A recent study by Credit Suisse shows Hong Kong and mainland China are seeing more women appointed to leadership roles in business organisations.
But both markets are still lagging way behind leading overseas markets, meaning a lot more needs done to achieve better gender equality at board level.
The Credit Suisse Gender 3000 tracked 27,000 senior managers at over 3,000 companies globally, and shows both China and Hong Kong have made solid progress over the past six years.
The mainland had 9.2 per cent of its board positions filled by women at the end of 2015, edged up 0.1 percentage from 2014 and up from 8.8 per cent in 2010.
In Hong Kong it was 11.4 per cent, up from 10.6 per cent in 2014, and 8.9 per cent in 2010.
China leads the world when it comes to women chief financial officers, with 22 per cent, ahead of the 14.1 per cent global average. And the mainland also scored highly in terms of diversity of “senior management”, rising to 17.2 per cent this year, up from 15 per cent in 2014, and two percentage points higher at 16.8 per cent over the past two years.
Those figures show we are moving in the right direction, but they still look bad when compared with western markets.
The global ratio of female board members was 14.7 per cent at the end of 2015, up from 12.7 per cent at the end of 2013. The top five countries were Norway at 46.7 per cent, France (34 per cent), Sweden (33.6 per cent), Italy (30.8 per cent) and Finland (30.8 per cent).
In the Asia Pacific region, Australia had the highest percentage, with 20.1 per cent of board members female.
This may lead many to consider what’s needed is a quota system, as is the case in Norway and France.
In the former, all listed companies have to have at least 40 per cent of directors female, while France will require from next year that listed companies with more than 500 employees have at least 40 per cent of their board membership female. Any that fail to comply have their directors’ pay withheld.
Companies in Hong Kong and mainland China should be praised for their efforts at bringing more women into the board room – but the pace of change is still too slow.
A quota system of some sort might be a good start.
Some consider quota systems can be justifiably criticised as being simply token appointments, when merit might not be justified.
But consider this: the Credit Suisse report also shows the higher the percentage of women in top management, the greater the returns for shareholders.
It said that between the end of 2013 and mid-2016 companies with 25 per cent of management roles filled by women recorded 2.8 per cent growth in the price of their shares, those with 33 per cent female managers recorded 4.8 per cent growth and those with more than 50 per cent recorded 10.3 per cent. This compares to an overall average share price fall of one per cent.
The market is willing to pay a 19 per cent premium price to book multiple for companies with high women representation and a female chief executive, the reports suggests.
And those companies show return on equity, 19 per cent higher on average deliver a 9 per cent higher dividend payout.