top of page
  • Writer's pictureMark Baxter

32% of ASX50 companies have inclusive board policies. Is this moving the dial on true diversity?

Updated: Oct 9, 2023

Why is broader boardroom diversity important?

It has been proven that diverse boards make better decisions and are able to increase profitability significantly. Are Australian boards diverse and do they have the structures to embrace diversity in all its forms?

In what I understand to be the first piece of research into the diversity arrangements of ASX boards in Australia by Australians, 16 of the ASX50 have diversity and inclusion policies which apply to their boards and directors. Has this assisted with creating fully inclusive boards in Australia?

Recently (April 2023), a US based advocacy business OUT Leadership published a review of Board Diversity in the US, UK, Australia and Hong Kong (source: LGBTQ+ Board Diversity: Progress & Possibility – Out Leadership April 2023). In this publication, the results for Australia were that only 7 companies in the ASX200 had a board diversity policy which was inclusive of the LGBTQ+ community and only 1 of these companies was in the ASX50 (Allkem).

As a result of Australia’s apparently poor showing in the OUT Leadership research, I have reviewed the governance frameworks of the ASX50 and the news is not as bad as the US based OUT Leadership would have us believe. However, the message is far more nuanced when it comes to major boards embracing diversity in all its forms and not just in respect of the LGBTQ+ community.

It was a relief to find that far more than one company in the ASX50 had diversity policies which applied to Directors and that the Nominations Committee had to consider diversity when considering the appointment of new non-executive directors. However, in many instances there seemed to be a disconnect between the reporting of diversity statistics and the actual board approved policies that are in place.

It was incredibly pleasing to find that 16 of the ASX50 have inclusive diversity policies

which apply to their directors. Where there was ambiguity about whether the policies applied to the directors or board these were not included in the numbers – however the number could be higher.

Within the firms that had inclusive policies that applied to directors a standout from both a governance and reporting perspective is Woodside Energy. The company’s Diversity and Inclusion Policy has an inclusive definition of diversity which the Corporate Governance Statement confirms applies to the Board.

This is the most comprehensive reporting of Board diversity in the ASX50 and it would appear that Woodside is fully embracing its board diversity policy.

In many other instances the Board diversity which is reported is limited gender, age and tenure with sometimes the addition of cultural background and First Nations representation.

One rule for the workers another rule for the directors?

A number of companies have a very inclusive definition of diversity for their staff but when it comes to board selection a much tighter definition of diversity is applied. One example is CSL Limited - the policy (source: CSL Diversity & Inclusion Policy – 1 July 2020) which applies to the workplace is a very inclusive and modern definition however when we review the Board Charter (source: CSL Board Charter adopted 16th June 2021) it only calls out gender, age, and social and ethnic backgrounds – while we do have the legal nicety of “including” why does this not reflect the diversity policy which applies to the staff?

ASX Limited has a broadly inclusive policy (source: ASX Diversity & Inclusion Policy February

2019/Version 2) which applies to all the staff. However, the Nominations Committee charter for ASX Limited limits the diversity consideration of new board members to gender diversity only (source: ASX Nomination Committee Charter – Reviewed March 2019).

In a number of instances there is a broad requirement for the Nominations Committee to consider diversity but there appears to be no obligation to follow the actual board approved diversity and inclusion policy which applies to the actual staff. This appears to provide some

flexibility in the way the Nominations Committee and the Board can consider diversity.

Does it feel right for the board to apply a narrower definition of diversity than what applies to the company’s staff?

A number of these companies have been held up as role models from an LGBTQ+ perspective by advocacy groups but if a fully inclusive board is not pursued shouldn’t this be cause for concern?

Measurable objectives? Data is needed.

The Commonwealth Bank (CBA) has a modern and broad diversity and inclusion policy which applies to directors.

The CBA’s diversity and inclusion goals on their Boards states that they will achieve 40% male, 40% female, and 20% of any gender that holds the relevant skills (source: CBA’s Corporate Governance Statement 2022 and the document Inclusion and Diversity at CBA – October 2022). While public disclosures include workforce targets around diversity the disclosures in respect of the board are silent on anything but gender. Unlike the CBA boards, in respect of CBA’s workforce there is extensive reporting of broad diversity dimensions.

CBA’s Corporate Governance Statement refers to “measurable objectives” in a number of instances – where is the measurement of other forms of underrepresentation such as LGBTQ+ , disability etc. Even though a broad policy is in place are there processes in place to find board ready candidates from these groups or is there a reliance on the view that these groups are not “measurable”? If certain aspects of diversity are not measured is it assumed that there is no need to consider other aspects of diversity? Further, why the silence in public disclosures around non-gender aspects of diversity at the board level?

The definition of diversity?

The vast majority of the ASX50 had an inclusive definition of diversity which covered many of the following attributes of diversity. Commonwealth Bank of Australia has a very comprehensive definition of diversity as follows:

“A collection of individual attributes that includes, but is not limited to, demographic diversity, cognitive diversity, background and lived experience. Demographic diversity may be visible or invisible and may include (but not be limited to) gender, marital or family status, sexual orientation, gender identity, age, disability, ethnicity, caring or family responsibilities, religious beliefs, cast, cultural background, socioeconomic background, perspective and experience.”

Further, it would appear that other company definitions are evolving as in some instances gender identity has not been included and it is still relatively rare for socio-economic background and neurodiversity to be included.

Of interest is exclusions or “carve-outs” from the policy that some organisations apply for example XERO Limited has a fully inclusive definition of diversity within its policy but then goes on to say later within their policy that their focus is on gender and ethnic diversity (source: Xero Diversity and Inclusion Policy – December 2022).

The question needs to be asked is this at the exclusion of all else or is there a priority order being imposed? Pilbara Metals has a diversity and inclusion policy which applies to directors and the workforce but seemed to be an outlier as it currently does not include sexual

orientation or LGBTQ+ in its definition of diversity but includes gender identity (source: Pilbara Minerals Inclusion and Diversity Policy - 24th June 2021).

In addition, there has been an attempt to define diversity in some policies in the broadest possible sense without reverting to identity. While this is understandable it may cause some ambiguity as to the overall intent and may lead to a lack of clarity.

Qantas has such a definition which does reflect the need for diversity of thought but does not state diversity from an identity perspective (source: Qantas Inclusion and Diversity Policy 2019). However, if you look at Qantas’ other disclosures it appears to have programs which embrace diversity. Further, as we all know the outgoing Managing Director of Qantas is an out proud level which should be embraced in the pursuit of great outcomes.

In conclusion...

I am a firm believer in the fact that there are currently great board ready candidates

in the First Nations, Disability, LGBTQ+ Communities in Australia and that boards

and board search firms need to cast their net wider to engage these potential

candidates. However, boards in Australia seem to remain doggedly stale, pale and

from privileged backgrounds. Further, it would appear that while inclusive policies

are in place in quite a number of the ASX50 the reporting and processes in place do not

appear to enable a full implementation of these policies at the board level.

I believe that there is something very wrong about a board neither reflecting their workforce, their customers nor the population. Having the policies is a good start but we need to embrace and implement these policies.

This is an early release of ALBEI’s research – the next phase is the ASX100 and then the ASX200. The different governance and reporting approaches across most companies is pointing to the need for clarity around reporting across the various aspects of diversity. This may take the form of ASX listing rules or perhaps legislative compulsion. As a precedent the

Workplace Gender Equality Agency requires mandatory reporting of gender equality statistics and perhaps now is the time to extend this beyond gender as this has made gender reporting a standard process in Australia.

Data is crucial – Woodside Energy has proved in can be done at the Board level. Surely the rest of the ASX50 can do this as well?

Mark Baxter – Co-founder Australian LGBTQIA+ Board & Executive Inclusion (ALBEI)


The boring bit – methodology adopted.

There is no cookie cutter approach to board governance frameworks in Australia and many have evolved their own nuances which need to be interrogated.

In carrying out my review of the ASX50 I first considered the Diversity & Inclusion Policy of a company to see if it applied to its directors, moved on to the Nominations Committee (or Equivalent) Charter to see if there was an obligation to consider diversity and then to the company’s Corporate Governance Statement to see how “diversity” was reported in the public domain. Further, where the wording of the diversity and inclusion policy is ambiguous this is sometimes clarified by the Corporate Governance Statement or other artefacts.


Inspired to continue the discussion?

Interested in helping? You can contact us here to get in touch with the ALBEI team.

43 views0 comments

Recent Posts

See All


bottom of page