According to Bloomberg Intelligence, organisations in Japan with more female directors outperform their rivals in terms of stock market performance. Over three and five years, organisations listed in the top 10% for female directorships beat the Topix index (Tokyo Stock Price Index) by nearly 7%, according to the survey.
According to Bloomberg Intelligence, there is a potential upside for Japanese equities if companies make an attempt to narrow the gender gap on corporate boards with their worldwide rivals. According to the Organisation for Economic Cooperation and Development (OECD), women occupied only 15.5% of director positions in Japan’s largest companies in 2022 whereas the US held 31.3%. For example, Sony Group has profited from having more women on its board of directors.
Sony upped their female director share to 33% in 2020, up from 15% two years ago. Since then, the stock has easily outperformed the Topix index.
Japan is likewise making progress towards gender diversity, with a goal of having at least 30% female participation on large organisation boards by 2030, highlighting the link between diversity, creativity, and growth.
According to The Japan Times, investors such as Sumitomo Mitsui Trust Asset Management and Nomura Asset Management consider gender diversity when voting on board-election bids, preferring firms with female director candidates.
While Bloomberg Intelligence discovered that having more women on boards has a positive impact on stock market performance, it also discovered that it has not necessarily led to higher compensation for women in leadership roles, and the country still struggles with a significant gender pay gap compared to other OECD nations, according to a WTW analysis of 2,800 organisations.
