Listed companies have been slow to introduce diversity into their boards. A survey found that 50% of Japan’s major listed companies have neither female nor non-Japanese directors. Amid the heightening demand to meet the Sustainable Development Goals (SDGs), corporations now are called to introduce diverse perspectives into their management. At the same time, companies must select people based on their expertise in corporate management and not simply meet director number quotas.
The Deloitte Tohmatsu Group and Sumitomo Mitsui Trust Bank conducted the joint survey and received responses from 970 listed companies. Forty-eight percent of companies have neither female directors nor non-Japanese directors, and 51% have no female directors. In other words, the boards of half of the companies are still comprised of only Japanese men, although the number of boards with females and non-Japanese has risen compared to the 2020 survey (902 companies). In the 2020 survey, 57% of companies had neither female nor foreign directors, and 60% had no female directors.
The Corporate Governance Code, which stipulates the management norms of listed companies, calls on companies to diversify their board of directors.
American and European companies are ahead in this regard. There are no companies on the U.S. S&P 500 Index or on the U.K. FTSE 350 Index which do not have female directors. Women account for 30% of all directors in companies listed in these indexes.
The Nasdaq will introduce rules requiring listed companies to promote racial minorities, LGBT (sexual minorities) and women to their board.