FTSE 100 on target to reach 25% of women on boards

Labour Party

Good news from the prestigious Cranfield School of Management. Its latest research found the percentage of women on boards has now reached 22.8% – close to the 25% target set by Lord Davies for 2015.

The report said that great progress has been made since the publication of Lord Davies’ report. They found the percentage of women on the boards of the FTSE 100 and FTSE 250 had increased by 82% and 124% respectively.

While this is good news, of course, we should approach these latest figures with caution. While the last of the all-male FTSE 100 companies appointed its first woman director earlier in the year, there are still 28 from the FTSE 250 which have all male boards. In addition, the report hasn’t outlined how many of the women from the FTSE 100 and 250 are non-executive directors. Some of them will be of course and this means there input could be limited depending on how the individual company views non-executive directors. They may have a seat at the table but will they have the opportunity to voice their opinions?

Just yesterday, for example, the Independent reported that FTSE 250 miner, Petra Diamonds, finally appointed a woman to its board.
But the South African accountant and businesswoman, Octavia Matloa, will join the diamond miner as an independent non-executive director sitting on its audit committee. How much power she will have to affect change is up for debate. I hope that her seat at the table isn’t just as a result of Vince Cable’s letter to 28 FTSE 250 companies who he told to improve the diversity of their boards after it was revealed 28 companies from the FTSE 250 had no women on them.

Despite the concerns the figures from Cranfield are promising. Furthermore, the academics predict that the FTSE 100 will hit the 25% target during 2015, with the FTSE 250 following in 2016. Just 24 more women are needed in the FTSE 100 and 150 across the FTSE 250 in order to reach the target of 25%.

However, mandatory targets will be far more effective and a figure of 50% could be achieved much quicker with enforceable goals.

Women on board figures ‘slow down’ latest research reveals

Labour Party

The latest figures have been published by The Cranfield School of Management and the results show a pretty woeful picture of latest efforts to improve female representation on company boards. Despite the noises made by government and business regarding the issue of women on boards, the latest figures indicate that not only have the numbers not increased they have slowed.

The School’s research found that while in the first half of the financial year 44% of board level appointments at FTSE 100 firms went to women, just 26% were appointed by the second half of the financial year.

The Cranfield School of Management explained the results were so poor because firms had ‘become complacent about the issue.’

Not only have they become complacent but it also suggests how resistant they are to making any significant change. It is now clear that when the issue first entered the headlines businesses did nothing more than pay lip service in the hope government the media, and politicians would leave them alone and the issue would go away. But thankfully this latest and most up to date research provides us with an insight into how seriously (or not) firms are taking the issue.

As I have advocated previously, quotas for women on boards are necessary if we are to redress the balance in any way. This may not be a permanent measure but it is necessary as an immediate response.

Women still only make up 17% of board posts, well below the 25% target recommended by a government-commissioned review so something needs to be done rather than leaving it to fait alone.

The business secretary, Vince Cable, is delivering a speech today in which he will apply further pressure to leading firms to appoint women to their boards.

He has also admitted today, in his speech, that “the momentum appears to be slowing and there has been much less progress in executive appointments.”

He will write to the 27% of FTSE 250 firms with all-male boards warning them to speed up their appointment of women.

This the very minimum he can do, but what will the impact even be? Cable has said that despite these latest woeful figures he is still not inclined to introduce compulsory targets saying a voluntary led approach is still the best way forward.

The report is a timely reminder that there is a long way to go and if we don’t make any serious intervention then the situation is unlikely to improve in any significant way.