FTSE 100 Reaches Initial Davies Target on Diversity
Monday’s City AM carried a report that the FTSE100 has finally reached the 2011 Davies diversity goal of 25% female representation on major Boards.
When Lord Davies gave his most recent update in March, the figure was 23.5%.
The June appointments of Diane Schueneman at Barclays, Irene Lee and Pauline van der Meer Mohr at HSBC and Mary Schapiro to the Board of the London Stock Exchange Group has seen the total reach 25.4% from the most recent calculation carried out by the Sapphire Group.
According to this latest analysis non-executive roles predominate with only 25 women in executive roles in FTSE 100 companies, around 9.5% of the total and 27 in the FTSE 250, making a still paltry 5% dent in overall executive roles.
Kate Grussing, head of Sapphire, told City AM “Hitting the target of 25 per cent is good news but... the lack of momentum of women gaining executive roles remains a challenge.”
Celebration, though warranted may mask the momentum question.
The Female FTSE Board Report of 2015 compiled by long-term diversity watchers at the Cranfield University School of Management reveals a plateau effect on appointments that raises questions for the future.
“This plateauing effect is caused by the high intake of female directors immediately after the Davies Report, but not sustained ever since,” Dr Elena Doldor one of the report authors told high profile business correspondent Dina Medland in a detailed feature following the reports release in March 2015.
“What is increasingly clear is that the UK needs to ‘up its game’ as the real goal is 33% women on our boards (or 40% of NEDs being women) by 2020, as set out in the EU proposed Directive. The latter also covers companies far smaller than those listed in the FTSE 350, possibly the top 650 companies in the UK.”
“It will be difficult to sustain the pace of change without more ambitious and sustainable measures. Our predictions suggest that as we approach 2020, women’s representation on FTSE 100 boards is likely to stagnate around 28%.”
“There are still not enough women on executive committees or in the executive pipeline…growing the female talent pipeline needs to be high on the agenda for every board, CEO and executive committee.”
Ms Medland follows up with detailed figures in an additional story yesterday revealing a worrying majority of FTSE350 companies don’t think they will meet diversity targets and remain sanguine about the prospect of never meeting any targets.
“Not only do 31% of businesses responding to the twice-yearly FT-ICSA Boardroom Bellwether survey report that they will not meet the target set by Lord Davies of 25% women on boards by the end of 2015....63% of those companies that are not expecting to hit the target also have no plans to do so in the short, medium or long-term.”
“This is the most pessimistic result for the drive for greater gender diversity since December 2012.”
The onus still remains with UK companies to demonstrate a voluntary approach delivers results