The Emerging Trend of Women in Leadership and Economic Prosperity

According to a study by S&P Global, the proportion of women leading listed companies in the US has increased from 16.6% in 2015 to 21.2% in 2023. This proportion is continuing to increase, and expected to reach 25% by 2025.

In Vietnam, according to a report by the Vietnam Women’s Business Council (VWBC), the proportion of women business leaders accounts for 23%, of which the proportion of women who are CEOs is 7%.

Achieving gender balance on Boards is an important step towards a more equitable and diverse business environment. Although regulatory mandates vary around the world, the pursuit of this goal is growing strongly. Let’s dive into the current situation with safety and inclusivity in mind:

Globally, there is no one-size-fits-all approach. There is no global law regulating the specific ratio of female representation on Boards of Directors. Different countries have adopted diverse approaches, reflecting cultural contexts and economic priorities.

• Mandatory regulations: Some countries, such as Norway and France, have made mandatory regulations for female representation on Boards of Directors. This tactic significantly increased the proportion of women on boards, demonstrating its effectiveness in driving rapid change.
• Voluntary targets and initiatives: Other countries have chosen voluntary targets or soft quotas, which encourage companies to increase female representation on boards without the need for enforcement. Examples include the UK’s Davies Report and Japan’s 30% target by 2020.

Currently, Vietnam does not have a specific law regulating female representation on the Board of Directors. However, Vietnam has taken encouraging steps towards gender equality in corporate governance.

• National Action Plan on Gender Equality: This plan was approved in 2016, emphasizing the importance of women’s leadership in many fields, including the business sector. It encourages companies to promote female talent and consider gender diversity when selecting board members.
• Corporate Governance Code: The revised Corporate Governance Code 2020 recommends that companies consider diversity, including gender, when constituting their boards. This recommendation, while not legally binding, creates a positive spirit and encourages voluntary efforts toward greater representation.

Statistical table of Women CEO rates of some ASEAN and European countries

Besides, there is still a gender wage gap, a problem that exists in all countries, regions, and industries. This difference represents income inequality between men and women, which is one of the manifestations of gender inequality.

According to a report by the International Labor Organization (ILO), the average gender wage gap in the regions is as follows:

• Asia: 13.6%
• Europe: 12.7%
• Americas: 11.3%
• Africa: 16.2%
• Oceania: 10.6%

Thus, the gender wage gap across regions is significantly different. The Asia region has the highest gap, the Oceania region has the lowest gap.

• have improved financial performance, are more innovative, and have better risk management.
• Stronger stakeholder relationships: Having a board that reflects the diversity of stakeholders, including women, can foster trust and understanding, leading to more sustainable business.
• Talent pipeline and role models: Increasing female representation on Boards creates a stronger pipeline of qualified women for future leadership roles and inspires ambitious women reach leadership positions.

While mandatory regulation has proven effective in some countries, achieving lasting change requires a multi-pronged approach. Fostering an inclusive culture within companies, addressing unconscious bias and investing in developing female talent are important steps to complement the regulatory framework.

Vietnam’s focus on gender equality initiatives and corporate governance reform demonstrates its commitment to creating a more diverse and equitable business environment. Continued efforts, both policy and cultural, will pave the way for stronger representation of women on Vietnam’s boards.

By embracing diversity and recognizing the valuable contributions of women leaders, we can build a more prosperous and inclusive future for business and society as a whole.