Women's representation in board room dismally low: Report

{image-business women group1_24012008.jpg news.oneindia.in}Mumbai, Jan 24: Representation of women in the elite corporate affairs remains dismally low compared to their male counterparts despite talks of women empowerment.

According to the 'Corporate Governance Research Report on Indian Companies', ninty percent of the 30-sensex companies in the country are being governed by male directors. Stating that the diversity on the board, per say, was an important factor in governance, the report said that the same was true for gender diversity. ''If we look at the score card of corporate India, the number of female directors in Indian companies fall short, compared to the male directors. In fact, it is dismally low,'' the report said.

Suggesting the corporate world to make conscious efforts to bring more women on their board, the report says that a higher representation of women in the corporate governance would help in reaping obvious diversity on the board.

The report has been brought out by the Indian Merchants Chamber. Dwelling on other issues of corporate governance, the report found that of the 30 companies covered under the research, more than three fourth had separated the position of chairman from that of managing director or chief executive officer (CEO), while remaining nearly one-third of the companies had them combined.

The research reflects that the country has recognised the logic that role of the board is to govern and not micro manage. By this logic, it is desirable to separate head of the board (chairman) from the head of management (CEO and MD), the report said.

On the compensation of non-executive directors in the state-owned enterprises vis-a vis the ones in the private sector, the maximum compensation to an independent director in the private sector is Rs 33 lakh per annum (TCS), the same for an independent director in a public enterprise was Rs 15 lakh per annum (NTPC).

The report has suggested for higher compensation, if the PSUs were to attract good quality independent directors.

The report said that as the world was moving towards greater transparency, the belief that 'good governance is good business' is gaining ground.

This fact is reflected in the profitability of better governed companies,'' the report said.

According to the report, 11 companies of the 30 companies have achieved a healthy profit between 20-30 percent. These companies include Bharati Airtel, Cipla, and Grasim.

In addition, six other companies have achieved even higher profitability between 30-35 per cent, which include Infosys, HDFC, ITC, Ambuja Cement and Dr Reddy's Labs.

Sector wise, while maximum profitability in the private sector was 34.81 per cent, the same was 37.88 per cent in the public sector like ONGC, SBI, NTPS, SBI and BHEL etc. On the other side, the minimum profitability in the private sector was 10.94 per cent, but a slightly higher in public sector with 18.94 per cent.

''The high profitability of PSUs like ONGC, SBI, NTPC, and BHEL should be an indicator to the government that the disinvestment in these companies should be undertaken after considerable thought because these companies can fetch grater valuation for the Indian government,'' the report suggested.

UNI