Lack of diversity plagues boards of SEA’s public tech firms

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Hello reader,

Board diversity is a complex matter with multiple layers that can be viewed from the perspective of age, ethnicity, gender, skills, experience, education, race, and religion, among others. With the plethora of factors that can change the equation, it is no easy task to set up a diverse board that is fit to govern a public company.

While it likely ranks high among the go-to corporate buzzwords among executives, boardroom diversity is a lot more than just a check in the box. Several studies have established a positive correlation between diverse leadership teams and financial performance.

A board filled with directors of different skills, genders, cultures, and ethnicities will likely bring unique and innovative perspectives to the table, which seemingly leads to better decision-making and effective risk management.

Investors have been central in pushing board diversity up the agenda, wanting boardrooms to more accurately reflect the employees and customers they serve.

In fact, banking giant Goldman Sachs (GS, NYSE) will only take a company public in the US or Western Europe if it has at least two “diverse” board members, one of whom must be a woman.

Further, a study by London Business School showed that while there is no silver bullet to guarantee the success of a board, greater representation for women is reshaping board culture and dynamics for nearly all FTSE 350 companies.

Yet, despite mounting evidence connecting corporate performance with board diversity, Southeast Asia’s big publicly listed tech firms are lagging well behind their western counterparts. Sea Group (SE, NYSE) and GoTo Group (GOTO, IDX) even have all-male boards.

That’s the puzzle my colleague, Simon, seeks to piece together in today’s featured piece. He dissects boardroom diversity from multiple angles – from board size and work experience to gender and educational background – and also digs into how Indonesia’s big tech places an emphasis on candidates with previous government ties.

Further, the premium story paints a holistic picture from a global perspective of where Southeast Asia stands regarding boardroom diversity.

— Shravanth

THE BIG STORY

Image credit: Timmy Loen

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