Lord Davies of Abersoch, who is chairing an investigation into the male dominance of UK boardrooms, has ruled out such a measure ahead of his final report due out this month, it was reported in the weekend papers. Instead, companies will be urged to do more on a voluntary basis to attract more women into top roles, with the threat of enforcement if progress is not made in the next two years.
Several European countries, including Norway, France and Spain, have successfully imposed quotas success and the European Commission is also considering the imposition of mandatory targets. But business groups have firmly resisted pressure for such an approach in the UK. The Institute of Directors has described quotas for women as “demeaning” while the CBI is also opposed.
“There needs to be some positive encouragement for women, but quotas don’t necessarily lead to the right answer,” said Angela Knight, chief executive of the British Bankers’ Association, yesterday.
Davies’s report, which attracted 2,600 submissions and is due to be published on February 24, is expected to say that updating on diversity should be as much a part of a firm’s annual reporting as corporate social responsibility.
It will also call on institutional shareholders and the Financial Reporting Council to pressurise companies on the issue.
Last year, FTSE 100 companies had 135 female directors out of a total of 1,076 positions, research by Cranfield University has shown.