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Australia cracks the 30% threshold for women on ASX200 boards

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Although gender disparity in business leadership is still a huge issue, a recent study shows that the gap is beginning to close in some areas

The University of Queensland report found that the amount of women sitting on ASX200 boards has risen from 8.3% in 2008 to 33.6% in 2021.

This makes Australia one of three countries to crack the 30% threshold without any legislated quotas.

Key driving factors include the AICD’s board mentoring program, reporting on diversity and public campaigns

Dr Miriam Yates co-authored the study along with Dr Terrance Fitzsimmons and Professor Victor Callan.

She said more transparent reporting on diversity within the ASX Corporate Governance Council is a key driver behind the shift.

“We know from the research that formalised mentoring can be the catalyst for ‘opening the door’ to under-represented group members within the workplace,” she said.

The report also found that public campaigns from institutional investors, as well as the establishment of the 30% Club Australia helped drive the increase.

“In many ways, this change was cumulative, with each initiative building on the work of that which had come before,” Dr Yates said.

percentage-of-female-directorships-on-asx200-boards
Source: Statistics are based on the Australian Institute of Company Directors research. Company rankings data provided by Market Index. Quarterly rebalance information provided by S&P.

However, the news wasn’t all positive

The researchers also found that a lack of affordable childcare and stereotyping have continued to act as barriers to women.

The report made a total of seven recommendations, including:

  1. The establishment of a formal alliance of key influencers
  2. The reinvigoration of board readiness and mentoring programs
  3. The adoption of a 40/40/20 target for board gender parity. (40 per cent female, 40 per cent male, and 20 per cent either way)

The executive of Women on Boards Claire Braund described the news as encouraging. However, she also said growth hasn’t translated through to leadership positions.

“There is not really any significant trend for the number of female chairs or CEOs on ASX200 boards. Nor is there any uptick in the number of culturally diverse directors,” Braund said.

Currently, only one in ten blue chip company chairs is a woman.

“The worst sector for representation of women on ASX boards is the ASX200+ where the number of women effectively drops off a cliff.”

The report also highlighted this trend: “Australia’s continued improvement in board diversity sits in stark contrast to our diminishing position in terms of most other gender equality indicators, including gender diversity among top executives.”

“This phenomenon is replicated in countries where quotas on boards have led to the highest rates of female board participation; such as France, Sweden, and Germany. These markets also continue to see stubbornly low levels of female executives.”

Trend in the percentage of women ASX200 board members versus women ASX200 CEOs

The researchers traced the increase in the ASX boardroom gender diversity back to 2009

“The nation had its first female Prime Minister and Governor-General; we were in the grip of the Global Financial Crisis; and the media in many countries was highlighting the lack of diversity on company boards,” Dr Yates said.

AGEC chair Coral Ross said the report highlights important lessons as Australia works towards equity in other facets of society.

“The achievement of more than 30 per cent of women on boards is even more remarkable given Australia’s lack of progress in other gender equality measures,” she said.

A Selection of 2009 Board Gender Diversity Articles and ASX Featured in the
Australian Financial Review

“It’s the mosaic of all the players that has enabled this change”

“What became apparent during the research was that there was no single institution or group of institutions that coordinated the changes and initiatives that led to the increase of women board members.”

“The systemic barriers to women’s progression in the workforce remain unaddressed and are responsible for a shrinking pipeline of women into leadership positions,” she said.

“A further identified barrier was the current board skills matrix, which favours CEO experience for board positions. When just 5 per cent of CEOs are women.”

Natasha is an Associate Producer at ticker NEWS with a Bachelor of arts from Monash University. She has previously worked at Sky News Australia and Monash University as an Online Content Producer.

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Money

Boeing CEO to depart with lucrative exit package despite chaos

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Boeing CEO Dave Calhoun is set to step down from his position at the end of the year, walking away with a substantial payout despite challenges faced during his tenure.

Here are the key points:

  • Massive Payout: Despite Boeing’s stock price plummeting by 43% since Calhoun took over as CEO in 2020, he is poised to receive a $24 million payment upon his departure.

  • Additional Compensation: Calhoun holds options that could potentially earn him an additional $45.5 million if his successor manages to boost Boeing’s share price by 37%.

  • Comparative Compensation: Calhoun’s compensation during his tenure exceeds that of CEOs in similar industries, despite Boeing’s stock underperforming in comparison.

Boeing CEO Dave Calhoun’s impending departure at the end of the year has sparked controversy as he stands to walk away with a substantial payout, despite the company’s tumultuous journey under his leadership.

READ MORE: Boeing CEO to step down

Despite inheriting a company reeling from the aftermath of two deadly 737 Max crashes, Calhoun’s tenure has been marred by further setbacks, including the recent Alaska Airlines door blowout incident that further tarnished Boeing’s reputation.

Boeing offers CEO $5.3 million incentive to stay through recovery …

With Boeing’s stock price plummeting by 43% during Calhoun’s time at the helm, questions arise about the correlation between executive compensation and company performance, especially in the face of such significant challenges.

‘Raised eyebrows’

Calhoun’s lucrative exit package, valued at $24 million, has raised eyebrows among shareholders and industry observers alike.

Additionally, the potential for Calhoun to earn an additional $45.5 million based on the future performance of Boeing’s shares has intensified scrutiny over executive compensation practices.

This sizable payout contrasts starkly with Boeing’s stock performance, which has significantly underperformed compared to both industry peers and broader market indices, highlighting the dissonance between executive rewards and shareholder value creation.

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Money

It’s been a record year for CEO compensation

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In 2023, Broadcom’s CEO Hock Tan was granted a stock award worth $161 million, propelling him into the realm of highest-paid CEOs.

However, as the company’s share price surged, the value of Tan’s award skyrocketed to approximately $1.3 billion, outpacing even the shareholders’ annual returns.

Tan’s compensation reflects a broader trend among top executives in the tech sector, where awards of restricted stock and stock options surged in value alongside company share prices.

Notably, CEOs like Charles Robbins of Cisco Systems and Shantanu Narayen of Adobe also saw substantial increases in their compensation, doubling in some cases.

The disclosure of such equity growth in executive compensation is a new requirement by the Securities and Exchange Commission (SEC), providing shareholders with insights into the changing value of executives’ awards throughout the year.

CEO pay is on the rise.

New heights

Overall, CEO pay at major S&P 500 companies reached new heights in 2023, rebounding from slower growth in the previous year. The median pay for these CEOs rose to $15.6 million, up from $14.1 million in 2022, reflecting a surge in equity awards.

Broadcom clarified that Tan’s stock award is designed to span five years, with no plans for additional equity grants or cash bonuses during that period.

Tan’s compensation, which amounts to approximately $33 million annually over five years, is contingent upon his continued tenure and specific share price targets.

While the initial valuation of Tan’s restricted shares stood at $160.5 million, the surge in Broadcom’s share price prompted the company to reassess the likelihood of meeting vesting conditions.

This reassessment suggests that Tan may not receive all the shares initially granted.

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Money

Market forecast: weather whirlwinds influencing investments

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Prime conditions for commodity investments arise from global weather shifts, geological tensions, and rising interest rates.

With global weather patterns causing disruptions in traditional supply chains, coupled with geopolitical tensions over natural resource access, and the anticipation of higher interest rates impacting financial markets, the conditions for commodity investments have reached exceptional levels.

Amidst this backdrop, Farrer Capital has emerged as a standout player, leveraging its unique ‘blue ocean’ approach to capitalize on price dislocations and scarce competition in the market.

Mark Wyld from MW Wealth joins the show to share his insights on the inclement weather impacting the market.

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