UK gender diversity on corporate boards could be better, study shows

Even after campaigns, reviews, and many other initiatives to champion women on boards, the percentage of women on FTSE 350 executive committees was still at 16% in the middle of April.

According to a new report, some of Britain’s biggest publicly listed companies are still failing to achieve notable progress in this area.

The Pipeline – a website that trains women for senior positions - released the results of a study which shows that the number of companies with no women on their executive committees has increased since the previous year.

When looking at numbers of FTSE 350 women executives, who worked in positions such as deputy chief executives, chief finance officers, finance directors and managing directors, number had dropped from 38% to 35% in the last year.

Considering the huge push by the government over the last decade to balance the genders, the findings are very disturbing.

The Davies Review – which is Government backed – showed that the FTSE 100 achieved a milestone in 2015, with 25% of board positions filled by women. A follow–up review led by Sir Philip Hampton and Dame Helen Alexander set the goal for one third of the FTSE 350 to be comprised of women by 2020. This goal is falling behind, and has in fact flat-lined. The number of women who are in senior executive positions has remained steady at 6%, with a total of 60% of women on executive committees being in human resources positions.

The Pipeline research shows that in companies with no women on the executive committees, the performance levels are lower than in companies which have ladies on their committees. Companies with no female representation perform worse in terms of net profit.

One fact which came to light, was that if all FTSE 350 companies performed at the same level of those companies with female representation, the impact could be in the region of £5 billion extra income for all corporates across the UK.

Donald Brydon, chairman of the London Stock Exchange stated that optimising talents should be a priority for any organisation. Studies show that once in an executive position, women tended to hire other women, and as such steps could be taken to ensure that strong female role models would be in place to help more junior women.

The Pipeline went on to suggest that companies take time to invest in leadership development for women, and in this CEO’s should be seen to take the lead. When the CEO ‘owns the issue’ and communicates the importance of the subject, then significant change will take place.

The Pipeline recommends that companies set their targets publicly, they reward progress, and champion programmes to address gender imbalances. By recognising, and working through reasons for an unconscious risk aversion to promoting women, companies will go on to benefit from better performance and increased net income.


Go Back to Previous Page