The Journalistic Desk:
In a landmark move towards gender inclusion, the UAE has introduced a new mandate that requires all private joint-stock companies to have at least one woman on their boards of directors. This reform, set to take effect in January 2025, is part of the UAE’s broader efforts to empower women in leadership roles across the business sector. The move extends a similar policy that was implemented for public companies in 2021, which has already seen positive outcomes in terms of institutional performance and governance.
Gender Equality in Leadership
The UAE’s government has been a strong advocate for gender equality, continuously promoting women in leadership. The country established the Emirati Gender Equality Council in 2015 to further its agenda of reducing the gender gap in various sectors, including business. The UAE’s commitment to gender parity is further reflected in its significant rise in the United Nations Gender Inequality Index, where the country climbed from 49th in 2015 to an impressive 7th place in 2024(FastCompanyMEA).
Women in the UAE have already been making strides, especially in politics, where they occupy 50% of the seats in the Federal National Council. This corporate reform reflects the government’s vision to build on this momentum by empowering women in the private sector and fostering inclusive corporate environments.
Why This Reform Matters
This decision is more than a symbolic gesture; it aims to improve corporate governance by leveraging diverse leadership styles. Numerous studies have shown that companies with gender-diverse boards perform better financially and are better equipped to handle risk and innovation. By mandating female representation on boards, the UAE seeks to enhance institutional performance and global competitiveness.
Abdulla bin Touq Al Marri, UAE’s Minister of Economy, emphasized that women are indispensable partners in the country’s economic growth. He stated that this decision will allow companies to benefit from the skills, insights, and experiences of successful women in business.
Who Can Be Appointed?
The mandate does not specify that only Emirati women can be appointed to boards of directors, which means that foreign women are also eligible to take on these leadership roles. Both local and expatriate women, provided they meet the necessary qualifications, can be appointed as board members. This ensures that companies can select the best talent, regardless of nationality, to meet their governance needs(
A Continuing Trend of Inclusivity
The UAE has been a pioneer in gender-inclusive policies. The mandate for female board representation aligns with broader global trends, following in the footsteps of countries like Norway, France, and Germany, which have enacted similar laws. By introducing these reforms, the UAE is setting a new precedent for gender equality in the Middle East.
This mandate will encourage more companies to embrace gender diversity, making it a core aspect of their leadership structure. Companies will need to start planning for this change as they restructure their boards in the coming years.
Impact on Businesses
While some smaller firms may find the transition challenging, larger multinationals operating in the UAE already have robust diversity and inclusion strategies in place. These firms are likely to welcome the change as a positive step towards better governance and leadership. The government is also expected to provide support, including leadership development programs, to ensure that women are prepared to take on these new roles.
This policy also aligns with the UAE Vision 2021, a strategy that aims to position the country as one of the best in the world in terms of innovation, competitiveness, and gender balance.
The UAE’s new mandate for private companies to appoint at least one woman to their boards of directors marks a significant milestone in the country’s journey towards gender equality. It is a progressive reform that aims to empower women, enhance corporate governance, and promote inclusive leadership. The UAE is not only setting an example for the region but also aligning itself with global standards in gender diversity and corporate responsibility(