More Women on Boards, but Clarity on POSH Reporting Remains Elusive

WORLD

More Women on Boards, but Clarity on POSH Reporting Remains Elusive

23 DEC 2024

This article is based on the findings of Excellence Enablers’ ‘Survey on Corporate Governance,’ which examined governance practices in India’s top 100 companies from 2021 to 2024

The boardrooms of India’s top 100 corporations are seeing an encouraging rise in women’s representation, but a recent survey reveals troubling inconsistencies in handling workplace harassment cases under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (POSH Act).

The ‘Survey on Corporate Governance,’ conducted by the Delhi-based consultancy Excellence Enablers, analyzed the governance practices of India’s leading companies over a four-year period, from 2021 to 2024. This comprehensive study evaluated board structure, diversity, tenure, remuneration, and social responsibility through annual reports and NIFTY indices.

Progress in gender diversity was evident in the survey’s findings. By March 2024, the number of companies without a single woman independent director had fallen to five, compared to 21 in 2021. Public sector undertakings (PSUs) accounted for most of the laggards, with four PSUs and one public sector bank (PSB) still lacking compliance. The improvement is largely driven by the mandates of the Companies Act, 2013, and SEBI’s Listing Obligations and Disclosure Requirements (LODR), both of which require boards to include at least one woman independent director.

Additionally, women have made strides in top leadership roles, with five companies boasting women managing directors or chairpersons in 2024, up from two in 2021. The survey also noted that 15 companies consistently retained women in key managerial positions over the four years, a promising sign of long-term inclusion.

Despite these gains, the survey highlighted a stark gap in corporate responses to workplace harassment. Organizations are legally required to document and report incidents of sexual harassment, but many companies are falling short.

In 2024, 1,622 cases of harassment were reported, a marked increase from 660 cases in 2021. Of these, 1,464 cases were resolved in 2024, compared to 554 resolutions in 2021. However, over 20 companies reported zero complaints over the past four years, raising questions about underreporting or employees’ reluctance to come forward.

“The absence of complaints could suggest an ideal workplace or, more plausibly, a lack of confidence among employees in reporting incidents,” the survey stated. The study criticized the perfunctory manner in which cases are often handled. It flagged inadequate disciplinary actions and inconsistent resolution rates, noting that one company reported the highest number of cases—182 in 2024—but saw fluctuating resolution rates between 76% and 89%.

The survey also pointed out significant knowledge gaps among organizations regarding the POSH Act and inappropriate workplace conduct. Many companies appear to lack clarity on what constitutes harassment or how to handle such cases effectively. Mandatory workshops and awareness programs under the POSH Act remain underutilized, the survey noted, urging companies to prioritize these initiatives.

While the presence of women on corporate boards is a step forward, the real test of inclusion lies in creating workplaces where women feel safe and empowered to report harassment without fear of retaliation. As the survey emphasizes, gender diversity cannot be measured solely by boardroom numbers. It must extend to fostering equitable environments at every organizational level. Corporate India has taken significant strides in representation, but the journey towards true inclusion and safety is far from over.