The Canada Pension Plan Investment Board is adopting a new global policy to improve gender equality and increase the representation of women on corporate boards.

Under the policy, the CPPIB will vote against committee chairs responsible for director nominations at investee public companies if the boards don’t have women directors.

Read: CPPIB highlights efforts to encourage women on boards in sustainability report

“We believe companies with gender-diverse boards are more likely to achieve superior financial performance over the long term,” said Mark Machin, president and chief executive officer at the CPPIB, in a news release. “For that reason, engaging with companies to drive better corporate behaviours is a key part of CPPIB’s mandate.

“We’ve been addressing board-effectiveness issues in our portfolio for many years and hope more institutional investors will join us in advocating for diverse boards.”

The CPPIB began its efforts to improve gender diversity by casting shareholder votes for 45 Canadian companies with no women directors in 2017. A year later, nearly half of those companies had appointed a woman director.

Read: Editorial: We are woman: A call for gender diversity, pay equity and workplace mentorship

Copyright © 2019 Transcontinental Media G.P. Originally published on benefitscanada.com

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