November saw the release of the Hampton-Alexander Review 2018, which is a review of FTSE 350 boardrooms and senior leadership teams, by the government. This annual report keeps an eye on the UK’s largest listed companies as regards the gender split within senior management and the board.
It is terrific to see the progress made since 2011, when Lord Davies first reviewed the number of women on FTSE 100 boards. At that time only 12% of FTSE 100 board seats were filled by women.
Today the position is very different: the UK’s top 100 listed companies now have 30% female representation in the boardroom and the FTSE 250 has 25%.
However, quotas may still be needed unless the UK government gets its act together and rolls out this type of data collection to companies that employ more than 250 people.
Australia collects this data on companies that employ more than 100 people already. California requires all publicly traded companies with headquarters in California to have one woman on their board by the end of 2019, and two by the end of 2021.
We need to see a step change in attitudes, because outside the FTSE 350 there is limited progress being made (with less than 15% women on boards), and within the top 350 listed companies, progress remains glacially slow.
As much as I like seeing women in the boardroom, it is not the boardroom that runs the day-to-day operations. We urgently need board committees to increase their remit to measure, manage and engage with C-suite executives to ensure that equal opportunity is a reality within their companies.
Research has clearly demonstrated that inclusive and diverse environments are more innovative, use capital more efficiently and make better risk-adjusted decisions. This in turn leads to better returns for shareholders and stakeholders.
According to Anthony Hilton in the London Evening Standard recently: “The UK may not be the worst EU country for women in senior roles but is second from bottom. Indonesia and Jamaica are the high fliers.”
Empower and engage
With Brexit now upon us it is vital that board directors across the UK ensure that all staff are empowered and engaged in the best way possible. This is a pivotal moment for directors, who are still predominantly male. It is time to step up and ensure that executive and senior managers become better listeners, so that the UK grasps all the opportunities which hopefully will present themselves over the coming years.
Good companies understand that people have multiple unconscious biases, and that unconscious bias training achieves nothing apart from explaining why new processes and procedures are being put into place. The board should ensure that executive teams have in place measures to ensure that talented individuals within their company have equal access to stretch jobs, training and the support they need to access closed networks, to enable success.
Leadership training across UK companies is pitifully rare and tends to focus on “fast fixes”—things like presentation skills courses, rather than helping people understand how to engage hearts and minds to improve performance and time delivery.
Listed companies should also, I believe, openly advertise board vacancies, on a “comply or explain” basis. The excuses for not recruiting women to the boardroom and below, as outlined in the Hampton-Alexander report, are both sad and hilarious.
On our database alone, we have 7,000 women who have the strategic, financial and governance oversight knowledge to step up onto boards, all of whom are actively looking for positions. People you might not know but who could bring to your board new perspectives.
I don’t like quotas, but I do like what they achieve. Persuasion is preferable to the quota route, but it only works when someone with power is measuring and managing. No-one in the UK, at government level, is persuading and managing companies outside the FTSE 350, so it is time that boards step up and take on the challenge to avoid quotas.
Fiona Hathorn is managing director of Women on Boards in the UK, Peel Hunt adviser and a patron of the medical research charity Fight for Sight.
Women on Boards UK is an action-oriented social enterprise supporting women, and some men, to leverage their professional skills and experience into non-executive director and other board-level roles.