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Despite increasing efforts by companies in India to enhance gender diversity in top management positions, women continue to be starkly underrepresented in chief financial officer (CFO) roles. According to reports, among the top executives of 2,328 NSE-listed companies, only 50 women hold the position of CFO or director of finance. This figure is notably low considering the overall number of companies surveyed, which includes 2,140 Indian private companies, 79 PSUs, and 109 global multinationals.
Industry experts attribute the persistent underrepresentation of women in CFO roles to various challenges, including inherent bias against women and companies’ struggles to retain high-potential women through critical life stages. While some progress has been made in recent years, traditional founder-led companies still exhibit biases against women, limiting their embrace of diversity initiatives compared to multinational corporations and firms in the financial sector.
The slow progress in achieving gender parity in CFO roles comes despite a rising number of mandates emphasizing the recruitment of women professionals for these positions. Executive search firms report that nearly one in three CFO mandates highlights the importance of identifying and hiring women candidates. Moreover, in more than half of these searches where all selection parameters are equal, a preference is given to female candidates.
Interestingly, the finance function is seen as conducive to work-life balance for women during key life stages, yet many companies fail to provide adequate support systems to retain high-potential women in finance roles. The talent pipeline issue is exacerbated by mid-career drop-offs due to maternity needs, despite a significant number of women chartered accountants in the workforce.
The changes
Although some large domestic firms and conglomerates are taking steps towards increased gender diversity in top management, challenges persist due to what is perceived as an overall talent crunch in finance leadership roles. Many women in finance gravitate towards consulting firms and the mergers and acquisitions space, further limiting the pool of female CFO candidates.
In light of these challenges, industry stakeholders acknowledge the need for sustained efforts to enhance gender diversity in CFO and other top management positions. While progress is evident with the growing visibility of female talent in CFO and legal roles, there is still ample room for improvement in creating inclusive leadership pipelines across industries.
