Gender diversity on corporate boards is increasing but some regions are making more progress than others, according to a BNP Paribas Asset Management global study released March 6.
The study looked at women's representation in the manager's 3,250 portfolio companies and 21,000 companies in the Institutional Shareholder Services universe, at the end of December, when BNP Paribas Asset Management had €540 billion ($596 billion) under management.
On average, women held 29% of the board seats at companies held by the asset manager and 22% of companies in the ISS database. Both cases showed increases of 2 percentage points from 2022.
In Europe, where the European directive to promote board director equality has been in place for two years, the growth was 1 percentage point to 37%, with France topping the list.
The biggest changes from 2022 to 2023 within BNPP AM's portfolio companies were in Asia, which went to 18% from 14%; in Latin America, 19% from 14%; and Australia and New Zealand, 40% from 35%.
Asia, particularly Japan, averaged 17% of women across the boards of BNPP AM and 11% in the ISS universe, although Malaysia and Singapore had higher diversity rates.
The United States had 33% women directors in BNPP AM portfolios and 24% in the ISS universe. While that shows steady improvement, "it does not yet meet our standard," said Johanna Lasker, CEO of BNP Paribas Asset Management USA, in a release on the study. She noted that more than half the U.S. population is female, but factors keeping female board representation lower include low director refreshment rates, outdated recruitment methods and an aversion to setting quotas or targets. "This is not just about setting the right tone and advancing equity in the workplace, it is also about effective risk management," Lasker said.
Since 2019, BNPP AM has applied specific voting criteria on gender diversity regarding the election of corporate directors. In 2023, it rejected 48% of directors elections because of gender parity.
Starting in 2025 it will increase its minimum threshold to 40% of women on boards in Europe, North America, Australia and New Zealand, and South Africa.
