Shaping Vietnam's corporate future: female board members show business excellence

What are the advantages of having female members on the Board of Directors (BoD)?

Pham Viet Anh, chairman of the Board at PVTrans

From a practical perspective, my observation and experience suggest that certain skills and experiences required for BoD consultancy are more aligned with the qualities of female leadership than male. For instance, the attribute of caution, a critical criterion for the responsibility of a BoD member, is evidently more effectively executed by women.

Consequently, boards with female participation, as per statistics, show a reduction in corporate governance risks and an enhancement in financial efficiency. Moreover, female leaders, particularly in their 40s and 50s, after stabilising family and personal lives, demonstrate a remarkable surge in contribution, long-term thinking, and development capabilities, outpacing their male counterparts.

This age range is often considered ideal for BoD involvement, making this profession exceedingly suitable for women's career progression.

How do you view the current ratio of female board members in Vietnam compared to other countries?

Many countries, particularly in Northern and Western Europe, have long mandated a minimum of around 30 per cent female participation in the BoDs of listed companies. In 2022, the EU passed a regulation to increase this quota to 40 per cent by 2026. Globally, it's common to see female members in the BoDs of listed companies.

However, as of 2023, in Vietnam, the ratio of companies with at least one female BoD member is approximately 32 per cent, and those with two female members is around 14 per cent among listed enterprises. This indicates that the presence of women in Vietnamese corporate boards is relatively modest compared to other nations.

What mechanisms do you think are necessary to encourage an increase in female board membership, particularly in tech-heavy industries like PVTrans?

Our BoD currently includes seven members, of which two are women. This ratio aligns with PVTrans's long-term direction for BoD structure and our practical resource pool.

We have plans to seek successor resources for the BoD in general and female members in particular through planned sources and leadership training programmes, ensuring a certain proportion of women. Despite being an international transportation business with specific technical requirements, PVTrans has a significant number of female leaders in key roles, especially in areas like finance, capital management, and auditing.

We prioritise encouraging female employees with potential for development. Notably, PVTrans has been ahead in having female CEOs and chairwomen in its subsidiary units within the corporation.

With Japan recently implementing a law requiring listed companies to have about 30 per cent of women on their BoDs from 2030, do you believe Vietnam should introduce legal measures to increase female board participation?

I support this initiative, given its necessity and proven effectiveness in many countries and Vietnam's recent experience. Vietnam currently has a substantial number of female officers/leaders, many of whom are qualified and capable of pursuing a professional BoD member career.

Therefore, we could implement a phased approach. Initially, we should incorporate a minimum female BoD member ratio into Vietnam's corporate governance standards to encourage and guide companies. Subsequently, this could be integrated into legal regulations when conditions allow in terms of quantity and quality of resources.

MB leads the charge in green finance at VIOD 6th annual forum Military Commercial Joint Stock Bank (MB) has just been distinguished with the "Board of the Year" award, a testament to its role in propelling businesses towards environmentally sustainable practices on November 22.

Vinamilk dedicated to long-term roadmap in aid of net-zero goals There are long-term financial and operational commitments required to respond to the government’s net-zero goal. Le Thanh Liem, CFO of Vinamilk, shared with VIR’s Thai An the challenges that his business faces in the journey towards green and sustainable development.

Elevating the optimal capacity of corporate governance in Vietnam The 2022 OECD-Asia Roundtable on Corporate Governance, held in Hanoi in October, drew numerous stakeholders. The forum focused on building resilient and sustainable supply chains, which supports the implementation of corporate governance policies and practices in the region in accordance with the accepted global principles of corporate governance.

Vietnam’s path to enhanced corporate governance As the Vietnam Institute of Directors prepares for its Corporate Management Forum and its Board of the Year awards, VIR’s Dang Khoi spoke to CEO Phan Le Thanh Long about the current state and future prospects of corporate governance in Vietnam.