Boardroom blues

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The number of women in the workforce is rising across the Gulf but very few are making it as far as the boardroom. Is it time for the glass ceiling to be shattered?

Lubna Sulaiman Al-Olayan became the first female board member of a corporation in Saudi Arabia in 2004 when she joined the top management of the Saudi Hollandi Bank.

Fours years later she is still the only woman on the board of a Saudi publicly traded company, in a country with a population of 27 million people.

Of the 4254 board seats of companies across the Gulf, just 63 are held by women according to research report Power Matters: A Survey of GCC Boards from The National Investor and Hawkamah, The Institute for Corporate Governance.

That represents just 1.5% of the total. The figure is in stark contrast to the 13.6% female representation in American boardrooms and 22% in Norway.

Better representation of women at board level in the GCC is not just a battle of the sexes. Research indicates that women add a different perspective to the workplace, bringing in new skill sets and adding value to the corporate decision-making process with a direct impact on the balance sheet.

"This is not a gender issue of representation; it's a question of different sets of skills and abilities. Research shows that diversity can add value to boards," agrees William Foster, executive director of the Mudara Institute of Directors.

According to Catalyst, a non-profit organisation focused on women in the workplace, having women in the boardroom can significantly help improve financial performance.

In a study last year of the Fortune 500 companies, the group found that using return on equity as a measure of financial performance, companies with the highest percentage of female board members outperformed those with the least by an average of 53%.

"Women, for example, are better at employee relations and public relations in general than men so they bring a new perspective," agrees Dr Nasser Saïdi, chief economist at Dubai International Financial Centre.

Taking return on sales as a measure of corporate performance, companies with female members on the board outperformed their male-dominated counterparts by 42%. The report also finds that those companies with at least three female directors had notably stronger financial performance.

"It is not clear which way this goes. It could be that women do better financially and operationally or that well performing companies attract women," says Saïdi.

According to McKinsey & Company Middle East, soaring GDP growth across the Gulf region will raise average per capita income by over 80%, from less than US$20,000 to more than US$35,000.

But it's not just men who are benefiting from the regional economic boom. London-based fund management firm, Bramdean, estimates US$40bn of personal wealth in the Gulf is owned by women, up to 60% of which is held in cash.

While undeniably much of this wealth comes from the region's hugely successful family businesses, the number of females earning a high level of income is growing.

High-ranking female business leaders in the GCC include Dr Nahed Mohammed Taher, founder and CEO of closely-held Gulf One Investment Bank in Saudi Arabia, Salma Ali Saif Bin Hareb, CEO of the Jebel Ali Free Zone Authority in the UAE and Sheikha Lubna Khalid Sultan Al Qasimi, the first woman to hold a ministerial post in the UAE.

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