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The proportion of women appointed to Canadian corporate boards in 2018 fell sharply to the lowest figure in five years, raising the question of whether the drive to increase gender diversity at the director level has stalled.

The numbers come from the annual Spencer Stuart analysis of the boards of Canada’s 100 largest companies by revenue. Spencer Stuart, an executive-search and advisory firm, found that just 30 per cent of appointments of new directors in 2018 were women. That figure had topped 40 per cent every year from 2014 to 2017.

With the rate of new female directors in the 40-per-cent range for several years, the proportion of all corporate directors had steadily climbed to reach 27 per cent in 2017. The overall number stayed at 27 per cent in 2018.

“I think it would be [a] mistake to lose sight of the fact that the overall stock of women serving on boards has gone up and will continue to go up,” said Peter Simon, Canada leader for the firm. He and colleague Carrie Mandel say their clients remain committed to increasing gender diversity on boards, and the age of current board members (an average of 62) means there will be a continued refreshing at the top.

There are other bits of good news: For the first time in the study’s history, there were no all-male boards in the 2018 group of 100 large companies. Boards where women made up at least 30 per cent of the directors rose to 41 per cent of the group, versus 14 per cent in 2013. And there were 111 positions of board chair or committee chair held by women, more than double the 2013 level.

“I sincerely believe the faucet is open and the flow will continue … we should pick up this conversation in 12 months’ time, and if 2019 proves to be another 30-per-cent year, I’m going to be a little bit annoyed and that’s going to feel more like a stall," Mr. Simon said. "After two data points, that would feel like a thesis.”

Board diversity has been a focus for securities regulators and major institutional investors for some time.

The securities regulators have been pressing companies to offer better disclosure of how they choose directors and how diversity plays a role, with the Ontario Securities Commission introducing a “comply or explain” disclosure policy in 2014. But there’s been concern that disclosure policies aren’t enough, as OSC chair Maureen Jensen has observed that at current appointment rates, it could take three decades for women to achieve board parity with men.

The Canadian Securities Administrators (CSA), an umbrella group for the provincial regulatory bodies, issued its latest report last fall on women in the board and executive ranks. In a group of 648 public companies, just 15 per cent of board seats were held by women. While 66 per cent of companies had at least one woman on their board, 218 companies had none. The CSA said the numbers of women on boards tended to increase with the size of the company, which is consistent with Spencer Stuart’s observations.

Meanwhile, Canada Pension Plan Investment Board said in December that for 2019, it would take global its Canadian policy to vote against the chairman of a company’s director-nominating committee if the board has no female members.

CPPIB spokesman Michel Leduc said the pension fund established its Canadian policy in 2017 and cast votes against committee chairmen at the shareholder meetings of 45 companies with no female directors. CPPIB then tried to engage with those companies. “A year later, nearly half of those companies had appointed a female director ... . Gender diversity strengthens the board’s stewardship function, helping a company’s drive to achieve superior financial performance over time,” Mr. Leduc said.

Pamela Jeffrey, founder of the Canadian Board Diversity Council and now a KPMG partner who’s the National Lead for its Inclusion and Diversity Strategy practice, says the Spencer Stuart numbers indeed concern her. “I think it has hit a stalling point – I don’t think this is an aberration.”

Ms. Jeffrey said that numbers increased in the CSA annual reports as regulators applied pressure, but the fall report showed a slowing – and made her wonder about what the next steps are. Only half the companies in the Spencer Stuart report have created any kind of target number for board gender balance, she says, and the CSA noted more than 200 companies in the larger group have none. “We’re not going to see the pace increase until we get some good governance.”