A non-profit company is lobbying Parliament to boost the representation of women on corporate boards.
In a letter addressed to the Speaker of the National Assembly, Thandi Modise, the Directors Association requested that Parliament include a mandatory law in the Companies Act that would require boards to have a minimum of 40% of the members being women.
“This law would affect all JSE-listed companies, educational institutions and any organisation that adopts a formal board structure, including private business and nonprofits. It would also dictate to governmental organisations that use a board structure, at all levels (government, provincial and municipal, including state-owned entities),” Directors’ Association chairperson Munya Duvera said.
The association, which started in 2017, describes itself as “a nonprofit independent professional body that educates, equips and places nonexecutive directors on various boards across the country”.
Earlier this month, the Speaker responded to Duvera regarding his request to address the disproportionate representation of women in boardrooms.
“I wish to inform you that I have referred the submission to the portfolio committee on trade and industry, which, among other roles, exercises oversight in respect of the implementation of the Companies Act, to which your submission refers. I have simultaneously referred it to the portfolio committee on women, children and persons with disabilities for noting. I have requested the committees to keep me informed of developments in this regard.”
The Directors’ Association said that it was aware that there were not enough trained and board-ready women in the market to fulfil their 40% benchmark.
“Therefore, this quota should only come into effect in 2026, giving the market eight years (as of 2019) to train, equip and increase the pool of female director candidates.
“This will allow organisations to come into compliance with the legislation through internal policy change, succession planning and so forth.
“A board female quota is a necessary step that will increase board diversity which, according to the King Code [guidelines on corporate management], is good governance. But more importantly, a quota allows boards to make greater use of the vast intellectual competency that South Africa possesses in the form of highly skilled educated women,” the association said.
Their strategy is aimed at creating a competent, ethical and effective board that is “diversely balanced”.
“BoardRoom2026 is an eight-year campaign that attempts to address some of the biggest challenges faced by boards today. Launched in November 2018 and led by the Directors’ Association, BoardRoom2026 is intended to have a collective and collaborative effect that includes government, private sector, nonprofits and corporations.
“Its sole purpose is to solve issues that have plagued the boardroom, with the ultimate vision of creating the type of board that we want to see by 2026.”
A boardroom in 2026 should have the following characteristics:
. Greater female representation
. Sound corporate governance
. Competent, ethical and effective directors
. Compatible and equal value remuneration for both female and male directors
. Private and public skills deployment
. Cordial stakeholder relations
“The issues we are attempting to address are governance-related, including female board representation, transformation and social issues that are deeply rooted within our country, in which the board has a critical role to play.”