.4 per cent from 2014 to 17.1 per cent in India, but they comprise only 3.6 per cent of the board chairs, down by 0.9 per cent since 2018, according to Deloitte's Women in the Boardroom report.

The report found that globally, women hold 19.7 per cent of the board seats, which has grown by 2.8 per cent since 2018. At the current pace, the world could expect to reach near-parity only in 2045. In contrast, more Indian women have taken up CEO roles, albeit the rise has been marginal from 3.4 per cent in 2018 to 4.7 per cent in 2021.

The rise in women board members is attributed to the Companies Act, 2013, which mandated having one woman member on every board.

"While the Indian regulators have set up a holistic framework to encourage the representation of women in key positions at corporates, the numbers suggest a significant gap between the ideated measures and ground realities," said Atul Dhawan, Chairperson, Deloitte India.

Compared with men, a smaller group of women are taking on many more board seats and fewer women serve on more boards according to Deloitte Global's stretch factor metric. The metric examines how many board seats an individual holds in a particular market. The higher the stretch factor, greater the number of board seats the same director occupies. In India, the stretch factor for women increased slightly from 1.22 in 2018 to 1.30 in 2021.

Further, the average tenure of women directors has seen a marginal increase from 5.0 years in 2018 to 5.1 years in 2021, which, compared to global standards, has decreased from 5.5 years in 2018 to 5.1 years in 2021. The average tenure for women fell from 6.3 years in 2018 to 5.3 years in 2021 in the US, 4.1 years to 3.6 years in 2021 in the UK, and 5.7 years to 5.2 years in Canada.

The study found a positive correlation between appointing a female CEO and diversity on the board. Companies with women CEOs have significantly more women representation on their boards than those run by men − 33.5 per cent vs 19.4 per cent, respectively. The statistics are similar for companies with female chairs, with 30.8 per cent of women on boards where women are CEOs compared to 19.4 per cent with men as CEOs.

Similarly, gender-diverse boards are more likely to appoint a female CEO and board chair.

Men, by comparison, have a stretch factor of 1.20. The countries with the highest stretch factor for women—Australia (1.43), the US (1.33), and New Zealand (1.32)—have eschewed quotas in favour of voluntary approaches, such as non-binding targets.

"With the continuing disruption and the current pace of change, the case for diverse boards that work with a unified purpose is becoming stronger than it ever was. It is time that gender diversity and gender parity get more focused attention from Indian corporations," added Dhawan.