[Analysis of Female Outside Directors]② Only 3 Financial Firms Have Equal Male and Female Numbers... Still a 'Tilted Playing Field'

Results of a Full Survey of 47 Domestic Financial Companies... Female Outside Directors Account for 22.58%
Among 62 Financial Holding Companies, 16 Are Women... KB Financial Group and Shinhan Financial Group Have Female Chairpersons
Regional Financial Groups Show Noticeably Low Numbers... Hyundai Card, Woori Card, and KB Securities Have '0'

The proportion of female outside directors in the domestic financial sector?including financial holding companies, banks, non-life insurance, and credit card companies?generally increased compared to a year ago, but companies with an equal number of men and women remain rare. The proportion of female outside directors in life insurance and securities either stagnated or slightly decreased, and some regional banks as well as Hyundai Card and Woori Card did not appoint any female outside directors this year, continuing the trend from last year.

Diversity in the professions of female outside directors remains insufficient. Among current and former professions, professors accounted for about 60% of female outside directors. While the proportion of business executives slightly increased mainly in financial holding companies and banks, the share of professionals such as accountants and lawyers decreased.

On the 16th, Asia Economy conducted a full survey of 47 domestic financial companies comparing the status of female outside directors in 2023 and 2024. The proportion of female outside directors in the financial sector rose slightly from 20.89% in 2023 to 22.58% in 2024. The analysis covered 237 outside directors from the five major financial holding companies, three regional financial holding companies, 11 banks, five life insurance companies, five non-life insurance companies, eight credit card companies, and 10 securities firms. The number of female outside directors in the financial sector increased by nine, from 44 last year to 53 this year.

The sector with the highest proportion of female outside directors was non-life insurance, where women made up 30% of all outside directors. This was followed by financial holding companies at 25%, life insurance at 23%, and credit cards at 22%. Securities and banks recorded relatively low proportions at 19% and 16%, respectively.

The sectors with the steepest increases were financial holding companies and banks. Last year, the proportion of female outside directors in financial holding companies barely exceeded 20%, but this year, with active appointments, the share increased by more than 4 percentage points. Among 62 outside directors, 16 were women.

Among financial holding companies, as of last March, KB Financial Group appointed three female outside directors out of seven, while Shinhan, Hana, and Woori each increased their number of female outside directors by one. Notably, KB Financial Group appointed former IBK Industrial Bank of Korea President Kwon Sun-joo as the chairperson of the board this year, establishing its first female chairperson system. Shinhan Financial Group appointed Professor Yoon Jae-won of Hongik University as board chairperson, reinstating a female chairperson system after 14 years.

The proportion of female outside directors in banks also rose from 12% to 17% during the same period. Woori Bank, which had been reluctant to appoint female outside directors until last year, appointed Professor Choi Yoon-jung from Yonsei University’s Department of Economics as an outside director, increasing the total number of outside directors from four to five. KB Kookmin Bank also newly appointed lawyer Lee Jung-sook, raising the number of female outside directors from one to two.

However, the proportion of women on the boards of regional financial holding companies was noticeably low. BNK Financial Group and DGB Financial Group each increased their total number of outside directors by one but maintained the same number of female directors, causing the female proportion to drop to the 14% range. JB Financial Group, by increasing its outside directors from seven to nine and adding one female director, surpassed 20% for the first time.

Meanwhile, the increase in the proportion of female outside directors in banks, credit cards, and non-life insurance was around 2 percentage points, while securities saw no change, and life insurance decreased by 1.19 percentage points.

Some Regional Banks Have Zero Female Outside Directors... Hyundai Card, Woori Card, and KB Securities Remain Unchanged

Looking at individual financial companies, regional banks were reluctant to appoint female outside directors. Busan Bank increased its number of outside directors this year as it did last year but did not appoint a single female director. Daegu Bank also had no female outside directors among its five directors last year and this year, and Gwangju Bank (four directors) and Jeonbuk Bank (four directors) were the same. This contrasts with Jeju Bank, which appointed women as half of its outside directors, two out of four.

Except for KB Kookmin Bank, other commercial banks also appeared passive in increasing the proportion of women. While KB Kookmin Bank raised the proportion to 40% by appointing two female outside directors out of five, Woori Bank appointed its first female outside director this year, and Shinhan Bank, Hana Bank, and NongHyup Bank each maintained only one female outside director this year as they did last year.

The proportion of female outside directors in credit card and securities companies showed little change, but the composition of their boards varied significantly. Woori Card, which had been criticized multiple times for having only male outside directors, did not appoint any female directors among its four outside directors this year either. Hyundai Card also had no female outside directors among its five directors this year. In contrast, Hana Card appointed two women out of four directors (50%), and Lotte Card appointed two women out of five directors (40%).

Among securities firms, where only nine of 46 outside directors are women, there was no change in the number of female outside directors from last year to this year. KB Securities still has not appointed a single female outside director, and Korea Investment & Securities (six directors) and Hana Securities (six directors), which have the largest number of outside directors, each have only one female director.

Professors Constitute About 60% of Female Outside Directors... Career and Occupational Diversity Remains a Challenge

Occupational concentration among female board members remains unresolved. The financial sector’s board composition is often called a “professors’ gathering” due to the persistent concentration of professors, and female outside directors are no exception, with about 60% being professors.

Professors are relatively less controversial compared to other professions and are traditionally preferred by the financial sector. The financial sector explains that former prosecutors, judges, and high-ranking public officials are less actively recommended because their backgrounds can lead to various interpretations and prejudices.

By sector, the proportion of professors among the five major financial holding companies and regional holding companies exceeded 62%, increasing by 4 percentage points from last year. The proportion of business executives rose by 8 percentage points, and public officials (researchers) by 6 percentage points, but these mostly filled the vacancies left by accountants and lawyers. Among major financial holding companies, Shinhan Financial Group has three female outside directors who are professors, and Woori Financial Group and NH NongHyup Financial Group each have two. KB Financial Group and Hana Financial Group appointed female business executives for two-thirds and half of their female outside directors, respectively.

The proportion of female outside directors who are professors in banks exceeded 66%, and in non-life insurance, it reached 83%. Life insurance showed a relatively balanced distribution among accountants, lawyers, business executives, and public officials (researchers), but even there, professors accounted for 40%, twice as many as other professions.

Meanwhile, the average age of female outside directors was lowest in securities at 52 years and highest in credit cards at 61 years. Except for a decrease in the average age of female outside directors in non-life insurance from 57 to 55, the ages in other sectors were generally similar to last year.

This content was produced with the assistance of AI translation services.