State Street targets STI firms for lacking women

State Street Global Advisors, one of the world’s largest asset management firms, has taken aim at six Singapore-listed blue chip companies for not having any women on their board of directors. In a conference call on Friday, SSGA said that moving forward, it planned to start voting against the people most directly responsible for nominating board members, which could potentially mean those people are in danger of being kicked off the board.

While the firm did not specifically identify the six, it said that it is targeting companies on the Straits Times Index, and Singapore newspapers have reported that some STI companies lacking female directors include Dairy Farm, Jardine Matheson Holdings, Jardine Strategic Holdings, UOL Group and Yangzijiang Shipbuilding.

SSGA has been pushing for greater gender diversity on the boards of the companies in its portfolio since 2017. In that year, it began demanding that companies should have at least one woman director on their boards, and must engage in a dialogue on gender diversity at least once every three years. It rolled out the initiative in the form of guidelines for voting against nomination committees that fail the requirement, and is extending the guidelines to Singapore this year. It is also extending the guidelines to Hong Kong, where it is targeting 11 companies on the Hang Seng Index.

Benjamin Colton, SSGA’s global co-head of asset stewardship, said that gender diversity in these two countries is quite advanced, and the companies which are failing to place female directors on their board are “really laggards and outliers." 

In its guidelines, the firm pointedly states that the most commonly used excuse for a lack of female directors, a purported lack of qualified candidates, is not in fact the real reason. It says: “We have found that current practices for nominating directors as well as behavioral biases that continue to undervalue the contributions of women in the workplace are the leading obstacles,” and goes on to list factors such as excessive reliance on old boys’ networks to identify candidates, failure to address gender bias in workplace culture and HR practices, and even lack of work-life support that has stunted the pipeline of female candidates.