BUSINESS LEADERSHIP: THE CATALYST FOR ACCELERATING CHANGE Follow us on twitter @30pctAustralia OUR OBJECTIVE is to achieve 30% of ASX 200 seats held by women by end 2018. Gender balance on boards does achieve better outcomes. GREATER DIVERSITY ON BOARDS IS VITAL TO THE GOOD GOVERNANCE OF AUSTRALIAN BUSINESSES. FROM THE PERSPECTIVE OF PERFORMANCE AS WELL AS EQUITY THE CASE IS CLEAR. AUSTRALIA HAS MORE THAN ENOUGH CAPABLE WOMEN TO EXCEED THE 30% TARGET. IF YOUR BOARD IS NOT INVESTING IN THE CAPABILITY THAT DIVERSITY BRINGS, IT’S NOW A MARKED DEPARTURE FROM THE WHAT THE INVESTOR AND BROADER COMMUNITY EXPECT. Angus Armour FAICD, Managing Director & Chief Executive Officer, Australian Institute of Company Directors BY BRINGING TOGETHER INFLUENTIAL COMPANY CHAIRS, DIRECTORS, INVESTORS, HEAD HUNTERS AND CEOs, WE WANT TO DRIVE A BUSINESS-LED APPROACH TO INCREASING GENDER BALANCE THAT CHANGES THE WAY “COMPANIES APPROACH DIVERSITY ISSUES. Patricia Cross, Australian Chair 30% Club WHO WE ARE LEADERS LEADING BY EXAMPLE We are a group of chairs, directors and business leaders taking action to increase gender diversity on Australian boards. The Australian chapter launched in May 2015 with a goal of achieving 30% women on ASX 200 boards by the end of 2018. AUSTRALIAN 30% CLUB MEMBERS Andrew Forrest Fortescue Metals Douglas McTaggart Spark Group Ltd Infrastructure Trust Samuel Weiss Altium Ltd Kenneth MacKenzie BHP Billiton Ltd John Mulcahy Mirvac Ltd Stephen Johns Brambles Ltd Mark Johnson G8 Education Ltd John Shine CSL Ltd Paul Brasher Incitec Pivot Ltd Peter Warne Macquarie Group Ltd Tracey Horton AO Navitas Ltd Kenneth Henry AC National Australia Rebecca McGrath OZ Minerals Ltd Bank Ltd Catherine Brenner Past Chair of AMP Ltd Neil Chatfield Costa Group Holdings Ltd and SEEK Ltd Simon Jones Computershare Ltd Jeremy Sutcliffe CSR Ltd John Mullen Telstra Corporation Ltd Robert Ferguson GPT Group David Kirk Trade Me Group Ltd Richard Fisher AM InvoCare Ltd Ilana Atlas Coca-Cola Amatil Ltd Justin Milne MYOB Group Ltd Wallace Sheppard Dexus Property QANTAS Group Richard Clifford Airways Ltd Brian Schwartz Scentre Group Ltd Michael Chaney Woodside Thomas Pockett Stockland Petroleum Ltd and Westfarmers Ltd Corporation Ltd Graeme Liebelt Amcor Ltd Zygmunt Switkowski Suncorp Group Ltd Geoffrey Tomlinson Growthpoint John Thame Abacus Property Group Properties Australia Ltd Glenn Barnes Ansell Limited Peter Hay Newcrest Mining Ltd and David Gonski AC ANZ Banking Vicinity Centres RE Ltd Group Ltd Richard Lee AM Oil Search Ltd Robert Johanson Bendigo and Gordon Cairns Origin Energy Ltd Adelaide Bank Ltd and Woolworths Group Ltd David Clarke Charter Hall Group Philip Clark Shopping Centres Catherine Livingstone Australasia Property Group Commonwealth Bank of Australia John O'Neill The Star Entertainment Ian MacDonald Genworth Mortgage Group Insurance Australia Ltd Lindsay Maxsted Westpac Banking Stuart James Greencross Ltd Corporation and Transurban Ltd Gregory Martin Iluka Resources Ltd Leslie Hosking Adelaide Brighton Ltd Peter Bush Mantra Group Ltd, Pacific Roderic Holliday-Smith Cochlear Ltd Brands Litd & Southern Cross Media and ASX Ltd Group Ltd Graham Bradley GrainCorp Ltd Christopher Roberts Orora Ltd Paula Dwyer Tabcorp Holdings Ltd Geoffrey Brunsdon Sims Metal and Healthscope Ltd Management Ltd John Cowin Domino's Pizza David Crawford AO South32 Ltd and Enterprises Ltd Lend Lease Ralph Norris Fletcher Building Ltd Raphael Geminder Pact Group Douglas Halley Past Chair of Duet Holdings (Australia) Pty Ltd Harvey Collins Past Chair of Derek La Ferla Sandfire Resources NL Navitas Ltd Trevor Gerber Sydney Airport Ltd David Haslingden Past Chair of Nine Allan McCallum Tassal Group Ltd Entertainment Co. Holdings Ltd Robert Ferguson Primary Health Donald Taylor Past Chair of Care Ltd GrainCorp Ltd Glenn Davis Beach Energy Ltd Roger Sexton Past Chair of IOOF John Prescott AC Past Chair of Holdings Ltd Aurizon Holdings Ltd Peter Scott Past Chair Perpetual Ltd Craig Farrow Past Chair of M2 Jerry Maycockm AGL Energy Limited Group Ltd and Arrium Ltd Neil Hamilton Past Chair of OZ Kate Spargo UGL Group Minerals Ltd David Blight Chair of the Helen Nugent AO Past Chair of Veda Remuneration and Nomination Group Ltd Committee Japara Healthcare Ltd David Turner Past Chair of Jim McKerlie Drillsearch Energy Ltd Commonwealth Bank of Australia Robert Wright Super Retail Group Ltd Kevin McCann AM Past Chair of Macquarie Group Ltd Robert Mactier STW Communications Jac Nasser AO Past Chair of BHP Bruce Brook Programmed Billiton Ltd Maintenance Services Ltd Simon McKeon AO Past Chair of Peter Robinson Australian AMP Ltd Pharmaceuticals Industries (api) Ltd Diane Smith-Gander Past Chair of Louis Carroll Cover-More Group Ltd Broadspectrum Ltd David Gordon Accent Group Ltd and Margaret Jackson AC Past Chair of Past Chair of Ten Network Holdings Ltd Spotless Group Holdings Ltd Greig Gailey Caltex Australia Ltd Graham Kraehe AO Past Chair of Bluescope Steel Ltd Mike Hutchinson Infigen Energy Ltd Graeme Hunt AGL Bob Every AO Past Chair of Boral Ltd & Wesfarmers Ltd George Venardos IOOF OUR APPROACH THE BUSINESS CASE FOR DIVERSITY ON BOARDS IS CLEAR The business case is clear – a higher standard of corporate governance, improved financial performance and an enhanced capacity to attract and retain female talent. Diverse teams make better decisions: McKinsey & Company research of 180 publically traded companies found ROEs were 53% higher for companies ranking in the top quartile of executive board diversity than those in the bottom quartile. In Australia, the Reiby Institute found ASX 500 companies with women on their boards deliver a significantly higher ROE than those with no women on their board. One woman is not enough: 30% is the proportion when the contributions of a member of a minority group are valued in their own right. Research has shown that a critical mass of three or more women can cause a fundamental change in the boardroom and enhance corporate governance. GETTING TO 30% AN ACHIEVABLE GOAL Achieving 30% female directors on ASX 200 boards is within sight. Women currently comprise 26.7% of ASX 200 board seats. In order to achieve the target by the end of 2018, we need a monthly year-to-date new appointment rate of over 50%. Meeting this target will require demand by investors, leadership from board chairs, commitment by nominations committees and action from head hunters. It will also require an ongoing investment from CEOs and leadership teams in developing the pipeline of female directors. Percentage of female directorships on ASX 200 boards 30% 26.2% 26.2% 26.7% 25.3% 25% 21.7% 20% 15% 10% 5% 0% 2015 2016 2017 Jan - 18 Feb - 18 INVESTOR TOOLKIT INVESTOR FOR ENGAGING GROUP BOARDS ON DIVERSITY Statement of Intent DISCLOSURE EXPECTATIONS As part of our overall stewardship responsibilities on behalf of our members and clients, we will actively engage with investee companies on corporate governance issues including the process the board uses to identify suitable As asset owners and asset candidates for the board. The 30% Club believes that THE BOARD’S ROLE IN DIVERSITY managers we are responsible gender balance on boards not To provide investors with a comprehensive understanding of an investee for the stewardship of the only promotes better leadership Companies that value diversity of thought, and the investments we make on company’s diversity policies, we expect companies to be transparent and governance, but further associated benefits of an engaged, thriving, innovative regarding the procedures used to find new members for the board and how and productive workforce, are committed to fostering behalf of our members contributes to better all-round that process ensures a diverse board. an environment that enables that diversity to permeate and clients. Part of that board performance, and ultimately and define the culture. This commitment begins at the responsibility includes the As well as disclosures required under Corporate Governance Codes, increased corporate performance. board level – setting the tone from the top – and extends assessment of the boards we also expect to see evidence of a culture of commitment to diversity at throughout all levels of the organisation. of our investee companies. the board level. Further details of the types of enquiries we will make and A board that embraces its role in governing diversity We believe boards that disclosures we will seek are outlined in our Investor toolkit for engaging PURPOSE and culture throughout the company is more likely to genuinely embrace cognitive boards on diversity. accelerate progress and reap the benefits a diverse diversity, as manifested This toolkit has been developed by the 30% Club workplace can bring. through appropriate gender ENGAGEMENT to help investors, and those representing them, We believe diversity is first driven by a well-considered representation and a broad more effectively engage with boards of directors and disclosed strategy that articulates why this issue We will actively engage with board chairs and nomination committees on the spectrum of skills and on this important issue. matters to a company and how it is implemented by issue of board diversity to convey the high level of importance that we, and experience, are more likely to management and monitored by the board. achieve better outcomes for our clients and members, place on this issue. investors. There is increasing We will raise questions where there is evidence that there has been a research to support this failure