“The current trajectory indicates that gender parity will likely be attained in the coming years”
A recent study by CIBC Capital Markets found that more women are now serving as board directors in Canadian companies listed on the S&P/TSX Composite. About 36% of board members are women, which is a big jump from less than 10% ten years ago. This shows that Canada is making progress towards having an equal number of men and women on company boards, and it might happen before the end of the next ten years.
According to Shaz Merwat, Director of Equity Markets at CIBC, the current trajectory indicates that gender parity will likely be attained in the coming years. This is a notable evolution considering that in 2017, nearly half of all sectors had yet to surpass the 20% threshold for female board representation.
An encouraging trend is the eradication of all-male boards within the TSX-listed companies. This signals a fundamental shift towards inclusivity and reflects the concerted efforts to promote gender diversity at the highest levels of corporate governance.
While gender parity has not been achieved across all sectors, significant strides have been made. The utilities sector emerges as a frontrunner in female board representation, with 41% of board directors being women, a substantial increase from 16% in 2012. Similarly, the financials and consumer staples sectors have seen notable improvements, with 40% and 39% female board members respectively, compared to 19% in 2012 for both sectors.
However, challenges are still there, particularly in sectors like healthcare, where women remain underrepresented on boards. Despite progress, only 28% of board directors in the healthcare sector are female, indicating a need for continued efforts to enhance diversity in leadership roles.
CIBC’s analysis also underscores the financial benefits of gender diversity in corporate boards. Companies with above-average gender representation have demonstrated higher total returns compared to those with below-average diversity. This trend suggests that diverse perspectives and experiences contribute to improved decision-making and overall performance.
