Growing awareness of diversity, equity and inclusion
Greater focus on diversity, equity and inclusion (DEI) has resulted in many policies and initiatives being put in place to push the development of women in leadership roles.
Under the Malaysian Corporate Code on Governance 2021, it is recommended that all boards should comprise at least 30% women directors. A review of the participation of women in senior management should also be conducted.
Michele Kythe Lim, President and CEO, Institute of Corporate Directors Malaysia (ICDM)
Boards should disclose in their annual reports, their company policies on gender diversity for the board and senior management.
Bursa Malaysia’s main market listing requirements makes it mandatory for public-listed companies (PLCs) to disclose the company’s policy on board composition.
As part of the efforts to empower women in leadership, the Securities Commission, under the revised Budget 2023, will run or roll out a special training programme to enhance skills, identify and increase the number of qualified women to be appointed as board members.
Board diversity should not be confined to just gender but cover multiple dimensions – age, background, ethnicity, experience and independence.
ICDM had successfully placed 27 women directors in 2022, with several first-time female directors on public-listed companies.
ICDM programmes are mindful of mitigating biases, and aim to cater to different needs, to ensure that all boards and directors, including women directors, can build their capacity.
As of March this year, ICDM has a membership base of 1,113 individual members, with 35% comprising female members.
Through the Board and Directors Effectiveness Evaluation, ICDM can support organisations in ensuring that their board composition is balanced, such as in the placement of women directors, and equipped to address any risks in relation to ESG matters.
Most of the required board skill sets (that usually reside with female candidates) are in human resources, marketing, innovation and sustainability, according to the Malaysian Board Practices Review report by ICDM in collaboration with Russell Reynolds Associates.
Yet only 8% of the respondents’ organisations sourced independently for their board members, despite knowing of the required skillsets.
ICDM can support organisations to make strategic, diverse and competency-based nominations of new board members.
Among the Securities Commission’s corporate governance strategic priorities, the aim is to strengthen board leadership and ESG governance fitness on boards, which includes accelerating the participation of women on boards.
ICDM has been appointed the service provider for delivering the Mandatory Leading for Impact Programme, Malaysia’s newly-introduced mandatory onboarding programme on sustainability for companies listed on Bursa Malaysia.
