Alongside the publication of the annual Female FTSE Board Report, the government has named the business leaders undertaking a new review with the aim of raising the target to 33 per cent of women on boards by 2020.
The 2016 Female FTSE Board Report, produced by the Cranfield School of Management, found that the percentage of women on FTSE 100 boards increased from 23.5 per cent in March 2015 to 26 per cent this year. However, the percentage increase is very marginal compared to a report carried out in October 2015 by Lord Davies which recorded 26.1 per cent.
The percentage of women holding FTSE 100 non-executive directorships is currently 31.4 per cent, compared to 28.5 per cent in March 2015 and 31.4 per cent in October that year. The percentage of women in executive directorships, however, is still only 9.7 per cent compared to 8.6 per cent in March 2015 and 9.6 per cent in October 2015. This drops to 5.6 per cent in the FTSE 350. Overall, the trends point to a relative stagnation in the pace of change since October 2015.
Perhaps not surprisingly, given the low numbers of women in executive positions on boards, the focus of the new government review will be on representation on executive committees and generally improving the pipeline within the whole of the FTSE 350. The review will also consider current research on the obstacles preventing women’s progression and how to drive improvements. It will be led by Sir Philip Hampton, chair of GlaxoSmithKline and Dame Helen Alexander, chair of UBM.
In order to meet the target of 33 per cent for FTSE 350 boards, a constant turnover is required and an appointment rate of one in three board positions need to go to women. As such, those who chair committees and search consultants are being urged to ensure that the board appointment process is transparent and gender-inclusive.
Iain Birrell of Thompsons Solicitors commented: “The increase in the representation of women on FTSE 100 boards has been slowing down - to a point of near stagnation - since October last year and this indicates both that the underlying barriers to access are not being addressed, and that the government’s own target is likely to be missed.
“The announcement of another review into improving female representation is an old trick that will probably serve to kick the issue into the long grass. We should worry that this government, like its predecessors, will continue to shy away from introducing legal requirements that would force companies to address gender imbalance in the boardroom. Unless significant steps are taken now, this issue risks being overlooked while the government focusses on disentangling UK and EU legal institutions.”
To read the 2016 Cranfield report, go to:
http://www.cranfield.ac.uk/som/~/media/images-for-new-website/centres/school-of-management-centres/global-centre-for-gender-and-leadership/female-ftse-board-report-2016.ashx?la=en
To read the government announcement, go to:
https://www.gov.uk/government/news/rallying-call-for-female-boost-in-business-and-the-boardroom