The ongoing management saga at the Tata group—Cyrus Mistry was abruptly removed as chair in October—and speculation that PepsiCo CEO Indra Nooyi is a candidate to replace him are putting a spotlight on the issue of board diversity in Asia. (PepsiCo did not immediately return my request for comment on the report.) Tata, a giant conglomerate, has never had a female chair before and there are only a handful of chairwomen of Indian companies.
India passed a law in 2013 that requires all large listed companies to have at least one female director on their boards. That rule has boosted women’s share of directorships from 4% to 14%, according to India’s National Stock Exchange. But there’s concern that some of the increase is due to families appointing female relatives to the boards of companies they control.
That phenomenon epitomizes a big criticism of quotas; that they encourage the promotion of women based on the need to fill token spots rather than merit.
To make real progress in adding women to boards, companies the world over need to address the underlying issues—discrimination, cultural stigma, access to paid maternity leave and affordable childcare—that factor into women’s absence on boards in the first place.