Over half of employers reject mandatory quotas for women on boards

The Women on Boards review published by Lord Davies in February 2011 looked at the obstacles that prevent many women from reaching senior positions in business, such as FTSE 350 corporate boards; and set a target of 25 per cent of board positions being held by women by 2015. As the anniversary of the report approaches, new research by the CIPD, business leaders and Business and Women & Equalities Minister Jo Swinson MP, has revealed resistance to the idea of mandatory female quotas as mooted by some EU members, with over half those polled suggesting that the government should instead set a more ambitious voluntary target to improve gender diversity in boardrooms post-2015. Two thirds of respondents said that an open and supportive culture that encourages gender diversity would be a more effective way of improving gender diversity at board level.

Gender Diversity in the Boardroom: Reach for the top, explores perspectives on female representation as well as practical strategies for improving gender diversity at the top of organisations. It found that a clear majority of businesses surveyed (60%) were against mandatory boardroom quotas and think that voluntary targets, greater initiative awareness, workforce monitoring and building sustainable strategies are the most effective ways to improve long term gender diversity, both in the boardroom and beyond.

The CIPD urging more businesses to improve visibility of women in both executive and non-executive roles and calling for businesses to adopt a separate voluntary target of at least 20 percent female executive directors among FTSE 100 firms by 2020.

The main findings of the report include:

• 60 percent of respondents are against mandatory quotas and 53 percent suggested that the government should set a more ambitious voluntary target to improve gender diversity in boardrooms post-2015. When asked what this target should be, a voluntary target of 50 percent was the most popular choice.
• Just under half (49%) of organisations monitor the gender profile of their workforce at all levels, including senior and board roles. More than a quarter (28%) do not monitor the gender profile of their workforce at all
• 89 percent of respondents think that a good level of gender diversity can improve boardroom effectiveness.
• 50 percent would like to see a separate target to help increase the proportion of women in executive director positions, with 38 percent disagreeing and 12 percent unsure.
• 64 percent of respondents said that an open and supportive culture that encourages gender diversity is the most effective way of improving gender diversity at board level. Second most important was unbiased recruitment and selection practices to attract diverse talent pools (cited by 56%).
• Over half (56%) of respondents are aware of the Lord Davies Review, however, a sizeable proportion (44%) are not. Just 17 percent of survey respondents are aware of the ‘Think, Act, Report’ initiative.

Dianah Worman OBE, Diversity Adviser at the CIPD, said: “There has been progress which can be seen in the rising percentage of women on boards over the last few years towards the Lord Davies target and that should be recognised. However, the gains in the main have been made in non-executive positions whereas the numbers for women in the top spot executive positions and visible to the wider organisation still only accounts for 8.4 percent.

“Seeing is believing and that’s why our specific call to Government is to have a separate voluntary target of at least 20 percent for female executive directors on the boards of FTSE 100 boards by 2020 so we can have a true goal and measure for progression right at the top.

“Boardroom diversity is not a numbers game and not just about women. It is also not just about the boardroom, but rather understanding and monitoring the entire workforce in order to create clear talent pipelines which allow women to reach the top.

“Organisations need to be receptive to this and aware of initiatives such as ‘Think, Act, Report’ in order to encourage more women to progress to these positions. We hope the doors that have helped to increase female representation thus far will stay open for broader diversity in the workforce.”