[Opinion] Gender Diversity in the Boardroom

Mahak Agarwal – [2024] 159 taxmann.com 238 (Article)

Diversity in the Boardroom, specifically gender diversity is in the limelight owing to the general awareness for breaking gender stereotypes and adopting a gender neutral board structure. While the Companies Act, 2013 and SEBI LODR Regulations have already taken their first steps towards implementing the same, considering the progress in global perspective, India still has a long way to go in increasing women participation in corporate boards . This article discusses the concept of Board diversity, specifically gender diversity, and the ways in which Indian corporate laws could take their next step in achieving a gender-diversified Board.

What is Board diversity?

The term ‘diversity’ literally means the state of being diverse or varied. In a boardroom, diversity may take several forms: ensuring the Board is equipped with an optimal mix of skills, expertise, experience and knowledge, ethnicity diversity with a mix of individuals form various racial, cultural and religious backgrounds, age diversity concerned with having a balance between younger and older personnel, geographic diversity for equipping the Board with individuals from various geographical locations, and gender diversity pertaining to having a gender-balanced boardroom.

Relevance of Gender Diversity in Indian context

For a very long time, Indian society has largely been patriarchal. A wide variety of literature available on this subject highlights the stigma attached with appointing women at leadership positions in India. While the same is, without doubt, on a continuous trend of improvement with India ranking 127 out of 146 countries in terms of gender parity in 2023, an improvement of 8 places since 2022, and 142 in terms of economic participation and opportunity, an improvement of 1 place since 2022, a large part of the socio-cultural population of India still looks at women only in the light of ‘great mothers’ and ‘home-makers’.

Gender diversity, in addition to being a persistent issue in the country, is also the topic of the hour as women across the country today are breaking the barriers of gender stereotypes and emerging as strong leaders, not just in personal roles but also in corporate leadership.

In an effort to catalyze such a shift and increase women participation on corporate Boards, the SEBI (Listing Obligation and Disclosure Requirements) 2015 (Listing Regulations) had also undergone change to adhere to the spirit of gender diversity.

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