Companies
India Inc boardrooms have a mixed report card on diversity
Summary
There are winds of change in Indian boardrooms, with a splash of youth and diversity, but they still have a lot of distance to cover.
What does a typical Indian boardroom look like? While there are hues of diversity, it is mainly a grey-haired club where men still call the shots despite women gaining ground in boards. A Mint analysis of data of Nifty 500 firms sourced from primeinfobase.com showed close to half of the members of this coveted club are aged above 60 years, and millennials occupy just a minuscule 1.2% seats. Besides, the board composition remains heavily skewed towards non-executive directors, suggests data for the last five years. Additionally, in terms of gender diversity across firms of varied ownerships, multinationals lead ahead with the highest share of women directors. Mint explores further.
Balancing act?
A company’s board, which is a decision-making body, inherently demands the exercise of judgement. Therefore, an optimum size and composition plays a key role. While the board size of Nifty 500 companies has relatively remained stable over the years, the dominance of non-executive directors has inched up.
Age isn’t just a number
Age certainly takes precedence both in the case of promoters and non-promoter directors. While close to half of the directors are aged above 60 years, another one-third are in their 50s. On average, women directors are only four years younger to their male counterparts.
Gender skew
Thanks to regulatory measures, women have begun to get more spots in companies’ boards. Despite these hard-fought gains, they still are under-represented in the executive arena. Again, younger cohorts of women are thin on the ground.
Truly independent?
With around 50% board seats being occupied by independent directors, there is growing emphasis on their role. Almost 14% of the independent directors in the sample have tenures over 10 years but with upcoming potential vacancies (many of them are heading towards an expiration of their term by the end of this fiscal year), a big churn is expected at board levels.
Skill sets
The value these board members bring to the table is immense, which is reflective of their varied skill sets, expertise and educational backgrounds. In terms of educational qualifications, a majority of directors have a postgraduate degree followed by graduates. Public sector firms have more directors with doctorate degrees.
