Only a quarter of board seats at newly public TSX-listed companies are occupied by women in 2021, according to data from Women Get On Board and irlabs.
From January 1, 2021, to August 15, 2021, there were 61 new listings on the TSX with a total of 318 board seats. The data shows that out of those 318 seats, only 25 percent (79 seats) were held by women.
The number of women directors serving on the boards of these 61 companies ranged from zero to three women. The average percentage of women serving on the board stands at just 19 percent.
Only three companies out of the 61 have a female chair and only one has a female vice chair.
Out of the 61 newly listed companies, Greenlane Renewables had the highest proportion of female board representation: its three female board directors represent 43 percent of the overall board.
Stricter requirements for board gender diversity coming in 2022
Since December 2014, TSX-listed companies in Canada have been required to disclose their approach to gender diversity.
But Canadian public companies will see stricter proxy voting guidelines on board gender diversity requirements come into play for the 2022 proxy season.
Institutional Shareholder Services (ISS) has announced that it expects S&P and TSX-listed companies to have at least 30 percent female board representation, effective February 1, 2022.
If a company can’t reach this percentage, then it will need to have a written gender diversity policy. This policy will need to show a commitment from the company to achieve at least 30 percent female board representation over a reasonable timeframe.
If a company has no female board directors and no formal written gender diversity policy, ISS will vote to withhold approving the chair of the nominating committee, including for widely held companies that are not on the index.
Additionally, from January 1, 2022, Glass Lewis will also require all TSX-listed issuers to have at least two female directors. For boards with six or fewer total directors, issuers are expected to have at least one female director.
At companies that fail to meet these requirements, Glass Lewis will recommend voting against the chair of the nominating committee.
Glass Lewis also says it will carefully review a company’s disclosure regarding diversity, including its targets and timelines for increasing female representation. Glass Lewis says it may refrain from making a negative recommendation if the company provides sufficient rationale or a plan to address the lack of board diversity.