Board diversity: Policy should weigh benefits and costs

THE topic of diversity in the corporate boards of publicly listed firms has captured the attention of various interest groups. Since 2012, at least 80 news articles in Singapore have highlighted the importance of diversity in a firm's upper echelons.

While corporate boards may be diverse in various ways, much of the attention has focused on gender diversity. For instance, it has been widely reported that women occupy around 8 per cent of board seats in SGX-listed firms, a number that pales in comparison with other advanced economies such as Australia and Britain.

Apart from gender, other forms of diversity have also been discussed, albeit less so. For instance, committee members from the Singapore Institute of Directors have delivered excellent discourse on boardroom diversity in term…