It is cause for celebration that not only has the UK now got its second female Prime Minister, but also that FTSE 100 companies recently surpassed a voluntary target of 25% of women board members, leaving no more all-male boards in the FTSE 100.
However, there is still plenty of room for improvement according to this year’s The Female FTSE Board Report, from Cranfield School of Management, City University London and Queen Mary University London. While the percentage of women on FTSE 100 boards has increased to 26% and to 20.4% on the FTSE 250 boards this year, the rate of progress has slowed and the percentage of new appointments going to women over the past six months is the lowest since September 2011.
The story further down company hierarchies is of particular concern, as female progress in the executive pipeline remains very slow. According to the report, with female executive directorships standing at 9.7% in the FTSE 100 and 5.6% in the FTSE 250, the pipeline of female talent needs to be addressed with urgency.
The report shows how metrics and targets are effective tools for creating a disciplined approach to gender balance in organizations. It also provides case studies of organizations that use voluntary gender targets and lays out some principles of target setting.
The shortage of women in top senior roles may make it difficult for FTSE 100 companies to reach the new target of 33% female boards by 2020, set by Lord Mervyn Davies in his final report on women in the boardroom published last October.
Cranfield’s Professor Susan Vinnicombe said: “The focus on boards must be preserved as the pace of change has not kept up after the Davies closing report. In order to hit the 33% board target by 2020, chairmen and search consultants must ensure the board appointment process remains robust, transparent and gender-inclusive.”
Co-author Dr Elena Doldor, from Queen Mary University London, added: “Companies must do more to support women's careers below board level. Our research shows that rigorous gender metrics and voluntary targets are effective tools that companies can use to redress their gender balance and achieve cultural change."
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