Headhunters are urged to increase the number of women sitting on the boards of Britain's biggest companies. Currently, only 20% of FTSE 100 board members are female, and there are only four CEOs among the UK's biggest 100 companies.
Charlotte Sweeney is a leading diversity expert. Here, she explains why more needs to be done to help women reach the top.
Since the launch of Lord Davies' original report in 2011 there has been a step change in the perception and commitment of gaining more diversity on FTSE 350 boards. The business case for increasing the number of women on corporate boards has been widely articulated.
In January 2014 women accounted for 20.4% of corporate board members of FTSE 100 companies and 15.1% of the FTSE 250. The target of 25% by 2015 is within our grasp; however, we cannot be complacent and assume further progress will be made without further considered focus.
In September 2013 I was asked to conduct an independent review to test the integrity of the code and to ensure that it continues to have a positive impact upon the board recruitment process. I was also asked to review the requirement for women to make up 30% of long lists and explore the number of women successfully reaching the short lists.
My review involved a range of stakeholders including interviewing chairmen, board consultants, female directors, investors, HR Directors and other interested parties to form a true picture of progress made and adherence to the code as well as sharing examples of good and effective practice.
The Voluntary Code for Executive Search Firms was originally created to ensure executive search firms were supporting FTSE 350 companies to create more diverse boards and covered the relevant search criteria and processes. The code has played its part in continuing to progress the appointment of women into board positions, many contributors to this review have highlighted the positive impact it has had on discussing the role brief, identifying women who have the skills and competencies to take a board position, supporting them through the process and promoting good practice.
However, there were also examples where some search firms were not delivering to the requirements of the voluntary code and it was surprising to discover that only 25% of the signatories are actively promoting their involvement via their website or other marketing materials. Furthermore, it was clear from some of the information gathered that not all search firm employees were aware of the code let alone their company's involvement. Only 12% of signatories actively share the impact of their actions by sharing information on the representation of women on their long-lists and how this progresses to securing an appointment. As this is one of the more visible requirements of the code one can only assume that delivery towards the other provisions is mixed.
If you compare where we are now to where we were in 2011 we have made progress but there is more to be done. As with any change, the provisions within the code should now be considered as the 'new normal' with the performance bar being raised, just as it should for all stakeholders involved in creating more diverse boards.
I created the ten recommendations within the report with the above in mind. The Search Industry plays a crucial role in supporting FTSE 350 companies to create diverse boards; however, they are part, not all, of the solution. The recommendations are directed at the majority of stakeholders in some way, ranging from search firms capturing information on their hiring process and sharing their statistics with Government, companies including a statement in all their search contracts articulating compliance to the voluntary code, to supporting investors with appropriate information to play a more active role on this agenda and challenge businesses further on their plans.
The recommendations have been designed to support delivery towards the 2015 target originally stipulated in the Lord Davis Review. Each play their part towards achieving the target but will not be as impactful if delivered in isolation. The target date is a matter of months away and although current energies are focused on reaching the imminent target we should also consider the sustainability of actions taken to date and the cultural shift seen over recent years. A true measure of success will be the continued positive trend of creating more diverse boards in the FTSE 350, long past 2015.
The opinions of Charlotte Sweeney do not necessarily reflect those of ITV News London.