In the wake of International Women's Day, the UAE has boldly moved forward with its push for gender equality following the Securities and Commodities Authority's (SCA) announcement that all listed companies in the UAE are to have at least one female member on their board of directors.
The announcement comes following the SCA's own board meeting, attended by the UAE Minister of Economy Abdulla Bin Touq, who said following the meeting that the authority’s priority in the coming period will be to upgrade the country’s markets to meet the highest global standards.
The requirement for gender diversity on the board of directors of listed companies has been explored by other jurisdictions around the world, with varied success. The UK Corporate Governance Code (the Code) contains mandatory "comply or explain" provisions which require the entity to address the disproportionate representation of a particular gender on corporate boards. The Code allows corporates to set their own gender diversity policies but requires that merit be an explicit consideration for candidate selection.
The UAE previously, under the 2016 Corporate Governance Rules, had a similar policy that at least 20% of the board members in listed local public shareholding companies must be female, but would accept an explanation where there wasn't compliance with these equality provisions. The SCA has now made female representation mandatory on the board of all listed companies.
According to Aurora50 – a social enterprise in the GCC - there are currently women on the boards of 28 of the 110 listed companies in the UAE (26% of the total), but women account for just 3.5% of the total board members (29 of 823). Aurora50 has recently signed an agreement with the Central Bank of the UAE to increase the number of women on the boards of private and public companies in the country. The intention is that the exchange of information and the building of a strong pipeline of female talent will improve gender equality.
The UAE has the highest level, in the Middle East and North Africa region, of women participating in the workforce, according to the World Bank, who stated that in 2020, 57.5% of women participated in the labour force. This follows in 2020 the UAE being the first country in the region to introduce paid parental leave in the private sector in an attempt to boost female participation. Also of note is the recent appointment earlier this year of Hana Al Rostamani as group CEO of First Abu Dhabi Bank, the largest lender in the UAE, as further evidence of the country's drive towards gender equality.
