Women on boards: why progress towards diversity is dividing opinion

The headway we’ve made in bringing greater boardroom diversity has been bittersweet – but Frances Dickens, CEO and co-founder of Astus Group, believes there is plenty to be positive about

Women on boards: why progress towards diversity is dividing opinion

Recent UK headlines about women on boards show that reaction to this issue tends to see-saw, tipping between angst and applause. On the one hand, we’re congratulating ourselves that women have gone from occupying 12.5% of FTSE 100 boards to 25%, meeting the targets set by the Davies Review; the next we’re – understandably – bemoaning the fact that there are still only five women chief executives in the FTSE 100. So why are there such divergent feelings about this? Aren’t we making progress?

Well yes and no. The good news is threefold:

First, there is genuine momentum around the need for greater gender boardroom diversity. This is partly thanks to changes to the rules surrounding corporate governance that were recommended in the Davies Review. Publicly listed companies are now required to be far more transparent about the number of women on their boards and in senior management positions, as well as their overall policy on board diversity.

Secondly, there is a greater demand amongst politicians, the media and shareholders that big companies should be held to account regarding boardroom diversity. We saw this last year with mining company Glencore, the last FTSE 100 company to appoint a woman to its board, which faced massive pressure before appointing mining executive Patrice Merrin as a non-executive director.

Thirdly, the rise of women on boards in the UK to date has been achieved without having to resort to mandatory quotas, which is very much a positive thing. There are a number of research studies that demonstrate that companies with more diversified boardrooms perform better than those without. Credit Suisse research that looked at the performance of more than 2,000 large cap companies found that companies with women on their boards had higher average returns on equity and better average growth than those without. As a result, rather than supporting statutory quotas, I believe those of us who support increased boardroom diversity should be talking up the tangible business benefits it offers.

So clearly we’ve made some headway. But the bad news about what we’ve achieved so far is that we started from a low base and – in our increasingly fast-paced, want-it-now world – our current rate of progress seems painfully slow.

What’s more, most appointments of women to boards have been to non-exec roles rather than executive positions. Unlike executive directors, non-execs are not employees; they can guide and advise but don’t influence day-to-day decisions or long-term business strategy and direction. Just 9.5% of FTSE 100 female board members are executive directors and the figure drops to 5% for the FTSE 250. Similarly, there are only five female chief executives in the FTSE 100 – the same number as in 2010/11. It’s small wonder that the rise in female non-exec appointments to FTSE 100 boards has been criticised as “window dressing”.   

So what’s to be done? There are three actions we should take: 

Manage expectations

In order to maintain momentum and interest in the issue of women on boards, we have to manage expectations. To borrow from Winston Churchill’s famous line, this is “the end of the beginning”. When it comes to achieving greater boardroom diversity, we are talking about a long-term campaign designed to deliver meaningful change. It isn’t going to happen overnight. But managing expectations about the scale of this task does not preclude an ambitious timetable for change; well-publicised targets can be set for women on boards, against which recalcitrant companies can be held to account.

Make it political

The Davies Review has shown that government is well placed to create the framework for voluntary change, monitor and report on progress and – where necessary – intervene directly. Were it not for Vince Cable’s censure of Glencore, it may have taken the business far longer to act. David Cameron’s recent commitment to forcing companies with 250 employees or more to disclose their gender pay gap is another example of positive government intervention.

Make it meaningful

Because there is still a long way to go in our campaign to change the composition of Britain’s boardrooms, it would be easy to become fixated with quick wins. But 25% of women on boards is not as impressive as 25% of women in executive positions on boards. What’s more, as the BNY Mellon report highlights, we need to focus not just on getting women on boards but on longevity – making sure they stay.

Empowering women and girls outside the boardroom will be the key to winning the long game. And there are a lot of great initiatives aimed at doing just that. For example, the 30% Club is committed to achieving 30% representation of women on boards by the end of this year – as well as to improving the pipeline of young female talent from ‘schoolroom to boardroom’.  


So on which side of the see-saw do I sit? Ultimately, I recognise achieving 50:50 gender diversity on boards is a huge task. However, this issue is now centre stage within the world’s biggest economies so I’m optimistic we will get there. 

Frances Dickens
Frances Dickens

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