The share of women on boards of 140 Polish listed companies from the WIG20, mWIG40 and sWIG80 indices was a mere 13.8% at the end of 2019. Additionally, progress to rectify this imbalance has been slow, with an increase of only 3.8pp observed over the last decade. Firms with a higher representation of women on boards saw competitive advantages in terms of higher net margins and lower share price volatility. This data was drawn from “Women on boards and company performance”, a report published by CFA Society Poland. The largest companies from the WIG20 index were the most diversified in terms of gender, conversely the smallest companies from the sWIG80 index were the least diversified.

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“Non-financial criteria, including diversity on boards, are increasingly important for investors. The participation of women on the management boards and supervisory boards of listed companies is not only a matter of corporate governance, but also a business matter. With growing popularity of including these criteria in investment decision making, board diversity should be a commonly used factor in portfolio selection in Poland in 2021” – Milena Olszewska-Miszuris, CFA, Vice President of CFA Society Poland, responsible for the ESG area, co-author of the report.

Women participation higher on supervisory boards than on management boards

The research conducted on the 140 largest Polish listed companies included in the WIG20, mWIG40 and sWIG80 indices at the end of 2019 showed that, in the years 2010-2019, women were a minority on the boards of these companies. Men did not constitute a minority at any point in any of the surveyed years. There were on average eleven people on the management and supervisory boards combined at the end of 2019 and female participants accounted for only one to two of those seats. Women were also more likely to be found among representatives of supervisory boards rather than among management board members.

WIG20 as the most diverse index in terms of gender participation

The WIG20 companies had the most diversified boards in terms of gender. This could be partly due to the fact that the boards of the largest companies were more numerous (on average 14.7 people at the end of 2019) than for medium and small companies (11.7 and 9.1 respectively). Over the past decade, the largest companies from the Warsaw Stock Exchange (WIG20) recorded the most dynamic increase in gender diversity in the board structures of the analysed indices, almost doubling the share of women on boards from 9.7% to 18.1%. In the case of companies from the mWIG40, the share of women on boards increased by 3.1 pp. (to 14.3%), and for companies included in the sWIG80 by 2.5 pp. (to 11.7%).

“The situation has improved in recent years, but a lot remains to be done. In 2019, every fourth of the surveyed companies did not have a woman on either board. In as many as nine out of every ten studied firms, the share of women did not exceed the threshold of 30%, described in many sociological and politics studies as being the required threshold to give a minority a tangible influence on the decision-making process. In no company was the number of women and men on the board equal” – Aleksandra Włodarczyk, CFA, trader at Société Générale, co-author of the report.

Energy and finance as leaders of diversity on boards

It may seem surprising that in 2019 one of the sectors exhibiting some of the lowest representation of women on boards (only 9.6%) was the retail sector, despite the fact that women predominate in the employment structure of the entire industry. The most diverse in terms of gender were the boards of companies in the finance (20.2%) and energy (18.7%) sectors. The highest increase in the presence of women on management and supervisory boards was observed in the real estate sector, where the share of women doubled from 7% to 14% over the decade.

“Our research results contradict the popular perception of certain industries or qualifications as being inherently ‘feminine’. Low representation of women on boards of retail companies, normally considered as being more feminised, or the relatively highest representation of women in the theoretically “male” energy sector, may be a reason for abandoning the paradigm of dividing professions by gender. Talent knows no gender and diversity brings tangible benefits to companies” – Iweta Opolska, PhD, CFA, Director of the Gas Trading Office at PKN Orlen, co-author of the report.

The authors of the report also compared a number of financial ratios between companies with an extremely low female representation on boards against those with relatively higher share of women on boards. The ratios related to dividend payment, profitability, dynamics of revenues and profits as well as valuation and risk were compared. Two of the examined indicators showed statistically significant differences. The companies with more women in the analysed period were characterized by a higher net profit margin and lower volatility of share prices than the group of companies with the lowest share of women on boards.

“We would like our report to draw attention and increase awareness to the issue of gender diversity on boards. It is worthwhile to recruit candidates for the highest positions from the entire pool of talent, not just from those in the ‘front line’. There are many highly talented women on our capital markets whose knowledge and skills can create value for enterprises” – Anna Golec, PhD, CFA, researcher at the Management Faculty of the University of Gdańsk and University West in Sweden, co-author of the report.

This report is just the beginning – more research on this topic is essential. Agreement with this sentiment was expressed by Professor Krzysztof Jajuga, President of CFA Society Poland: “It is impossible to cover such a broad topic in one report. The study identifies some properties, and it can be a base for a future discussion and an inspiration for further research e.g., about the causes and directions of mutual dependencies. Such initiatives will be supported by CFA Society Poland”.

The issue of women’s participation on company boards in Poland requires the attention of all stakeholders and needs additional actions to mobilize the push for change. This thought is shared by Olga Siedlanowska-Chałuda, Head of Program Section, UN Global Compact Poland, partner of the report: “While the results of this report clearly show that there is still much to do, it is even more important to carry out more research, raise this topic and provide the arguments for a change. I hope that through joint action we will get to a situation where gender equality will be a fact, and arguments will not be needed at all.”

The partners of the report are UN Global Compact Poland, CMS Law Firm in Poland, Société Générale Branch in Poland, 30% Club and M+G.

A number of specialists from the financial market worked on the report, gathered in the Diversity Committee established within CFA Society Poland.


Cover picture: cfapoland