Guest post from ELE regarding equality in the boardroom.
A progress report from Cranfield School of Management, published 18 months after Lord Davies’ review into women on boards, has revealed some encouraging developments.
The report found that the number of women recruited to the boardrooms of the UK’s largest companies has increased, and there has been a notable commitment by business to remove the obstacles preventing women making it to the boardroom.
Signs of progress
Cranfield School of Management was asked by the Government to review the progress of the recommendations made in the Lord Davies Women on Boards report, which was published in March 2011.
The first monitoring report was published in October 2011. The second report, which has now been published, reveals that:
- Women now account for 17.4% of FTSE 100 and 12.0% of FTSE 250 board positions.
- Ninety-two FTSE 100 companies and 170 FTSE 250 companies now have at least one woman on their board.
- The percentage of new appointments going to women in both the FTSE 100 and FTSE 250 companies has risen, with 44.1% for FTSE 100 and 36.4% for FTSE 250.
No growth in number of female executive directors
The news isn’t all positive, however, as co-author of the report, Professor Susan Vinnicombe OBE, pointed out.
“The overall increase in female directors is positive,” she said, “but it does disguise the fact that the number of female executive directors has remained static, which is a cause for concern. In the twelve months to September 2012, there were 22 executive directors appointed and not one went to a woman.”
“Businesses must do more to identify and develop talented individuals within their organisations for executive directorships,” she explained. “Growing the talent pipeline needs to be at the top of the agenda in every boardroom. For companies to progress and compete they must have the best talent at the highest level and encourage all women to fulfil their potential.”
The progress report also reviews which FTSE 100 companies have become ‘early adopters’ of the recommendations set out last year by the UK Corporate Governance Code. FTSE 100 companies were encouraged to report their policy on boardroom diversity and report on the progress they make against any measurable objectives they have set themselves.
According to report co-author Dr Ruth Sealy, an encouraging 60% of the 92 reports analysed had a clear diversity policy, giving rise to hopes that a culture change is beginning to take place.
Forty-seven percent of the company reports demonstrated clear policies or measures specifically aimed at increasing women in senior management positions, and 18% of companies stated measurable objectives.
“The fact that a significant percentage of FTSE 100 companies already have clear diversity policies and have set and disclosed targets shows we have come a long way. This proves that the UK’s voluntary, business-led approach is having a positive impact. There is still a long way to go but the culture of the boardroom is changing,” said Dr Sealy
Headhunters to support gender equality
In a further move to encourage gender equality at a senior level, Business Secretary Vince Cable has recently urged all executive search firms to publish the numbers of men versus women they place in senior positions.
According to the Business Secretary, this emphasis on transparency will help highlight those firms that are going the extra mile to find high calibre female candidates and tackle gender imbalance in UK companies.