We are especially concerned with ensuring effective independent board leadership, which involves achieving the right skill sets as well as a diversity of views, including gender diversity, on boards. Our Fearless Girl campaign has inspired companies and shareholders worldwide to focus on board diversity and join us in our call to action, with close to 900 companies identified by State Street Global Advisors responding to our call by adding a female director.
Research shows that closing the gender gap in the workforce in the Middle East and North Africa, including the Gulf Cooperation Council (GCC) countries, could add US$2.7 trillion to the region’s economy by 2025.1
State Street Global Advisors examined 172 blue chip companies across the GCC region and found that one-third of them have at least one female board member, which represents a 130-percent increase over the last three years. The United Arab Emirates, Bahrain and Saudi Arabia have made greatest progress in terms of board gender diversity.
Beginning in March 2022, we expect boards of companies in all markets and indices to have at least one female director and will take voting action in the case of non-compliance.
We believe directors have an important role to play in increasing gender diversity on their boards and throughout their organizations, and have included guidance to help facilitate these efforts in the GCC countries.
At State Street Global Advisors, we view gender diversity as one of many ways a board can introduce a varied set of skills and expertise among its directors to help improve financial performance.
Gender diversity on boards has been a thematic engagement area for State Street Global Advisors since 2015. Leveraging these engagements we launched our Fearless Girl campaign in March 2017, which has contributed to the increased representation of women on boards in the major indices in the US, the UK, Europe, Canada, Australia, Japan, Hong Kong and Singapore, with close to 900 companies identified by State Street Global Advisors responding to our call by adding a female director.
Beginning in 2022, we expect boards of companies in all markets and indices to have at least one female board member. In the case of non-compliance or lack of a specific, timebound plan to add a female director to the board, we will vote against the Chair of the Nominating Committee. Should a company fail to add a female director to its board for three consecutive years, we will vote against the entire Nominating Committee.
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