June 13, 2013
Gender equality at senior management and Board level has been and is likely to remain an area of contention. According to recent research by analysts BoardEx into gender inequality in Britain’s top 100 private companies, 73 per cent of companies still have all male teams of executive directors, 51 per cent have only male non-executive directors and there are still 56 per cent of all male Boards. At the end of May a new National Equality Standard was launched by the CBI and the Equality and Human Rights Commission in response to the continued concerns about the issue, which some EU members have argued requires the imposition of mandatory board quotas.
The UK has preferred a voluntary scheme. In 2011 Lord Davies produced a report ‘’Women on Boards’’, on senior management gender inequalities and methods to voluntarily address the imbalance. The second annual progress report on the Davies Report was published in April 2013 and found that women now account for 17.3 per cent of FTSE 100 and 13.2 per cent of FTSE 250 Board directors (as at 1 March 2013), up from 10.5 per cent and 6.7 per cent respectively in 2010.
Now the EC is pushing to implement an EU Directive requiring at least 40 per cent female non-executive director participation for all listed companies. The UK Government is resisting the imposition of such a prescriptive approach. However in Norway, which legislated in 2003 for publicly listed companies to have at least 40 per cent female Board members by 2008, the representation is now 44 per cent.
Vince Cable, Business Secretary acknowledges that while some progress has been made in the UK in the last three years: ”the momentum appears to be slowing and there has been much less progress in executive appointments at the top – businesses should be aware that quotas are still a real possibility”.
However, it is not just about statistics. The 30 per cent Club, which promotes engagement of more women at senior management and Board level, identifies that to increase the number of women at senior level requires support for women throughout their careers.
Helena Morrisey, CEO of Newton and Founder of the 30 per cent Club points out that in Norway just 3 per cent of chief executives are women, and the expected effect of women progressing through their careers to fill the top jobs has “not materialised”. The 30 per cent Club believes there is a need to improve opportunities for females below Board level so that a wider talent pool is available to progress further.
Maria Miller, Minister for Women and Equalities also confirms this in her comments on the 2013 Davies Progress Report “The priority now is to maintain momentum, not only within listed companies but across the economy as a whole. Our equalities agenda isn’t solely about women in the Boardroom. It’s also about unlocking the untapped potential of women at all levels in the workforce, getting more women into work, priming the talent pipeline and bringing sustained benefit to the British economy in the longer term”.
It would appear therefore that much more work needs to be done on encouraging and supporting women not only at the senior levels but throughout their careers before we will achieve further improvements in equality without quotas being imposed.
Founder of Loch Associates, Pam Loch is a dual qualified lawyer acting for employers and employees and advising on all aspects of employment law. She is Managing Partner of niche employment law practice, Loch Associates Employment Lawyers and Managing Director of HR Advise Me Limited.