Sunday, January 29, 2023 | Rajab 6, 1444 H
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EDITOR IN CHIEF- ABDULLAH BIN SALIM AL SHUEILI

Stock exchanges report 21 per cent women on boards

Gender equality among board roles at the stock exchange firms that underpin financial markets remains poor, despite the industry’s commitment to ESG (Environmental, Social, Governance) goals, which require fair gender representation on boards.


In a survey conducted by the World Federation of Exchanges (WFE), 42 out of 49 exchanges said they had made a formal commitment to sustainability. However, only 37 per cent of exchanges said they have targets for female representation.


Overall, exchanges remain male-dominated, especially in more senior roles. While the percentage of women working at exchanges sat at around 42 per cent, only 32 per cent of senior management were female. This figure shrank to 21 per cent at board level.


Globally, there is a demand for all things ESG: 93 per cent of exchanges said there is at least some demand for ESG products, though 53 per cent said it was rather limited. Of the 49 respondents, 37 said they offer sustainability-linked products. The products most commonly offered were green bonds, social bonds and sustainability-based indices.


The top reason exchanges gave for their ESG engagement was sustainability concerns (88 per cent). Tied for second at 83 per cent was a desire to demonstrate leadership and expanded business opportunities. Overall, the survey found exchanges were moving in a more positive direction on inclusion of ESG in their markets and their own operations.


However, exchanges were not all at the leading edge. Only 33 per cent of publicly traded exchanges were included in at least one sustainability ESG index, although this is an improvement from 29 per cent in 2021; 19pc said they were working towards inclusion. It was a similar situation with ESG disclosures – 96 per cent said there is at least some demand for data but 56 per cent of exchanges said it was limited.


When it came to incorporating the UN’s Sustainability Development Goals (SDG) into their own sustainability reporting, 63 per cent of exchanges said they had done so but only 39 per cent provide education for listed companies to follow suit. Even fewer – a third – said they made a formal commitment to SDGs.


Exchanges overwhelmingly supported the creation of the International Sustainability Standards Board, a standards-setting body that would produce a baseline disclosure framework for sustainability. But at the same time, six out of 10 said there was no requirement now or in the foreseeable future where ESG data would need to be verifiable.


Chief executive of the WFE, Nandini Sukumar, said he was pleased with the results, noting they were steps in the right direction. He said: “Our new survey results highlight the vital role that the exchange industry plays in the shift towards a sustainability and inclusive global economy.”


He added: “It is encouraging for us, as an industry that has championed ESG in financial markets for more than a decade, to see a positive trend towards carbon neutrality accompanied by genuine interest and engagement in these issues from stakeholders.”


Apart from stock exchanges, major companies are increasingly focusing on gender equality. Among the recent firms to do so as a priority is Fidelity International which provides worldwide investment management services. The company pledged to bolster the number of women in senior roles across its business over the next two years – part of wide-ranging corporate sustainability plans that also bring forward its net zero goal by a decade.


The $787bn asset manager has set a target to have 45 per cent of boardroom positions held by women by 2024.


Fidelity also aims to have 35 per cent of global senior management roles held by women in two years’ time, which would mark an increase of three percentage points on last year’s figure. In addition, it wants women to make up 45 per cent of its global workforce by 2024 – a rise of two percentage points on current figures.


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