In this decade, we have seen an increase in women's participation in the board of director. Previously, we can see around the world, every board of director of a single company led by men only. But, over the time, women are slowly absorbed into the board of director and they play a great role as well as a good impact in the improvement of the company. A new study suggested that, putting women on boards of directors is a good way to make companies more profitable and better governed. It is because a woman is more likely to take a collaborative approach to decision-making and reach a broader consensus with buy in from all players.
Men, on the other hand, are more likely to use rules, regulations and traditional ways of doing business or getting along. “It’s the ‘Mom effect.’ Men are less prone to lose their temper or be alpha males when a lady joins the board,” say McMaster business school Professor Chris Bart. And having one or more women on a board translates into higher sales, better returns for shareholders and fewer corporate bankruptcies.
Most countries put the quota at least at a certain minimum level of participation of women in the board of directors. There are also countries that do not put a quota of men and women's involvement in the board of directors. Countries like the United States and Singapore do not put any gender quota for women on boards or in senior management positions. On the other hand, countries like Malaysia put a minimum quota for representation of women on boards. Prime Minister Datuk Seri Najib Tun Razak announced that the Malaysian Cabinet approved legislation where corporate companies must achieve at least 30 percent representation of women in decision-making positions in the private sector, to promote gender equality. Some countries like Norway have even introduced formal laws requiring female representation on corporate boards.
Board of Directors
In every organization, board of directors plays a significant roles and responsibilities to ensure the company is achieving their strategy and goals. Directors' duty in any tasks is very critical such as solve the problem, make a decision, plan a strategy and potential project. Their contribution to the company can help he company to achieve the highest value in any aspects. Therefore, this part will briefly explain about director and board structure, role and responsibility of directors, and the legal requirement in company’s board’s directory (Amendment Act 2007). 2.1
Director and Board Structure
The board of directors leads and controls a company and hence an effective board is fundamental to the success of the company. The board is the link between managers and investors, and is essential to good corporate governance and investor relations. The duty of the board is responsible to determine the company’s aims and the strategies, plans, and policies to achieve those aims. The high performance board must achieve three core objectives. The core objectives are providing superior strategic guidance to ensure the company’s growth and prosperity, ensure accountability of the company to its stakeholder, including shareholders, employees, customers, suppliers, regulators and the community, then, ensure that highly qualified executive team is managing the company. Actually, for more understanding about the women and board of directors, we would like to explain the definition of board of directors. According to financial dictionary, board of directors means:- “A board of directors is a team of people elected by a corporation's shareholders to represent the shareholders' interests and ensure that the company's management acts on their behalf. The head of the board of directors is the chairman or chairperson of the board” So, a woman on the board of directors is involving the women in managing the company through the position on board. The situation that women occupied the board also known as gender diversity on the board. The...
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