Having finally read through Lord Davies’ “Women-on-Boards” report, http://www.bis.gov.uk/assets/biscore/business-law/docs/w/11-745-women-on-boards.pdf, it was good to see that Lord Davies did not advocate specific percentage quotas but recommended that UK listed companies in the FTSE 100 should be aiming for a minimum of 25% female board member representation by 2015 and that FTSE 350 companies should be setting their own, challenging targets and expects that many will achieve a much higher figure than this minimum. This has been in line with previous articles where I have provided commentary on this issue, that ascension of women should be upon merit and certainly not due to an imposition placed upon a company.
The report also recommends:
Investors should pay close attention to the recommendations from the report when considering re-appointments to a company board.
Companies should periodically advertise non-executive board positions to encourage greater diversity in applications. Non-executive roles are generally filled on a nepotistic basis and whilst there are women acting as non-executive directors on certain FTSE companies, the application process has never been fully transparent before.
Headhunting firms should draw up a voluntary code of practice addressing gender diversity in relation to board level appointments to FTSE 350 companies.
The Financial Reporting Council to amend the UK Corporate Governance Code to require listed companies to establish a policy concerning boardroom diversity. This should include how they would implement such a policy, and disclose annually a summary the progress made.
Furthermore, as part of the report Lord Davies and his panel state that companies should fully disclose the number of women sitting on their boards and working in their organisations as a whole, to drive up the numbers of women with top jobs in business. This is an interesting and meaningful condition. Studies have shown that people need role models to set a standard of achievement. In specifying this condition, women will be able to assess and be able to measure the ascension of colleagues in an organisation.
The reactions of many organisations to this report has been incredibly positive although there have also been searching questions as to how women would be able to cope with the ascension to the boardroom with family commitments, namely by certain females in senior positions. Family commitments have perhaps always been a factor as to why there are so fewer women than men in senior positions, but with the recommendations set forth in Lord Davies’ report, it is surely time for companies to consider this as factor in their diversity policies and ascertain how they can ensure a multifaceted boardroom, recognising that women are the child bearers and mainly the child carers and no longer relying on the “old boys network” to fill positions in the higher echelons.
Linda Spedding and Sharon Benning-Prince endeavour to assist women in understanding their skills and talents and through womeninlaw UK (www.womeninlaw.com) and international (www.womeninlawinternational.com) provide various network systems to assist women in balancing their work-life needs and attaining their objectives.
7 March 2011