Diversity Council Australia partnered with Deakin University on Australian first research to investigate cultural diversity in ASX Boards over the past decade. The findings released in March 2015 reveal that while cultural diversity on ASX boards has increased, boardrooms don’t yet reflect the cultural diversity in the Australian community and are failing to realise the potential benefits.
In each of ASX 100, ASX 200 and ASX 500 listed companies, only a quarter of directors are from culturally diverse backgrounds compared with a third in the wider Australian community, and only 5% are from Asian backgrounds versus 8.5% of the Australian community. But on the positive side, there has been significant growth in cultural diversity on boards in the last decade – by as much as 74% and 61% when it comes to chairs and directors from Asian backgrounds, and 16% and 22% for chairs and directors from culturally diverse backgrounds.
In our examination of the cultural origins of ASX-listed company board directors at three key time points – 2004, 2009 and 2013 – we found:
- Boards are getting more culturally diverse: 22% increase in directors from culturally diverse (non-Anglo-Celtic) backgrounds; 16% increase in Chairs from culturally diverse backgrounds; 28% increase in the number of ASX companies that have achieved a critical mass of directors from culturally diverse backgrounds
- The percentage of directors from Asian backgrounds is increasing: 74% increase in Chairs from Asian backgrounds (3.5% to 6.1%); 61% increase in directors from Asian backgrounds (5.9% to 9.5%); and 14% increase in CEOs from Asian backgrounds (4.4% to 5.0%)
- The percentage of directors from Southern, Eastern & Central European backgrounds is increasing: 20% increase in ASX directors and 63% increase in ASX 200 directors from Southern, Eastern & Central European backgrounds
- But there is slower progress in larger companies and among CEOs: 10% increase in ASX 100 directors from culturally diverse backgrounds v 22% increase among all ASX directors; 5% increase in ASX 100 directors from Asian backgrounds v 61% increase among all ASX directors; and 4% increase in CEOs from culturally diverse backgrounds v 22% increase in directors from culturally diverse backgrounds
- The top 5 Anglo-Celtic names dominate CEOs positions: 21% of ASX CEOs in 2013 were called only1 of 5 Anglo Celtic names (in order of frequency): David (68), Peter (53), John (48), Andrew (47), Michael (46)
- Boardrooms don’t yet reflect the cultural diversity in the wider community: In ASX 100-500 24% of directors are from culturally diverse backgrounds compared to 33% of the Australian community; and 5% of directors are from Asian backgrounds compared to 8.5% of the Australian community.
This report follows on from the first phase of research, Capitalising on Culture.
Members can access the full report.