Gender Diversity in Board of Companies

Discuss about the Gender Diversity in Board of Companies.


Gender diversity at the workplace has become a widely debatable topic these days as business establishments are trying to increase the number of women employees in order to create a balance between the proportion of their male and female workers. Women have time and again proved their mettle at the corporate world and there are a lot of female CEO’s who are controlling the business operations of global corporate entities such as PepsiCo Holdings Plc., Yahoo, etc. This proves beyond doubt that women are equally capable and productive at the workplace as compared to men. Thus, gender diversity is an issue which needs to be tackled in an effective manner in order to increase the presence of female employees in the corporate sector.

The chairman of Telstra Corporation Limited has decided to address the issue of gender diversity on corporate governance on the company’s board in order to ensure the board meets the AICD target by the end of 2016. Telstra Corporation Limited is the largest telecommunications service provider in Australia and the company has prominently featured among the ASX 200 index on the Australian Stock Exchange..

The Australian Institute of Company Directors (AICD) is a not for profit membership organisation for directors of business establishments. This organisation is considered to be the founding member of the Global Network of Director Institutes (GNDI). Workplace diversity essentially refers to the vast differences which exist between the people working within an organization. The aspect of diversity encompasses gender, race, ethnic group, age, personality, sexual orientation, etc. This report mainly aims to showcase the growing importance of ensuring gender diversity at the workplace and how the business establishments could ensure better participation of women in their decision making process.

In the majority of the countries around the world, it has been found that the share of women in the board of global corporations is extremely low, however the number of women in the board of global corporations are increasing with the passage of time. This is widely attributed to the ongoing debate regarding the need to implement strict regulations to increase the participation of women in the corporate sector. Other countries such as Spain Iceland and France have also imposed gender based quotas in order to ensure a healthy proportion of women within the decision making boards of the business establishments within their respective nations (Campbell & Mínguez-Vera, 2008).

Experts are of the opinion that including more women within their boards would eventually play a vital role in enhancing the performance and organisational efficiency of the business establishments. By including more women within decision making positions, Telstra Corporation Limited would be able to increase their creativity and innovativeness in their business operations and this will go a long way in helping the organisation to increase the overall business productivity of the organisation which would lead to more profit and revenue generation. A good example in this regard would be the case of Indra Nooyi who is the CEO of PepesiCo Holdings Plc. and under whom the organisation has been able to achieve steady growth margins. She has emerged as a very capable administrator who has played a vital role in ensuring the growth and success of PepsiCO Holdings by enabling the organisation to tackle the market competition from Coca-Cola in an effective manner.

On the other hand, (Lau and Murnighan, 1998; Miller et al., 1998; Williams and Reilly, 1998) are of the opinion that including more gender diversity within the decision making board will eventually give rise to more conflict of interest and this would invariably slower down and delay the process of decision making. Thus, some school of thought indicates that including more diversity (increasing participation of women in the decision making board) will increase the cost associated with collective decision making. An example in this perspective would be that of Marissa Mayer, the CEO of Yahoo who had to step down from her position since the company was unable to perform according to their expectations of their shareholders. Yahoo under the leadership of Mayer incurred huge losses and this has really jeopardized the business operations of the organisation.

Studies have suggested that including more women within the decision making board not only helps an organisation to improve their business productivity but at the same time it also helps the business establishments to monitor their business operations and performance in an effective manner. Female directors have been found to be more ethical and responsible in their handling of the business operations and they always demand greater and improved auditing reports which help an organisation to clearly showcase their performance in front of their investors and shareholders. Thus, by including women within their decision making boards, Telstra Corporation Limited will be able to ensure a greater level of transparency in their business operations and this will help the organisation to create a positive brand reputation in the market (“Three women is not a crowd on company boards”, 2016).

Gender diverse decision making boards play a very important role in reducing the information asymmetry which exist between the shareholders and the management and thereby fosters a comprehensive and accurate information disclosure regarding the business performance of an organisation.Thus, inclusion of women within the top decision making positions helps an organisation to increase to reduce their cost of business operations by ensuring better capital budgeting of their available resources which would satisfy the needs and requirements of their business (Gul et al. 2011).

Female directors play a vital role in strengthening the independence of the decision making board and this enables the business establishment to arrive at an effective consensus which would be in the best interest of the organisation and enable the organisation to ensure their growth and success in the market (Campbell & Mínguez-Vera, 2008).

Recommendations on how Telstra Corporation Limited should initiate a gender diversity policy for the board

Telstra Corporation Limited needs to follow the following steps in order to ensure increased participation of women within their decision making board:

  • Women should always be encouraged to communicate with their peers at the workplace and provide their views and opinions which will enable their male counterparts to take notice of their contribution towards the growth and success of the business and this will enable the women employees to get recognition at the workplace (Kang et al. 2007). A notable example in this regard would be that of Primark, UK where the organisation has been able to improve their business productivity in the market by ensuring better participation of women in the decision making process.
  • A listed entity should be established in order to clearly define the respective roles and responsibilities of the board and management and at the same time also describe how their performance is going to be evaluated and monitored.
  • Telstra should strive to ensure gender equality at the workplace. The organisation should never give preferential treatment to any particular gender and the women employees should be paid on a par with their male counterparts. This would enable the organisation to create a good and positive reputation in the market which would be beneficial for their business in the near future. Moreover, women must have equal scope of career growth and enhance opportunities within the organisation and this would enable them to become more committed and responsible regarding their job roles and this would help the organisation to realise their business goals and objectives in a better manner. An example in this context is the organisation of HSBC, which was in the news recently for gender discrimination. This significantly dented the market reputation of HSBC and that forced the management of HSBC to incorporate strict regulations regarding gender equality at the workplace.


Thus gender diversity at Telstra would play a vital role in ensuring the growth and success of the organisation and this would help the organisation to further enhance their brand reputation in the market. This will help Telstra to realise their business goals and objectives in a better manner.

The Australian Shareholders’ Association (ASA) is an independent, not-for-profit and member-funded organisation which is considered to be an autonomous body that represents the investors in the Australian retail industry. ASA plays a pro-active role in helping their members to enhance their knowledge about investment with the help of its educational offerings.

The main purpose of this report is to describe the best practice contemporary standards for whistleblower policies which is going to ensure the safety and privacy of the whistle blowers and at the same time enable the business establishments to take stringent actions against incidence of wrongdoings and malpractices within their business.

The Whistleblower protection legislation is a very important piece of legislation which has been passed in Australia and it essentially looks into the implementation of ethical practices in the areas of corporate law, workplace relations law, consumer law and financial regulation. The law aims to look into the manner in which the business establishments are maintaining their integrity and valuing the contribution of their employees by incorporating better and effective practices in the managing the process of whistle-blowing. The act of whistle-blowing is essentially carried out by members of an organisation (which could include both current as well as former members). There are numerous examples of companies that have encountered the process of whistle blowing and some of them had been found to be for a good cause and some have been found to be for a bad cause. An example of whistle blowing for a good cause is that of WikiLeaks founder Julian Assange who is a notable Australian publisher, computer programmer and journalist. Julian Assange released leaked a highly confidential U.S. military manual that provided detailed information on the Guantanamo detention center and how gross incidence of human rights violations were taking place in the detention facility. An example of whistle blowing for a bad cause is that of Edward Snowden, a computer analyst working who was working with the CIA and he leaked classified information and secret NSA documents to the Guardian which lead to the revelations regarding the US surveillance on phone and internet communications.

There are various factors which can contribute towards the implementation of an effective whistleblower policy by incorporating all the best practices in the industry. These have been mentioned below:

Organisational Commitment – The organisational commitment plays a vital role in ensuring an effective whistleblower policy as it helps to boost the overall effectiveness of the legal provisions and the black letter procedures pertaining to whistleblower reporting and protection guidelines. This helps in encouraging the employees to indulge in the practice of whistle-blowing by reporting incidences of malpractices within an organisation. The primary requirement of an effective whistleblower policy is to have a clear support from the top level management which encourages the concept of reporting of wrongdoings within an organisation (Moberly, 2006). It is the responsibility and job of the senior management to commit themselves towards ensuring an effective and credible investigative process after the act of whistle-blowing has been done by an individual. Organisations need to take stringent measures and actions in cases where incidences of malpractice and wrongdoing have been verified by the investigative agencies. Research has suggested that employees who are of the opinion that their act of whistle-blowing will not be taken seriously by their employers were far less likely to report incidences of wrongdoings as compared to others whose employers encouraged them to report incidences of wrongdoings (Aubert et al. 2006).

Encouragement of Reporting – This is the main objective of any whistle-blowing program. The success of any whistle-blowing programs essentially depends on the amount of encouragement provided to the employees to report the occurrence of malpractices. At present we are witnessing a considerable amount of reporting by employees of public sector enterprises however there is also an increasing reticence among the employees to report incidences of wrongdoings and this is usually attributed to the deficiencies which exist in the formal systems such as their complexity and lack of clarity regarding the statutory whistle-blowing legislation.. Organisation must have multiple reporting pathways which will help in bringing forward the incidence of malpractices either to their line managers or to the alternative reporting points which exist within the organisation or external agencies such as Ombudsman’s Offices and anticorruption bodies (Vadera et al. 2009).

Assessment and Investigation of Reports – An effective investigation process is a very important determinant of the overall effectiveness of the whistle-blowing program which is being practiced by an organisation. The responses to reports invariably depend on an effective assessment regarding the element of disclosure and this plays a vital role in ensuring that the disclosures are handled in an effective manner. However, it is extremely essential for the business establishments to have an effective policy in place which clearly demarcates the power and authority of the managers regarding which matters should be handled by them and which should be handled by the internal or external organisation mechanisms. Another important aspect is to ensure the safety of the whistle blower and keep his/her identity secret and this should be done right at the point of disclosure of wrongdoings (Singh, 2011).

Internal Witness support and Protection – This is arguably the most important objective of any whistleblower program. The provision for organisational support to the whistleblowers is currently considered to be the single weakest link which undermines the overall effectiveness of the whistleblower program thereby compromising the responses from the business establishments. Business establishments need to develop witness protection programs which will supplement the organisational needs and requirements and this would help in ensuring that internal and external support are provided and directly delivered whenever necessary by individuals who are working in an institutional role within the organisation and this would eliminate the possibility of conflict which would challenge the provision of support (Apaza & Chang, 2011).

An integrated organisational approach – An integrated organisational approach is absolutely imperative in order to ensure an effective whistle-blowing program. It would help a business establishment to maintain their commitment towards ensuring the protection of the whistle-blowers and thus it would encourage more employees to come forward and report the incidences of wrongdoings and malpractices which have been done within an organisation by some corrupt individuals (Singh, 2011). There needs to be an effective communication (both external and internal) which will enable to take appropriate measures for ensuring the safety of the whistleblower and ensure stringent action against incidence of wrongdoings within an organisation.

Recommendations for developing an effective whistle-blowing program

  • Organisational commitment is extremely important in order to have an effective whistle-blowing program. There should be total commitment from the top level management towards the program and the management must incorporate a clear and comprehensive whistle-blowing policy which should be understandable by everyone (Aubert et al. 2006).
  • Organisations need to encourage reporting incidences of malpractices and they must provide a comprehensive coverage to their employees. The organisation must have a clear definition regarding what constitutes a wrongdoing and they must have multiple reporting pathways to report incidences of wrongdoings.
  • The organisation needs to maintain the confidentiality of the whistleblowers and must ensure their safety within the organisation.
  • Organisation needs to have an effective internal witness support and protection mechanism within their business domain (Moberly, 2006).


Thus we can see from the above discussion that having an effective whistle-blowing program is extremely important from the context of a business establishment as it would enable them to undertake their business operations in a socially responsible and ethical manner.


Three women is not a crowd on company boards. (2016). Financial Review. Retrieved 5 September 2016, from

Aubert, C., Rey, P., & Kovacic, W. E. (2006). The impact of leniency and whistle-blowing programs on cartels. International Journal of Industrial Organization, 24(6), 1241-1266.

Vadera, A. K., Aguilera, R. V., & Caza, B. B. (2009). Making sense of whistle-blowing’s antecedents: Learning from research on identity and ethics programs. Business Ethics Quarterly, 19(04), 553-586.

Moberly, R. (2006). Sarbanes-Oxley’s structural model to encourage corporate whistleblowers. Brigham Young University Law Review, 1107.

(2016). Retrieved 5 September 2016, from

(2016). Retrieved 5 September 2016, from

Apaza, C. R., & Chang, Y. (2011). What makes whistleblowing effective: Whistleblowing in Peru and South Korea. Public Integrity, 13(2), 113-130.

Singh, J. B. (2011). Determinants of the effectiveness of corporate codes of ethics: An empirical study. Journal of Business Ethics, 101(3), 385-395.

Bear, S., Rahman, N., & Post, C. (2010). The impact of board diversity and gender composition on corporate social responsibility and firm reputation.Journal of Business Ethics, 97(2), 207-221.

Kang, H., Cheng, M., & Gray, S. J. (2007). Corporate governance and board composition: Diversity and independence of Australian boards. Corporate Governance: An International Review, 15(2), 194-207.

Campbell, K., & Mínguez-Vera, A. (2008). Gender diversity in the boardroom and firm financial performance. Journal of business ethics, 83(3), 435-451.

Gul, F. A., Srinidhi, B., & Ng, A. C. (2011). Does board gender diversity improve the informativeness of stock prices?. Journal of Accounting and Economics, 51(3), 314-338.

Marimuthu, M., & Kolandaisamy, I. (2009). Ethnic and gender diversity in boards of directors and their relevance to financial performance of Malaysian companies. Journal of Sustainable Development, 2(3), 139.

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