For every nine male directors, there was only one female director, in a report surveyed 550 listed corporations on the Pakistan Stock Exchange (PSX). The participation rate for female workers is significantly low. Consider there were only 11 female Chief Executive Officers out of a total 550. Alarmingly, of those appointed, more than 91% of female directors were either related or associated to majority shareholders in listed corporations. The message is clear—Pakistani corporations are not ready to ensure the due presence of women of Pakistan in Boardroom.
Male dominance in the boardroom has been a long-standing issue, with men historically occupying the majority of executive and leadership positions in corporations. Business leadership has traditionally been male-dominated due to societal norms and historical exclusion of women from decision-making role. Many leadership opportunities come through informal networks, which often favor men. Unconscious bias and stereotypes about leadership capabilities contribute to fewer women being selected for top roles. A lack of diversity can result in groupthink, reducing innovation and creativity in decision-making. Male dominance in the boardroom has significant implications for businesses, corporate culture, and the broader economy.
When a woman faces male dominance in the boardroom, she may experience a range of emotions and challenges, both professionally and personally. These feelings often stem from being in an environment where her voice is undervalued or overlooked.
She feels frustration and exasperation for being interrupted and ignored – Many women reports being talked over or having their ideas dismissed, only for a male colleague to later present the same idea and receive credit. She faces self-doubt and impostor syndrome. She always feels the need to prove herself. Women may feel pressure to work harder and be twice as competent to earn the same level of respect. Over time, being overlooked can lead to questioning one’s own abilities, even when highly qualified. A lack of female colleagues in boardrooms can make it difficult to find allies or mentors. With the result, she feels isolated and lonely. Woman is often excluded from Informal Networks – Many leadership decisions are made in informal settings (like golf outings or after-work parties), where women are often not included. Woman does not find any moral support while presenting her ideas in boardroom meeting at top level.
The lack of gender diversity at the highest levels of decision-making can lead to a range of negative consequences, both financial and social. A homogenous leadership team may suffer from groupthink, leading to a lack of fresh ideas and perspectives. Studies show that diverse teams are more innovative and adaptable, benefiting from different viewpoints and problem-solving approaches. Research suggests that companies with gender-diverse boards outperform those with all-male boards in terms of profitability and return on investment. A lack of diversity may lead to missed business opportunities, particularly in understanding and catering to diverse consumer bases. Studies suggest that diverse boards make better risk assessments and avoid overconfidence in decision-making. All-male boards may lack the ability to anticipate and navigate social, ethical, and governance issues effectively.
In an attempt to address gender-equality, the Securities and Exchange Commission Pakistan (SECP) issued a Code of Corporate Governance for listed corporations in 2019. The 2019 Code is predominantly based on a ‘comply or explain’ approach, reserving certain subjects as ‘mandatory’. Under the Code, it is ‘mandatory’ for every board to have at least one female director, failing which listed corporations’ risk being financially penalized. While this was a welcomed step, it has done—and is doing—little to address the glaring inequalities. Much more is needed to do so……….
