FICCI FLO Bangalore trains women to be women directors.

8:21 PM, Thursday, August 27th, 2015

Bangaluru : There is a now a large body of evidence that how company performance is affected by the presence of more women on boards. There are frequent reports by consultancies and companies that detail miraculous results achieved when organisations appoint more women to the board. For instance, one catering company launched a press release claiming that companies where women make up over one third of the board have 42% higher profit and 53% higher returns to shareholders.

One interesting recent study points out that companies with more women on the board tend to do better on the basis of objective measures, such as return on assets and return on equity.

Studies show that the presence of at least three women is necessary to change boardroom dynamics. In fact, an analysis of FTSE-listed boards found that operational performance and share prices were both higher in the case of companies where women made up over 20% of board members than those with lower female representation.

With such apparent benefits it should be lauded that SEBI has made women participation on boards mandatory. On 17 April last year, Sebi had ordered all listed firms to have an optimum combination of executive and non-executive directors with at least one woman director. On 15 September, the timeline to comply with the norm was extended to 31 March 2015. Companies that missed the deadline but appoint a woman director before 30 June would pay Rs.50,000 as fine.

Companies that do so between 1 July and 30 September 2015 will have to pay Rs.50,000 plus Rs1,000 a day from 1 July to the date of compliance.
Companies that comply with the norm after 1 October will have to pay Rs.1.42 lakh along with a fine of Rs.5,000 a day from 1 October till the date of compliance.

The only challenge is to find capable and available women directors. As part of its mandate of empowering women, FICCI FLO is committed to working with the business community to train and equip women with the necessary skills to perform this and other roles at the workplace.

FICCI FLO Bangalore in association with KPMG in India’s Governance Institute (working under the auspices of the KPMG Academy) has introduced a program to orient women in Bangalore with the necessary skills and knowledge to be a woman director.

The program includes a discussion on various topical issues relevant for new, existing and aspiring directors such as corporate governance, company law, and culture of effective boards.

“The change in the regulatory environment is going to play a major role in improving the gender ratio by leaps and bounds, and change the way women have been entering the workforce”, says Rati Dhandhania Mundrey, Chairperson FICCI FLO Bangalore. “We have crested this program to enable women to contribute more – both in family run business and elsewhere”.

Mritunjay Kapur, Head of Risk Consulting practice at KPMG in India says “Diversity – in terms of gender, qualifications, experience and background – at all levels of the company, including the boardroom, is highly desirable. The current regulations do attempt to put diversity at the top of board agenda, especially gender diversity, and this will definitely add value to the boardrooms. Through programs with industry bodies such as FICCI FLO we are attempting to help corporate India in increasing the available talent pool for ensuring more diverse boardrooms”

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