Ninety-six per cent of Boards now have female directors
Women made up more than one-third of all new appointments to the boards of Canada's 100 largest publicly traded companies in the last six years, finds 'Are we making a difference?' a new research report conducted by KPMG in Canada. Almost all now have at least one female director, a jump of nearly 30 per cent since the country's 'Comply or Explain' gender diversity mandate came into effect in 2014.
"Canadian organizations have made great strides on gender equity at the Board level over the last six years – both in terms or the number and quality of members," says Kristine Remedios, Chief Inclusion and Social Impact Officer at KPMG. "Just six years ago, one-third of these boards were all-male – today it is just one in 25.
"When 'Comply or Explain' was introduced there were concerns that companies would add underqualified token directors, insiders or a small group of women would be appointed to multiple boards in order to achieve compliance. Our research has found those concerns to be unfounded. The women appointed over the last six years bring a wealth of experience and expertise to their roles."
Key research findings on Board appointments
The KPMG report found women appointed to Boards were slightly younger than their male counterparts, more educated, far more likely to come from outside the organization and more likely to participate on key Board committees. They were also slightly more likely to have already been on another board.
While significant progress was made over the past six years, KPMG found that far fewer of the women appointed as directors were actively employed. Only 34 per cent of the women were working, with half of them holding C-Suite positions. Whereas, more than half of the men appointed were actively working and two thirds of them held C-Suite roles.
KPMG also looked at the gender composition of the executive appointments made by these same 100 Canadian companies over the same six-year span. It found that only 24 per cent of roles went to women during this time. Of these, 39 per cent were C-Suite appointments, whereas 47 per cent of appointments given to men were at the C-Suite level.
While the newly appointed women to Boards were, on average, much more educated than their male counterparts, those appointed to executive roles tended to be less educated.
The number of women named to executive roles with advanced degrees was 21 points lower (43 per cent) than at the Board level over the last six years. The men appointed to executive roles were, on the other hand, more educated (59 per cent) than both their female counterparts and the men appointed as directors.
"The fact that only a third of the female directors appointed over the last six years were actively working and that women are not making significant progress gaining executive roles in Canada's largest companies raises some questions about where the next pool of female directors will come from," says Doron Melnick, Partner and National Leader, People & Change Services, KPMG in Canada.
"Traditionally, the majority of directors have come from the executive ranks so much more work is required to not only grow but sustain these positive changes. This will require Canadian companies to do more to support the career development of women. The disproportionate impact of the COVID-19 pandemic on women – in particular working mothers – calls for new and responsive strategies. Failure to do so threatens to turn the clock back on diversity and erode the clear benefits that diverse leaderships bring organizations."
About the KPMG 'Are we making a difference?' report
To compile the report, KPMG examined all director and executive appointments to Canada's largest 100 Canada Business Corporations Act (CBCA)-governed public companies, as measured by market capitalization, between May 31, 2014 and May 31, 2020. All data was collected from the Toronto Stock Exchange (TSX) website, AIFs, proxy circulars and company websites.
About KPMG in Canada
KPMG LLP, an Audit, Tax and Advisory firm (home.kpmg/ca) is a limited liability partnership, established under the laws of Ontario, and the Canadian member firm of KPMG International Cooperative ("KPMG International"). KPMG has more than 7,000 professionals/employees in over 40 locations across Canada serving private- and public-sector clients. KPMG is consistently recognized as an employer of choice and one of the best places to work in the country.
The independent member firms of the KPMG network are affiliated with KPMG International, a Swiss entity. Each KPMG firm is a legally distinct and separate entity and describes itself as such.
For more information, please contact:
Director, Corporate Communications
KPMG in Canada
416 777 8026
© 2021 KPMG LLP, an Ontario limited liability partnership and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
For more detail about the structure of the KPMG global organization please visit https://home.kpmg/governance.