Empowering Business Resilience: Women Directors Shaping Niches and Adding Value in a Volatile Geo-Political Landscape
Divya Momaya is the Founder, visionary, and the driving force behind MentorMyBoard, Over the course of 20 plus years of her professional journey, Divya has donned various hats, including playing a key role in BSE& IPO Team and serving as Company Secretary of BSEL during its listing on BSE & NSE. Divya specializes in Due Diligence, Secretarial Audits, Mergers and Amamlga- mations, and Startup Advisory.
As we commemorate the 10th anniversary of the Com- panies Act 2013, which represented a significant stride towards gender equity in boardrooms, the glass appears both half full and half empty. While the Act mandated the inclusion of women directors on corporate boards, a decade later, women directors constitute 18.5% of the cumulative boardrooms, showcasing progress but also highlighting the substantial journey ahead. This is due to a variety of reasons, including the lack of access to opportunities, lack of mentoring and upskilling as well as limited access to platforms that can focus on the unique mentoring needs of deserving and aspiring women directors. Even before we proceed to understanding these challenges, it is imperative to delve deeper into the myriad benefits that women directors bring to the table.
While their impact on decision-making and resilience is evident, it is equally important to recognize how the presence of women directors contributes to the creation of ethically stronger boards and fosters an ecosystem of good governance, ultimately leading to more productive and sustainable business practices.
The Evolving Landscape
In the last decade, the inclusion of women on corporate boards has witnessed a transformative shift. From being a token representation, women directors are increasingly proving their mettle as strategic decision-makers. The positive impact of gender diversity on corporate performance is well-documented, with studies consistently showing that diverse boards lead to better financial results and improved innovation. However, with the current geopolitical uncertainties around the world and keeping in mind India’s march towards a 5 Trillion Economy, it is vital that we understand the urgent need for diverse perspectives and adaptive leadership, that comes with presence of women directors on the board, beyond the mandate of the Companies Act.
Here are some key aspects to be taken note of:
Resilience in Volatility
In times of geopolitical turbulence, businesses are confronted with unpredictable challenges ranging from trade wars to supply chain disruptions. Women directors, with their unique skill set and perspectives, can contribute significantly to steering companies through such uncertainties. Research indicates that diverse leadership teams are better equipped to navigate complex situations, as they bring a variety of experiences, thoughts, and problem-solving approaches to the table. Women directors, often adept at fostering collaboration and consensus-building, play a pivotal role in enhancing organizational resilience.
Ethical Leadership and Corporate Social Responsibility (CSR)
Women directors often bring a heightened sense of ethical awareness to boardrooms. Their commitment to ethical conduct and corporate social responsibility is a driving force behind the establishment of robust ethical frameworks within companies. Research indicates that businesses with diverse boards are more likely to prioritize social and environmental responsibility, thereby contributing to the overall betterment of society.
"This diversity enriches the decision-making process by reducing groupthink and fostering a culture of constructive debate"
Stakeholder Engagement and Trust Building:
The inclusion of women directors is associated with enhanced stakeholder engagement. Their ability to empathize and communicate effectively contributes to building trust among various stakeholders, including employees, customers, and investors. Ethical practices and transparent communication foster a positive reputation for the company, ultimately leading to sustained stakeholder confidence.
Risk Management and Compliance:
Women directors, often known for their meticulous attention to detail, play a pivotal role in risk management and compliance. Their focus on thorough due diligence and adherence to regulatory standards helps companies navigate complex legal landscapes. This commitment to compliance contributes to the overall resilience of the business, safeguarding it against legal pitfalls and reputational risks.
Diverse Perspectives for Informed Decision-Making:
Beyond gender diversity, women directors often bring diverse professional backgrounds, experiences, and perspectives to the boardroom. This diversity enriches the decision-making process by reducing groupthink and fostering a culture of constructive debate. In times of geopolitical volatility, the ability to consider a wide range of viewpoints becomes instrumental in making informed and resilient decisions.
Enhanced Innovation and Problem-Solving:
The collaborative and inclusive leadership style often demonstrated by women directors stimulates innovation within companies. Their unique problem-solving approaches contribute to the development of creative solutions, vital in addressing challenges posed by a volatile geopolitical environment. This innovation not only ensures business continuity but also positions companies to thrive amidst uncertainty.
Improved Board Dynamics and Team Cohesion:
Women directors often excel in fostering positive board dynamics and team cohesion. Their emphasis on inclusivity and open communication creates an environment where each board member feels valued. This, in turn, enhances collective decision-making and enables boards to function more productively.
The benefits of having women directors on corporate boards extend far beyond mere representation. In addition to their proven prowess in decision-making and resilience, women directors contribute significantly to the creation of ethically robust boards and foster an ecosystem of good governance. Their commitment to ethical leadership, stakeholder engagement, and innovative problem-solving not only enhances the overall reputation of the company but also positions it for sustained success in an unpredictable geopolitical landscape.
However, despite so many benefits, the finance minister, Smt. Nirmala Sitharaman had commented how hard it was to find capable women directors. This is also partially because of lack of access to opportunities, mentoring and upskilling platforms and also partially, as the FM put it, because women have inherent hesitations in the minds about their capabilities, especially when entering male dominated careers. And hence urgent need of capacity building and empowering women with right network and mentoring is critical, more so now!
As we celebrate the progress made over the past decade, it is crucial to recognize and amplify the multifaceted contributions of women directors, paving the way for more inclusive, ethical, and resilient corporate governance in the years to come.
As we commemorate the 10th anniversary of the Com- panies Act 2013, which represented a significant stride towards gender equity in boardrooms, the glass appears both half full and half empty. While the Act mandated the inclusion of women directors on corporate boards, a decade later, women directors constitute 18.5% of the cumulative boardrooms, showcasing progress but also highlighting the substantial journey ahead. This is due to a variety of reasons, including the lack of access to opportunities, lack of mentoring and upskilling as well as limited access to platforms that can focus on the unique mentoring needs of deserving and aspiring women directors. Even before we proceed to understanding these challenges, it is imperative to delve deeper into the myriad benefits that women directors bring to the table.
The positive impact of gender diversity on corporate performance is well-documented, with studies consistently showing that diverse boards lead to better financial results and improved innovation
While their impact on decision-making and resilience is evident, it is equally important to recognize how the presence of women directors contributes to the creation of ethically stronger boards and fosters an ecosystem of good governance, ultimately leading to more productive and sustainable business practices.
The Evolving Landscape
In the last decade, the inclusion of women on corporate boards has witnessed a transformative shift. From being a token representation, women directors are increasingly proving their mettle as strategic decision-makers. The positive impact of gender diversity on corporate performance is well-documented, with studies consistently showing that diverse boards lead to better financial results and improved innovation. However, with the current geopolitical uncertainties around the world and keeping in mind India’s march towards a 5 Trillion Economy, it is vital that we understand the urgent need for diverse perspectives and adaptive leadership, that comes with presence of women directors on the board, beyond the mandate of the Companies Act.
Here are some key aspects to be taken note of:
Resilience in Volatility
In times of geopolitical turbulence, businesses are confronted with unpredictable challenges ranging from trade wars to supply chain disruptions. Women directors, with their unique skill set and perspectives, can contribute significantly to steering companies through such uncertainties. Research indicates that diverse leadership teams are better equipped to navigate complex situations, as they bring a variety of experiences, thoughts, and problem-solving approaches to the table. Women directors, often adept at fostering collaboration and consensus-building, play a pivotal role in enhancing organizational resilience.
Ethical Leadership and Corporate Social Responsibility (CSR)
Women directors often bring a heightened sense of ethical awareness to boardrooms. Their commitment to ethical conduct and corporate social responsibility is a driving force behind the establishment of robust ethical frameworks within companies. Research indicates that businesses with diverse boards are more likely to prioritize social and environmental responsibility, thereby contributing to the overall betterment of society.
"This diversity enriches the decision-making process by reducing groupthink and fostering a culture of constructive debate"
Stakeholder Engagement and Trust Building:
The inclusion of women directors is associated with enhanced stakeholder engagement. Their ability to empathize and communicate effectively contributes to building trust among various stakeholders, including employees, customers, and investors. Ethical practices and transparent communication foster a positive reputation for the company, ultimately leading to sustained stakeholder confidence.
Risk Management and Compliance:
Women directors, often known for their meticulous attention to detail, play a pivotal role in risk management and compliance. Their focus on thorough due diligence and adherence to regulatory standards helps companies navigate complex legal landscapes. This commitment to compliance contributes to the overall resilience of the business, safeguarding it against legal pitfalls and reputational risks.
Diverse Perspectives for Informed Decision-Making:
Beyond gender diversity, women directors often bring diverse professional backgrounds, experiences, and perspectives to the boardroom. This diversity enriches the decision-making process by reducing groupthink and fostering a culture of constructive debate. In times of geopolitical volatility, the ability to consider a wide range of viewpoints becomes instrumental in making informed and resilient decisions.
Enhanced Innovation and Problem-Solving:
The collaborative and inclusive leadership style often demonstrated by women directors stimulates innovation within companies. Their unique problem-solving approaches contribute to the development of creative solutions, vital in addressing challenges posed by a volatile geopolitical environment. This innovation not only ensures business continuity but also positions companies to thrive amidst uncertainty.
Improved Board Dynamics and Team Cohesion:
Women directors often excel in fostering positive board dynamics and team cohesion. Their emphasis on inclusivity and open communication creates an environment where each board member feels valued. This, in turn, enhances collective decision-making and enables boards to function more productively.
The benefits of having women directors on corporate boards extend far beyond mere representation. In addition to their proven prowess in decision-making and resilience, women directors contribute significantly to the creation of ethically robust boards and foster an ecosystem of good governance. Their commitment to ethical leadership, stakeholder engagement, and innovative problem-solving not only enhances the overall reputation of the company but also positions it for sustained success in an unpredictable geopolitical landscape.
However, despite so many benefits, the finance minister, Smt. Nirmala Sitharaman had commented how hard it was to find capable women directors. This is also partially because of lack of access to opportunities, mentoring and upskilling platforms and also partially, as the FM put it, because women have inherent hesitations in the minds about their capabilities, especially when entering male dominated careers. And hence urgent need of capacity building and empowering women with right network and mentoring is critical, more so now!
As we celebrate the progress made over the past decade, it is crucial to recognize and amplify the multifaceted contributions of women directors, paving the way for more inclusive, ethical, and resilient corporate governance in the years to come.
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