Top UK businesses are on course to meet the government’s 25% target of women on boards, according to a recent report by the Cranfield School of Management (“Cranfield Report”).
The original report was carried out by Lord Davies in February 2011. In this report he noted that women made up only 12.5% of the boards of FTSE 100 companies and 7.8% of the boards of FTSE 250 companies. He recommended a target of 25% female representation on the boards of FTSE 100 companies to be implemented by the end of 2015.
The Cranfield Report revealed that the number of women on FTSE 100 boards has now reached 22.8% and the number of women on FTSE 250 boards has reached 17.4%. The report predicted that, if the current pace of change is maintained, FTSE 100 companies will hit the 25% target during 2015, with FTSE 250 companies following in 2016.
Further to this, the Cranfield Report also revealed that there are no longer any all-male boards in the FTSE 100 and that only 28 of the FTSE 250 have all-male boards.
Although there has been considerable improvement in the number of women on the boards of top UK businesses, the lack of ethnic diversity is now also causing concern.
Business secretary, Vince Cable, recently launched the 2020 Campaign which aims for there to be no FTSE 100 company with an all-white board by 2020.
According to figures by Green Park Executive Recruitment, 62% of FTSE 100 boards are all-white. Only 5% of board members are from ethnic minorities and there is not a single person of Chinese or east-Asian origin on the board of any of the UK’s biggest companies.
Notwithstanding the current situation, Mr Cable has no plans to introduce a binding quota to increase ethnic diversity. It has been seen with the progress of the number of women on the boards of FTSE 100 companies, that a binding obligation is not strictly necessary to improve diversity.
On the current situation, Mr Cable said: “Black and ethnic minority representation on UK FTSE 100 boards is currently around 5%, which is much lower than we would expect if the company boards reflected the population of this country [around 14%]. I want us to extend the successful campaign we have led to increase female representation on FTSE 100 boards to tackle invisibility of ethnic minorities in Britain’s top companies.”
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