POWER and utility companies with more women on their boards have higher average return on equity (RoE), according to EY research published today.
Out of the top 100 companies in the sector, those with the most diverse boards had an average RoE of 7.7 per cent, compared to just 4.5 per cent for those with the least diverse. Just four per cent of executive board positions at the world’s top power and utility companies are held by women.
The sector has also under-performed global equity markets on price by two thirds over the past five years, said the report.
“Diverse boards deliver for companies; but the pace of change in power and utilities is out-distancing the pace of change in the boardroom,” said Alison Kay, head of power & utilities at EY. “The importance of having diversity in the senior management team is being overlooked by the industry at a time when it needs new thinking and new approaches to resolve the energy trilemma: how to provide energy that is available, affordable and environmentally sustainable.”