Golden skirts and lone woman directors: Why a majority of Indian firms have exactly one woman director on their board

In the nearly 10 years since markets regulator the Securities and Exchange Board of India (Sebi) made it compulsory for listed companies—subject to certain criteria—to have at least one woman director on their board, the needle is surely and steadily moving. An EY report from October 2022 shows that women’s representation on Indian corporate boards has tripled from 6 per cent in 2013 to 18 per cent in 2022. As per primeinfobase’s analysis of Nifty 500 companies, the absolute number of women directors in India has more than doubled since 2015, after the Sebi guidelines became effective. But a closer look reveals that the country is still some distance away from going beyond checking the boxes.

For starters, several boards have a lone woman director because of companies sticking to the bare minimum mandated by law. EY data shows that about 60 per cent of the Nifty 500 companies have just one woman board member, while less than 5 per cent of the companies have women as chairpersons. Only nine of the Nifty 500 companies have 50 per cent women’s representation, as per primeinfobase.  

Vinita Bali, former MD & CEO of Britannia Industries, who has worked extensively with listed companies in India and overseas in executive and independent director positions, says she initially found herself to be the lone woman independent director in boardrooms. “But that has changed. I guess it is also partly a reflection of the boards I have been on in India such as Titan, CRISIL, Syngene—all companies that believe in diversity beyond gender.”

The situation in India, despite its ‘golden skirts’—a term coined to refer to the same small set of distinguished women who get circulated across multiple board positions—is not as bad as it is in Norway, where women are known to hold 25-35 directorships each. And one needs to thank the Companies Act, 2013, for this, as the law caps the maximum number of directorships any person can hold at a given time at 10 in listed companies and 20 if it is expanded to all companies. But it is still quite concentrated in India where 605 women hold the 803 board positions in Nifty 500 firms, per the 2022 EY report. Incidentally, the Companies Act made it mandatory for certain firms to have at least one woman on their boards.      

Pallavi Shroff, Managing Partner of legal firm Shardul Amarchand Mangaldas, agrees that this indeed is the case. With five directorships, she is among the women directors with the maximum number of board representations in Nifty 500 companies. “It is not correct. Companies need to realise that younger women have a lot to offer as directors,” she says, adding that the onus is also on senior women board members to encourage boards to appoint newcomers. Radhika Gupta, MD & CEO of Edelweiss Asset Management, says it is perhaps easy to default to a few tried and tested names. “We would probably do a better job at widening the net (of women in the workforce) rather than just the boards because finally boards play an advisory and oversight role,” says Gupta.

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