Renu Sud Karnad, managing director of Housing Development Finance Corporation (HDFC), sits on the board of seven companies. Ramni Nirula, former CEO and managing director of ICICI Securities, is also a board director in seven companies including Jubilant Foods and Avantha Power and Infrastructure. Former McKinsey executive Ireena Vittal is on the board of six companies including Wipro, Axis Bank and Tata Global Beverages.
A handful of accomplished Indian women find themselves pursued as India Inc scrambles to comply with the requirement to have at least one woman director on board from April 1. Not surprisingly, companies are favouring either family members or non-independent directors.
“We talk about young India, with enough lawyers and finance professionals who have done well for themselves. They need to be given a chance. But if companies don’t want to appoint strangers to boards, then even highly accomplished individuals can’t make it,” says Pranav Haldea, managing director at Prime Database group.
According to data from nseinfobase.com, developed by Prime Database, 32 per cent of the 1,475 NSE-listed companies had not appointed a woman director until February 21. The deadline now demands at least 12 appointments a day over the following month.
Credit Suisse’s global study on gender diversity and corporate performance found that between 2005 and 2011, companies with female board representation outperformed the others in terms of share price. Even their return on equity (ROE) was four per cent higher, at 16 per cent.
Among Indian companies, over the past year, 507 women have been appointed to 572 directorship positions. At least 141 of these positions are non-independent, while 80 vacancies were filled by women belonging to the promoter group. “These women shall have the same voice as the promoter, defeating the very purpose of genuine gender diversity,” says Haldea.
Abhay Gupte, senior director at Deloitte India, takes a different view. “You don’t get them just for the sake of gender diversity. An individual must have some experience and knowledge to be able to contribute to the board and participate in discussions. Today, you don’t have enough women with the experience to be independent (directors),” he says.
Head hunters are working overtime to find suitable candidates. “For effective board functioning, you need prior experience. And it is not easy to find such candidates,” says R Suresh, Managing Director – RGF Executive Search. Moreover, women hesitate to join the boards of companies that have a muddy record or are largely owned by a single family, he adds.
K Ullas Kamath, joint managing director at Jyothy Laboratories, agrees that while it is not easy to get talented women, a lot depends on the companies too. “Good companies don’t find it too difficult to attract talent,” he says.
B Thiagarajan, executive director at Blue Star, says the company did face some difficulties in finding the right candidate. “Directors should bring strategic value and it should not be an honorary position. We wanted someone who could bring in entrepreneurial values, had grown a business, knew market realities…” he says. Finding them all in one person was not easy. Finally, they found the perfect fit in Shobana Kamineni, executive vice-chairperson of Apollo Hospitals, who joined the board in June last year.
To be able to find suitable women directors, Thiagarajan says companies will have to necessarily promote as many women as possible to top management levels. “Then there will be a ready pipeline of talent for the board level,” he says.
Deloitte’s Gupte points out that each company has its own specific requirements, which can make the search for the right candidates extra challenging. “We will have to be a little patient… The essence of the requirement has to be understood and we will have to give it some time to mature,” he adds. Till then, it’s bound to be lip service to gender diversity in India Inc.