Board Diversity Is Good, but Inclusion Is Important Too: Study of SGX Listcos

Why It Matters

The findings signal that Singapore’s boards risk under‑performing if they stop at diverse appointments and fail to foster inclusive cultures, a concern for investors demanding robust governance. Strengthening inclusion can translate into better decisions, risk management, and shareholder value.

Key Takeaways

• 73% of Singapore directors see diversity boosting performance, below global 85%
• Only 40% strongly agree diversity improves board discussions, versus 67% globally
• 55% say expanding nomination channels will advance board inclusion
• 73% feel comfortable challenging peers, lagging behind 88% global
• Chair's commitment identified as key driver of inclusive board culture

Pulse Analysis

Singapore’s corporate landscape has embraced gender and ethnic quotas, yet the latest Council for Board Diversity (CBD) and Egon Zehnder study reveals a nuanced shortfall. While 73% of local directors acknowledge that a more varied board can lift company performance, this optimism falls short of the 85% global benchmark. The disparity underscores that Singapore’s boards have largely caught up on the "what" of diversity—adding women and minorities—but lag on the "how" of leveraging those perspectives for strategic advantage. Investors and regulators worldwide are watching these metrics, as board composition increasingly ties to ESG scores and capital allocation decisions.

The study pivots to inclusion, defining it as the systematic integration of diverse viewpoints into boardroom dialogue. Only 40% of Singapore directors strongly agree that diversity fuels more insightful discussions, a stark contrast to the 67% figure abroad. Moreover, merely 73% feel comfortable challenging peers, versus 88% globally, indicating a psychological safety gap. Experts in the report argue that without a culture where dissent is welcomed, the theoretical benefits of a heterogeneous board remain unrealized. Board chairs emerge as the linchpin; their willingness to moderate pace, encourage debate, and set tone directly influences whether inclusion becomes a practice or a buzzword.

For companies, the implications are clear: expanding nomination pipelines and formalizing inclusive protocols are no longer optional. The 55% of directors who favor broader search channels signal a market shift toward proactive talent sourcing, while chair‑driven initiatives can embed inclusive norms into board charters and evaluation frameworks. As ESG reporting standards tighten, firms that demonstrate both diverse composition and measurable inclusion are likely to attract premium valuations and lower cost of capital. The study thus serves as a roadmap for Singapore’s boards to transition from token diversity to performance‑driven inclusion, aligning governance with global best practices.