Board directors oversee the affairs of and maximise a company's business, by collectively directing its affairs and simultaneously meeting the interests of shareholders and stakeholders. These includes business and financial issues such as determining the business strategies and plans that underpin the corporate strategy; ensuring the company's structure and capability are appropriate for implementing chosen strategies; and issues relating to corporate governance, corporate social responsibility and corporate ethics.

The question we need to ask therefore is "If a key role of a Board of Directors is to increase business performance, leading to maximising shareholder value, why then are capable women not appointed to more boards in Malta despite the clear evidence?"

Using well quoted data, Malta is more significantly underrepresented in both corporate boards and management positions compared to the EU average. The female share equals 3.0% in Maltese boards (EU-27 average 14.0%) and 20.0% in management positions (EU-27 average 33.0%).

The Business Case is Clear

Since 2004, an extensive but inconsistent body of research has demonstrated that diverse teams sustain higher and more consistent performance over longer periods and organisations that aggressively promote women to executive positions, have stronger financial performance with one quarter to one third higher profits than their industry average.

Catalyst (The Bottom Line: corporate performance and women's representation on boards) looked at three critical financial measures, comparing the performance of companies across most industries with the highest representation of women on their boards to those with the lowest representation.

• Return on Equity:On average, companies with the highest percentages of women board directors outperformed those with the least by53%.
• Return on Sales:On average, companies with the highest percentages of women board directors outperformed those with the least by42%
• Return on Invested Capital:On average, companies with the highest percentages of women board directors outperformed those with the least by66%

Finally, Credit Suisse Research Institute in a 2012 study (Gender diversity and corporate performance) compiled a database on the number of women - since 2005 - sitting on the boards of the 2,360 companies constituting the MSCI AC World index. The outcome shows that, "over a six-year period, companies with at least one female board member outperformed those with no women on the board in terms of share price performance."

Recent research by Kris Byron and Corinne Post 2016, examined conflicting research about whether the presence of women on company boards improves financial performance.

They conducted a meta-analysis of the research in which they combined 140 studies spanning 35 countries and 90,000 firms, the results of which were published in the Academy of Management Journal.

The key findings

Firms with women on their boards were more profitable. They uncovered two reasons why "Boards with female directors tend to make stronger efforts to monitor the firms. They spent more time in board meetings and were more likely to make efforts to monitor the CEO and the firm in general." They also concluded that" boards with more female directors are more likely to be concerned with and involved in influencing the firm's strategy."

They suggested that "efforts to ensure director accountability and to open educational and employment opportunities to women may provide the conditions that will motivate firms to select female directors for their performance-enhancing potential."

A further huge study found that companies with more women leaders were more profitable. New data from the Peterson Institute for International Economics and EY, 2016, strengthened that case. The groups analysed results from 21,980 global, publicly traded companies in 91 countries from various industries and sectors and showed that having at least 30% of women in leadership positions, or the "C-suite," adds 6% to net profit margin."

"The evidence on women in the C-suite is robust: no matter how we examine the data we get the same result: women in the C-suite are associated with higher profitability." The C-suite results were clear: "more women translated to higher profits"...and that "having more women on boards is associated with having more women in leadership, otherwise known as the pipeline effect."

Should shareholders be concerned that profits are not being maximised by its board directors? The answer to that is yes. So why is there a clear contradiction between the composition of boards in Malta and their ability to achieve the best results for shareholders and stakeholders?

Advocates for gender equality have argued largely on the basis that this is not just about fairness, less so about better business results. Professor Laura D'Andrea Tyson told a panel at the 2016 World Economic Forum, that the gender parity debate is wrongly focused on fairness. Women, she argued, improve innovation and complex decision-making. "We have failed to make the business case".

Finally, McKinsey (2015) stated "Gender equality is not only an issue of fairness but also....a matter of attracting the best workers, at least half of whom are women. Diversity needs to be positioned as a business priority, a push that unites progressive, future-oriented leaders in a common cause: the performance and sustainability of their business."