Gender diversity on corporate boards can improve climate governance and innovation actions.
Gender diversity: crucial for innovation and climate governance?
According to a new report by BloombergNEF, a proportion of 30% more women in decision-making positions in global electric, oil & gas, and mining utilities has shown a positive correlation with better climate governance and innovation in the last four years.
The Gender Diversity and Climate Innovation Report, written in collaboration with the Sasawaka Peace Foundation (SPF), shows that gender does not directly contribute to lowering emissions.
However, oil companies with higher female representation in their corporate boards have been more likely to set decarbonization strategies and invest in digitalization efforts.
Through more female participation, companies can enhance climate governance, climate performance, innovation, and finally achieve a climate innovation environment.
In this regard, Miho Kurosaki, research head for BloombergNEF in Japan and Korea, told Bloomberg gender diversity disclosures would increasingly acquire more relevance. Furthermore, companies can better assess the correlation between diversity and business performance through these reports.
Disclosure and reporting
Kurosaki added utilities should consider establishing long-term diversity goals, as they also set financial performance goals. According to the researcher, financial markets will surely start to evaluate those commitments in the future.
The study finds that 30% of more women representation on boards makes a difference. In this regard, it is crucial to keep those numbers up since one-third representation of women makes up only 16% globally out of the almost 12,000 companies analyzed in the report.
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Over the last ten years, the share of female representation in corporate boards grew globally from 2% to 16%. According to the report, gender diversity will continue to be critical both at the overall work and the decision-making level.
European countries have been the most active in gender diversity reporting. Since 2011, the European Union has called on voluntary initiatives and female representation’s mandatory introduction on various government levels.
The report was disclosed at the BNET Summit Shanghai, where participants also highlighted Asian nations are committing to diversity disclosure and performance.