Optics to outcome: Corporate India needs to do more on diversity

The appointment of Priya Nair as the first woman managing director and chief executive officer (CEO) of Hindustan Unilever marks an important milestone for corporate India, which has witnessed slow progress in terms of gender diversity in leadership roles. Regulatory measures, such as the listing regulations mandating at least one woman director on the board of a listed company, have pushed companies towards greater boardroom diversity. However, progress has not been as desired. Women hold just 21 per cent of board seats, and only around 5 per cent of National Stock Exchange-listed firms have women as CEOs or managing directors. 

However, despite some progress at the top, the broader picture remains uneven. According to human resource advisory firm Marching Sheep’s “Marching Sheep Inclusion Index 2025”, released recently, 63.45 per cent of listed companies in India still lack women in key leadership roles. Such a situation prevails, though companies that perform well on inclusion have reported much higher net profits than their peers. Diversity isn’t just a moral issue, it also makes commercial sense. However, a closer look reveals that gender diversity in India Inc is imbalanced both horizontally and vertically. Horizontally, women are well represented in entry-level roles and increasingly visible at the top, but there is a significant “missing middle”, a sharp drop in representation at middle-management level, which serves as the critical pipeline to senior leadership. Vertically, women are mostly placed in functions like human resources and corporate social responsibility, which are important but rarely central to strategic business decisions. Areas like finance, operations, and core business units remain largely male-dominated, according to a 2024 McKinsey report.   

This pattern clearly limits not only women’s career growth, but also the quality of decision-making in companies. The lack of gender diversity in critical business functions can lead to narrower perspectives and missed opportunities. Women make up just 22 per cent of corporate employees in India, which is even lower than their participation in the general workforce. Thus, to fully harness India’s demographic dividend, inclusion must shift from optics to reality. Companies could embrace data-driven transparency by tracking gender-disaggregated metrics across recruitment, attrition, pay, and promotion, not just at board level but throughout all functions. Just as large companies regularly report environmental and governance indicators, diversity data can help identify gaps and drive targeted intervention. There is also a need for focused talent development through structured mentorship, sponsorship, and leadership training for high-potential women, particularly in roles like finance and operations.

  Thus, fostering supportive work environments is essential. Inclusive policies like flexible schedules, parental leave, and re-entry programmes could be seen as enablers of productivity. Regulators can play a supporting role by encouraging voluntary disclosures on gender in different roles, much like ESG (environmental, social, and governance) frameworks. Large investors are increasingly also factoring in diversity in their evaluations of corporate governance and long-term risk. Ultimately, corporate India must move from symbolic inclusion to substantive influence. This means not just counting women in leadership but enabling them with authority, resources, and decision-making powers. The goal is not just equity. It is to build resilient, innovative, and future-ready organisations, and gender-balanced leadership is central to that effort.