Diversity in corporate life, by bringing balance to British boardrooms, will benefit the wider economy, says Lisa Buckingham
There’s nothing like a deadline to spark a flurry of action. And, as I write my first column for Director, I am acutely aware that there is only a year to go before the boardroom diversity targets recommended by Lord Davies of Abersoch should be met.
Whether you agree with them or not, it is clear that falling short could precipitate some heavy-handed intervention even though the government has, for now, pulled back from the threat of quotas.
The Davies recommendations set out in 2011 require that women should make up 25 per cent of boards in the country’s largest companies by 2015. Latest figures show movement towards those targets: in the FTSE100 women account for 20 per cent of directorships while in the FTSE250 the figure is roughly 15 per cent.
It is progress – of sorts. But beneath the headline gains are some worryingly stubborn realities. And it is these that the IoD hopes to challenge with our renewed diversity policy. For while the FTSE100 overall percentages appear to be improving, this is almost solely at the non-executive – non-decision making – levels. Fewer than seven per cent of these FTSE100 positions are executive. There are only two FTSE100 boards with a female chair. And at least two FTSE100 firms have no women in the boardroom at all.
Some companies are fully signed up to the diversity agenda and are moving rapidly, others hope to get away with appointing a non-executive and thereby ticking the diversity box while others simply plough on regardless.
The playing field may be slightly more even – but it still has some very big bumps. What concerns me is that unless more women are appointed to executive positions the gene pool from which large companies fish for their non-executives will increase too slowly for a transformation to take place in our boardrooms. And while the focus tends to be on large organisations, diversity is also an issue that will face smaller businesses – even if we avoid the tide of quotas now threatening from Europe.
Smaller companies, too, need to be reaching out for and retaining the best talent across the entire UK workforce, rather than letting highly trained women disappear after the birth of a first child. The brightest school and university leavers are no longer happy to join firms where everyone at the top can be stereotyped as “male, pale and stale”.
At the IoD, we believe passionately that the quality of corporate Britain and the health of the economy will benefit from better-balanced boardrooms. That’s why we plan a series of initiatives to help companies of all sizes recruit and retain the best. We want to encourage more participation from our women members, and to tell government of your concerns on how to achieve diversity at the senior levels of businesses.