Female board representation is at its highest, but companies still fail to promote women

13 Mar

A year on from the Davies report, the number of women on the board has risen to 15.6%, an increase on a three-year plateau of 12%, according to the Cranfield School of Management Female FTSE report 2012: Millstone or Milestone

There are now 141 women who hold 163 FTSE 100 board seats (out of 1,086 board positions). The number of companies with no women at top levels has dropped to 11, and the number of companies with more than one woman on the board has increased to 50. Davies recommends 25% female board representation by 2015, so we are definitely on the right track. If this pace continues, 26.7% of directors could be women by 2015 and 36.9% by 2020 – exceeding targets in the Davies report, and perhaps negating the need for quotas.

Home Secretary Theresa May, who launched the report, and who is also Minister for Women and Equality, was fairly vocal on the subject of quotas, saying that she had always relied on working hard to get a job – and getting it on merit – rather than being appointed to make up the numbers.

The report shows that senior level posts are opening up to more women: of the 47 new female appointments, 29 of the women (62%) have had no prior FTSE board experience. This suggests that the recruitment and selection process is becoming more creative, according to Cranfield.

Professor Susan Vinnicombe OBE, co-author of the report said: “The past 12 months have seen a significant amount of global activity around diversifying boards. After a decade of incremental increases in the UK, we are pleased to be reporting improvements that are more substantive.  If the momentum we have seen since the Lord Davies’ review continues we could achieve 30% women on boards in less than four years, which would be a terrific achievement. We urge chairmen, chief executives, executive search firms, investors, journalists and women to stay focused and use this momentum to change the status quo permanently.”

However, when you look at the small print, it becomes apparent that there’s a wide gap between the numbers of women non-executive directors (143 women, 22.4%) compared with the numbers of female executive directors: (20 women, 6.6%).  The data also shows that while women are hired in junior and middle-management roles, but fail to reach the board.

Professor Vinnicombe added:  “From our research it is clear that many of the FTSE companies are successful at attracting women at entry level, and developing them and retaining them after maternity leave, but are still spectacularly unsuccessful at promoting them to executive level.”

The global average for women on boards has nudged above 10% – but the UK is now ahead of the US, where the proportion of women on the board is 12.6%, according to GovernanceMetrics International.

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One Response to “Female board representation is at its highest, but companies still fail to promote women”

  1. Heath D. Fagin 21/03/2012 at 7:28 pm #

    The boardroom is where strategic decisions are made, governance
    applied and risk overseen. It is therefore imperative that boards are
    made up of competent high calibre individuals who together offer a
    mix of skills, experiences and backgrounds. Board appointments must
    always be made on merit, with the best qualiied person getting the job.

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