Final report calls for greater female representation at executive level
The final part of the Lord Davies review into female representation at the top-levels of British business has recommended that a third of all boardroom seats should be held by women by 2020.
The report said the 33 per cent target should be expanded beyond the FTSE100 to include all FTSE350 companies.
Earlier this year, the UK’s largest companies met the original voluntary target of 25 per cent female FTSE100 board members by the end of 2015, but today’s report said the approach should be extended for a further five years to “ensure substantive, and sustainable improvement.”
In his final five-year review, Lord Davies, former Labour trade minister, also called for a focus on improving the representation of females at executive level, with an increase in the number of women appointed to chair, senior independent director, and executive director roles.
According to government figures, the proportion of female executive directors remains below 10 per cent, with just eight women appointed to those positions across FTSE100 companies since 2011.
Women held just 12.5 per cent of board positions in 2011. But this October females occupied 26.1 per cent of FTSE100 boardrooms, with 550 new women appointments in just over four years.
Dianah Worman, diversity adviser at the CIPD, said reaching the FTSE100 target was a “historical moment for the UK workforce” but warned that a very small number of women make up the figures, and companies could quickly lose gains without continued progress.
“The long term goal shouldn’t be anything but 50 per cent, and we’ve seen plenty of support in the HR profession for this, but it’s about the steady, effective process in which it’s achieved,” she said.
“All efforts so far towards achieving gender diversity will be for nothing if organisations don’t understand how crucial the visibility of female executive directors – those actively involved in the day-to-day decision-making and strategy creation – is to make a real, long-lasting difference.
“We’re pleased to see a focus on executive directors in Lord Davies’ long term aims, but what gets measured gets managed so we’re urging the government to introduce a separate, voluntary target for female executive directors at FTSE 100 firms of at least 20 per cent by 2020,” she added.
The Davies review said the key driver of progress had been setting “realistic, achievable” and “voluntary, business-led” targets.
Britain is currently sixth in the world for the proportion of women on company boards, behind Norway, Sweden, France, Finland, and Belgium, many of whom have introduced legislative targets.
Shainaz Firfiray, assistant professor of HR & organisation at Warwick Business School said: "When companies are coerced into appointing women on boards, there is a risk that female directors will continue to face gender-related obstacles. Very often women who are appointed to boards to meet quota requirements have claimed that they are stigmatised and it is common for their ideas to be ignored or swept aside.”
Kathryn Nawrockyi, gender equality director at BITC, added: “It is critical that employers focus their attention on challenges outside the boardroom, such as disrupting occupational segregation and closing the gender pay gap, two of the largest contributing factors to women’s under-representation and inequality in UK workplaces today.”
The Davies report recommended the creation of an independent steering body made up of business and subject matter experts to continue the progress of the yearly Davies reviews.