Women on Boards 2015: “A revolution in boardrooms of FTSE companies”

It is four years since Lord Davies published his “Women on Boards” review, setting out recommendations aimed at increasing the number of women on listed company boards. March 2015 saw the publication of the latest annual review of progress made on those recommendations.

The position in 2011

In 2010/11 women made up only 12.5% of the boards of FTSE 100 companies. Lord Davies set a target of a minimum of 25% female representation by 2015, with an expectation that that percentage would be higher. This target-based, rather than quota-based, strategy gave businesses the opportunity to assess and improve their board’s gender balance according to a number of considerations, including their starting position, their domestic legal system and their own business environment. Lord Davies and his steering group continue to advocate this strategy, notwithstanding the proposed EU Directive on improving the gender balance in company boardrooms. That Directive, which is proceeding through the EU legislative process and remains subject to change, proposes to introduce a quota obligation, which it describes as a “quantitative objective”, on listed companies of at least 40% gender representation among non-executive directors by 2020.

How we stand today

Over the last four years significant progress has been made. Female representation on FTSE 100 boards now stands at 23.5%. The figures for the FTSE 250 are, in terms of proportionate increase, even better, with the representation of women over this period more than doubling to 18% (from 7.8% in 2011).

There are now no all-male boards in the FTSE 100, a milestone event in the history of the London Stock Exchange. In 2011 there were 131 all-male boards in the FTSE 250; now there are just 23. There are 41 companies in the FTSE 100 with 25% or better representation of women on their boards, with Diageo and Intercontinental Hotels Group (both with 45.5%), Admiral Group (41.7%) and Capita (40%) leading the way. For the FTSE 250, Electra Private Equity (50%) and Alliance Trust, JD Wetherspoon and Redrow (each with 42.9%) have the highest percentage of female board representation.

The future

Lord Davies and the Steering Group remain committed to a voluntary, target based approach. There are still only relatively small numbers of female executive directors, chairpersons (there are only three female chairpersons in the FTSE 100 and eight in the FTSE 250) and senior independent directors being appointed and, despite the encouraging figures above, the appointment rate of women to FTSE 250 boards slowed in the last 12 months. Lord Davies’ next review will reflect on how to sustain the progress achieved so far and how to build on this, including the important issue of increasing the pipeline of female executive directors.
Read the full Women on Boards 2015 report here.