STUDY: Mining Companies Need More Women in the Board Room
As of today, women occupy a mere eight percent of all board seats in the top 100 mining companies, with only four female executive directors in this group.
According to a new study by Women In Mining (UK) (co-authored with PwC), companies with women on their boards excelled in profitmaking, environmental and social sustainability, as well as a wealth of other factors.
The study took the top 500 mining companies by market capitalization and counted the number of women on their boards. Evaluating the companies based on 75 different metrics, including profitability and return on capital, the survey compared the results to the number of women on their boards and came up with a comparison of how companies with women on their boards did versus companies without women on their boards.
According to Amanda van Dyke, chair of Women in Mining (UK), women in leadership positions have been correlated to better profitability overall, better return on capital, lower risk and better environmental social and governance management.
“Our findings show that despite the fact that there are considerably fewer women on mining boards, 7.9% actually in the top 500 mining companies, those women made a huge difference to how those companies performed.
Over three years, we found that mining companies with women on their boards approximately doubled the return on capital employed, enterprise value/reserves and dividend yield compared to companies that had no women on their board. Actually the earnings per share were 13 times higher for companies that included women. The real winner is the shareholder. There's no question about it.”
According to the results of the study, mining companies listed on the Johannesburg Stock Exchange (JSL) had the best level of female board representation, while those listed on the London Stock Exchange (LSE) had the worst level of representation.
Overall, the mining sector had the worst number of women on boards of any industry group in the world.
Examples of companies that have brought women into management roles or onto their board include Rio Tinto, Anglo American, and Newmont Mining. Eira Thomas from Kaminak Gold Corp. and Diana Garrett from Romarco Minerals Inc. are both CEOs, and Catherine McLeod-Seltzer is chairman of Bear Creek Mining Corp.
Another advantage women on mining boards bring is higher profit margins. According to the survey, companies with female board representation had higher return on sales, higher return on invested capital and higher return on equity.
The study also documented the top companies at successfully implementing incentives or programs to bring women into these positions.
“I would definitely say that Rio Tinto and Anglo American stand out for putting those procedures in place,” said van Dyke.
“We've outlined in the report a number of ways that companies can encourage more women to move up the ranks and onto boards. It's actually not that hard. The problem is that you have to convince the people that run the mining companies right now that it's within their interest to more actively recruit women and keep women. That is the biggest problem.”
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