ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) has stated that financial performance is better in companies with more women working in the firm.
According to a recent report by SECP, titled ‘Women on Board,’ the impact is seen primarily across three variables, i.e., the number of women on board, the number of independent women directors, and as chairpersons.
According to the report, the data from Pakistan show a definite positive impact of the SECP regulations on board gender diversity in the listed companies.
Women directors have increased by 3 percent since the regulations were introduced. The proportion rose from 8.8 percent in 2017 to almost 12 percent in 2019. Considering that the percentage remained constant between 2015 and 2017, the growth could be attributed to the introduction of the 2017 Regulations.
The SECP regulations also caused a proportionate increase in the number of female independent directors. In 2015 and 2017, the number of such directors was almost constant, at 17 and 16, respectively. However, it rose to 51 in 2019. At the same time, the number of Chairwomen increased from 24 to 33, registering an increase of 37.5 percent.
Sectors such as finance, textile, manufacturing, pharmaceutical and chemical, engineering and automobile, and energy have shown the highest increase in the number of women directors.
The textile and manufacturing sectors have the highest number of woman directors, 75 and 74, respectively. Concerning the proportion of female chairpersons, the textile sector shows the highest increase, from 8 in 2017 to 13 in 2019, while the energy sector also doubled its number of women chairs.