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Why Singapore Needs More Women Business Leaders

Credit: Nathan O'nion

In 2013, just 8.3% of women held directorships on boards of Singapore-listed companies, if studies by Diversity Task Force are anything to go by.

Even though the percentage has been rising steadily from 5.8% in 2009, the numbers are still low when taken in a global context. According to GMI Ratings, a major international corporate governance ratings firm, 11% of board directorships for around 4,000 companies worldwide are held by women.

That’s a real pity for Singapore though, as the benefits of having more women on corporate boards are manifold. For instance, there’s an interesting study which shows how firms with the greatest percentage of women as board directors produced returns on equity which are at least 53% higher on average than firms with the least percentage.

In a bid to help improve the situation, the Diversity Action Committee (DAC) was recently formed in Singapore with the aim of boosting female representation on the boards of companies here. The committee will be headed by Singapore Exchange Limited (SGX: S68) Chief Executive Officer, Mr. Magnus Bocker. Speaker of Parliament, Mdm. Halimah Yacob would assume the role of adviser for the committee.

As the DAC looks into increasing the representation of women on the boards of directors, let’s take look at three listed firms that already have women as their corporate leaders.

1. Singapore Telecommunications Limited (SGX: Z74)

Many know what Singapore Telecommunications, or Singtel, does – it’s after all, Singapore’s largest telecommunications operator. However, not many may know that it is headed by Ms Chua Sock Koong, who has been Group Chief Executive Officer since 2007. She is also the Executive and Non-Independent Director of Singtel.

Presently the largest company by market capitalisation listed in Singapore, Singtel derives more than half of its revenues from outside Singapore. It has also been steadily increasing its dividends, less capital reductions, from 5.5 Singapore cents per share in the financial year ended 31 March 2005 (FY2005) to 16.8 Singapore cents in FY2013. The firm has a dividend policy of paying out 60% to 75% of its net profit as dividend.

The telecommunications outfit is currently trading at 18 times its historical earnings and sports a dividend yield of 4.3%.

2. The Straits Trading Company Limited (SGX: S20)

Straits Trading Company has interests in real estate, hospitality, resources, and investments that span the Asia Pacific region and its Executive Chairman is Ms Chew Gek Khim. Ms Chew is a lawyer by training and has been Chairman of the firm since 2008. She also sits on the boards of ARA Asset Management Limited (SGX: D1R) and SGX.

Ms Chew came on board ARA Asset Management after a link-up with the asset manager in October last year. Less than a year later, it was reported that Straits Trading was looking to sell its building at Battery Road.

The firm is trading at 0.9 times its historical book value at its current price.

3. Auric Pacific Group Limited (SGX: A23)

Ms Saw Phaik Hwa, who was the former leader of SMRT Corporation Ltd. (SGX: S53), is now steering the ship at Auric Pacific Group. She is the company’s Executive Director and Group Chief Executive Officer.

Auric Pacific’s a food and beverage company which owns bread brands like Sunshine and Top One. It also has Food Junction Holdings Limited and Délifrance Asia Limited under its wings, among others; the two subsidiaries run the Food Junction and Delifrance outlets in Singapore.

For the first half of 2014, the company’s turnover increased 6.8% year-on-year to S$207.8 million, mainly due to higher revenue from its Food Group segment, which consists of wholesale, distribution, and manufacturing of food products. However, net profit plunged 58.6% to S$1.5 million on the back of an increase in operating expenses. Going forward, Auric Pacific expects pressures on manpower and rental expenses to continue. Despite that, it “remains committed in managing its business risks and cash flow prudently” and is also taking steps to improve its operational efficiency, realign its resources, and tap on to new business opportunities.

Shares at Auric Pacific last changed hands at S$1.17 on Thursday.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Sudhan P owns shares in ARA Asset Management Limited.