Board-level diversity isn't so hard to achieve, says Frances Dickens, CEO of Astus Group. Recent moves by Twitter, Pinterest and Aviva show that senior executives can see they have everything to gain
It's always great to see how progressive some companies can be in their HR policies. They prove that, for all the blinkered corporate executives out there, there are some organisations that are proudly making proactive strides towards improving the diversity of their boards of directors. Highlighting these examples is really important as it demonstrates that companies are starting to get the message that corporate decision-making – and profits – are only improved when you embrace difference, especially on the executive board. This is so far beyond being a 'women's issue'.
So three cheers for Aviva, Twitter and Pinterest. The latter two have just appointed women to their boards. Pinterest has brought in former Amazon exec Michelle Wilson as its first female director, joining founder Ben Silbermann and two male investors. Meanwhile, Twitter has appointed two more female non-execs to its board: Martha Lane Fox, government digital luminary and founder of Lastminute.com, and Debra Lee, the chairman and CEO of BET. They’ll be working alongside another female veteran of the UK media scene: ex-Pearson CEO Marjorie Scardino. Twitter’s board now boasts four male and three female non-execs.
The Twitter move is particularly relevant as Twitter has been struggling with allegations that it hasn't moved fast enough to tackle misogynist abuse on its platform. Lane Fox's appointment is a nod to the fact that the company is aware that broadening the diversity of its management should help its responses to both issues. Twitter's executive chairman Omid Kordestani has acknowledged the need and promised more action to mix up the experience of its directors.
These appointments are also well worth flagging as this is a sector that, despite being so young, is also predominantly run by men. Research from Lane Fox's campaigning group, Doteveryone, has found that only 17% of jobs in the UK tech industry are held by women and less than one in ten of these women are in leadership positions.
Financial services is another industry that has historically kept to a uniformly pale male line-up on its boards of directors. So there was good news late last month that Aviva has become the first FTSE100 company to sign up to the 30 Per Cent Club's newest challenge: to guarantee that 30% of its executive board are women. In fact, Aviva has already hit this goal – four of its 12-strong group executive team are female.
The 30 Per Cent Club is a fantastic organisation that campaigns for – funnily enough – 30% representation by women on boards of the FTSE100. It launched six years ago and has been one of the driving forces that has helped the proportion of women on boards rise from 12.5% to 26%. This year it refined its targets when it became clear that it is important to ensure the diversity of executive – not just non-executive – boards, as well as focus on companies outside the FTSE 100. Its new target is to see 30% of the boards of FTSE 350 companies comprised by women by 2020, as well as 30% of the exec boards of the FTSE 100.
Although I'm not a fan of quotas as I feel they can be patronising and counter-productive, the 30 Per Cent's policy of setting targets that companies can choose to meet is a good one. Much more effective to praise a positive move like Aviva's and more likely to encourage other companies to follow suit.
Aviva's move came hard on the heels of another diversity initiative in the financial services industry. HM Treasury's Women in Finance Charter emerged a couple of months ago as a result of an enquiry led by Jayne Anne Gadhia, CEO of Virgin Money, looking at the barriers to female leadership in this sector. Companies signing up to the charter are asked to agree to make four pledges: to make one person on the senior exec team responsible for gender diversity; to set internal targets for gender diversity in senior management; to annually publish progress towards these targets; and to link pay of the exec team to the achievement of these goals.
Joining Virgin as the founder of this charter were Lloyds, Barclays, RBS and HSBC, along with Columbia Threadneedle and Capital Credit Union. This is all particularly gratifying to see as financial services is currently the business sector that has the widest gender pay gap.
Finally, I was glad to hear that the Federation for Small Business (FSB) plans to create a taskforce to support female entrepreneurs following the publication of a report that makes clear the particular challenges that seem to be more of a difficulty for women than men when running businesses. No surprises perhaps that the old chestnut of balancing work and family demands was cited by 40% of female entrepreneurs as a challenge. But these women also said that achieving credibility for their business (37%) and a lack of confidence (22%) was also holding them back. The FSB’s taskforce will help address these issues.
It's really beginning to feel as if momentum is building on corporate diversity. Let's hope that other companies can be encouraged by these examples and begin to explore how they can benefit from bringing in a greater mix of directors.