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CGIO had undertaken groundbreaking research on the representation of women in corporate boards in Singapore and beyond. Our reports  are now the global benchmark in boardroom diversity for Singapore and Indonesia.

Board Diversity and Business Performance in Singapore-Listed Companies. The Role of Corporate Governance

Using econometric techniques, CGIO conducted a study that established a link between board gender diversity and company’s financial performance, acting through corporate governance. This is a necessary condition towards establishing a definitive causality between these two aspects.

This study is important as there has been much debate and skepticism on whether board gender diversity has positive impact on a company’s financial performance. While there were some consulting and corporate studies that point to favorable impacts, it does not help that the stream of academic studies generally showed non-existent or very weakly positive effects.

Associate Professor Lawrence Loh, Director of CGIO, NUS Business School, said, “Up to now, studies across the world have found that the impact of board gender diversity on financial performance is either non-existent or weakly positive. Through econometric techniques, our study is the first in the Singapore context to establish that such a relationship exists through corporate governance.”

The results were announced at a seminar “Resolving the Performance Puzzle of Board Gender Diversity” organised by the Diversity Action Committee (DAC) on 29 June 2018. The presentation slides can be accessed here.

More details about the event can be accessed via the 29 June 2018 event tab.

The full journal article can be accessed here.

Summary of the Study

The CGIO study investigated the relationship between board gender diversity and corporate governance score, and between these variables and financial performance, using ordinary least squares (OLS) regression models.

The study used a combination of publicly available data of director profiles, company corporate governance scores from the Singapore Governance and Transparency Index (“SGTI”) and company financial performance indicators obtained from Bloomberg.

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Key findings

  • Board gender diversity was found to have a positive and statistically significant impact on corporate governance score.
  • Corporate governance score was found to have a positive and statistically significant impact on company financial performance.
  • No direct effect by board gender diversity on company financial performance was found.
  • There is a positive linear relationship between the number of female independent directors and company financial performance. That is, in general, financial performance of companies with more female independent directors would be better than those with fewer or no women on the board .

Conclusion

  • The findings suggest that board gender diversity has an indirect effect on financial performance, acting through its intermediate effect on corporate governance scores.
  • The results infer probable causality between women on the board and corporate governance score, and as a result to financial performance. The findings are a necessary though not sufficient condition to prove causality.
  • The regression study also provides a framework to make predictions about a company’s financial performance based on board gender diversity as well as other explanatory variables pertaining to board and firm characteristics.
  • The effect of the fraction of female independent directors on Tobin’s Q (ratio of market value with book value), which was positive and statistically significant, would suggest that companies should pay more attention to the number of female independent directors on their boards.

1 Both return on equity (book measure) and Tobin’s Q (hybrid measure) were considered.
2 It should be noted that the sample has a maximum of three female independent directors. Thus caution must be exercised to extrapolate the relationship beyond this number.

Korn Ferry Diversity Scorecard 2016 - 

Asia Pacific Board Diversity Report 2016 - Building Diversity in Asia Pacific Boardrooms

The fourth edition of the Korn Ferry Diversity Scorecard series tracks board composition of companies in ten economies across Asia Pacific including Australia, China, Hong Kong, India, Indonesia, Japan, Malaysia, New Zealand, Singapore and South Korea. Click here to download the report.

This project is proudly sponsored by:

Click here for a copy of the presentation slides.

CGIO released the report on 19 April 2016

Korn Ferry Diversity Scorecard - 2015

The 2015 report is the third in the Korn Ferry Diversity Scorecard series. The scorecard tracks the diversity performance of major economies in the Asia Pacific market, with special focus on gender representation on corporate boards. This report covers 10 economies: Australia, China, Hong Kong, India, Indonesia, Japan, Malaysia, New Zealand, Singapore, and South Korea. We selected the top 100 listed companies by market capitalisation for each country and based our study on the data contained in the companies' annual reports for 2013.

This project is proudly sponsored by:



Click here for a copy of the presentation slides.

CGIO released the report on 6 March 2015:

Singapore Board Diversity 

The Singapore Board Diversity Report is a joint initiative of CGIO and BoardAgender an outreach arm of the Singapore Council of Women's Organizations (SCWO) Women's Register initiative.

This project is proudly sponsored by:

CGIO has released 4 reports so far that reflect the boardroom gender diversity scene in Singapore: 

2014 2013 2012 2011

Indonesia Board Diversity 

The Indonesia Board Diversity Report is a joint initiative of CGIO and GlobeAsia, Indonesia. This is the first report to provide an in-depth analysis of the boardroom gender diversity in the companies listed on the Indonesia Exchange (IDX).

View the full report here:

collaboration Opportunities

At CGIO, we aim to deliver thought leadership, centred in Asia, with a global influence that contributes to organisational excellence and sustainability. As a research centre, we welcome collaboration opportunities and support from companies, trusts, foundations and individuals. If you are interested in research collaborations or funding our research efforts, please contact Ms Verity Thoi, Manager: Verity.Thoi@nus.edu.sg