All companies will have to reserve at least one seat in a board of directors for women candidates if the board comprises five or more independent directors.
The government would make the presence of women directors in a board mandatory by including a provision in the proposed Companies Bill, Corporate Affairs Minister Murli Deora said today. The announcement, which coincides with the International Women’s Day, was expected to provide fair representation to women entrepreneurs, the ministry said in a statement.
“The proposed provision in the Companies Bill will give rightful due to our women in the corporate world,” Deora said. “While the United Progressive Alliance government is making all efforts to reserve one-third of the seats in Parliament or legislative assemblies for women, this step is in that direction to achieve the cherished objective of women participation in decision making and giving them a rightful place in society,” he added.
The ministry noted that more than 70 per cent of company boards in India did not have female representation. The Companies Bill of 2009 is expected to be tabled in the current session of Parliament.
According to a study by industry body Assocham, of 1,112 directorships of 100 companies listed on the Bombay Stock Exchange, only 59 positions, or 5.3 per cent, are held by women. This figure compares with 15 per cent in Canada, 14.5 per cent in the US and 12.2 per cent in Britain.