The 2019 report of the Hampton-Alexander Review was published on 13 November 2019. This is the fourth annual publication of the UK government-backed initiative to improve gender diversity and balance in FTSE leadership. The report highlights two important facts.
Women on boards
FTSE 350 companies have hit the target of achieving 30% of board roles held by women. This is a milestone and a material improvement from the under 10% of female representation ten years ago. There are only two companies within the FTSE 350 that still have an all-male board (in 2018 there were five) and 39 that have only a single woman on their board (in 2018 there were 74). That said, only 25 boards have female chairs.
Women in senior executive leadership positions
Progress to improve gender diversity in executive leadership roles has been limited and there is still a long way to go to reach the target for women in senior leadership roles below board level:
- Only 14 of FTSE 350 companies have female CEOs.
- 44 companies still have all-male executive committees.
- The female representation on executive committee stands at 20%.
The pace of change in the representation of senior executive leadership roles needs to dramatically accelerate and progress to date is not good enough.
What can be done?
Stakeholders have a role to play in requiring boards and executive teams to do more. Institutional investors have been a lot more vocal in recent years and have voted against boards when not enough was done to promote diversity.
Non-executive directors (NEDs) have a role to play in addressing diversity issues, in accordance with good governance practices and provisions of applicable governance codes and standards. They must hold management to account. For example, NEDs should request data to understand retention, promotion and appraisal practices and to identify unconscious (or conscious) bias that may be holding back the careers of some female senior leaders.
Let’s not forget that diversity is broader than gender diversity. While the percentage of women on boards has increased, women that get a seat at the table tend to be white and have similar backgrounds to male board members. Effective boards demonstrate diversity of thought and experience, which is achieved when there is a diversity of age, ethnicity and social background, and gender. For further information, see Practice note, Gender diversity in boardrooms.
The role of NEDonBoard in pushing for further changes
Training, workshops and events
NEDonBoard provides the educational support that boards and NEDs require to unlock the potential of their workforce. In June 2020, NEDonBoard will host roundtable meetings and a Board Best Practices® event on the topic of culture, diversity and inclusion.
Women in senior executive leadership positions are far more likely to be appointed to the board if they become a board member (perhaps in the not-for-profit sector), as a board adviser or with a company whose board responsibilities are non-conflicting and compatible with their executive career. NEDonBoard has designed transitioning programmes for senior executives looking to access the boardroom.