Women are being appointed to board levels in FTSE 100 companies for ‘symbolic value’ as they serve a shorter tenure than their male counterparts.
These findings came to light from the Female FTSE Board Report produced by Cranfield University’s School of Management. On average, non-executive female directors serve nearly four years (3.8) years compared to five years served by men.
Only 11 per cent of women on boards are from Black, Asian and minority ethnic (BAME) backgrounds. This is despite the fact that the percentage of women on FTSE 100 boards is on track to reach 33 per cent by 2020.
This is why Cranfield wanted to look ‘beyond the numbers’ to identify the true diversity of FTSE boards.
Sue Vinnicombe, professor of women and leadership at Cranfield University, and lead author of the report, said:
Since we started our report more than two decades ago, we have seen the number of women on boards increase from 6.7 percent to 32 percent. There has clearly been great progress on the numbers front but scratch beneath the surface and we suggest that some companies have simply been ticking a box.
There is mounting evidence that women have shorter tenures and are less likely to be promoted into senior roles than their male counterparts. The number of women in Chair roles has decreased this year. We need urgent action to make sure that women are being appointed to boards on and recognised for their contribution, and not simply for symbolic value.
Stephen Haddrill, Chief Executive of the Financial Reporting Council, said:
While I welcome positive progress at some of the UK’s largest companies in appointing more women to board level roles, it is clear more needs to be done to promote diversity across all levels of FTSE companies. Current efforts need to be reinforced.
There have been increases but Cranfield seems to hold the opinion that a lot more needs to be done. Women on boards in FTSE 100 companies have increased from 29 per cent to 32 per cent, whilst non-executive directors (NEDs) are at an all time high of 38.9 per cent. Still, the amount of female executives is low at 10.9 per cent.
Charlie Grubb, managing director at Robert Half, a specialist recruitment consultancy said:
The rise in the percentage of female executive directors and the number of women on boards points towards the changing make-up of the executive ranks of FTSE companies.
Businesses who are successful at boosting boardroom diversity focus on building a talent pipeline with a wide range of views, experiences and backgrounds, as well as on setting long-term diversity goals to achieve a more efficient and inclusive workplace
The Female FTSE Board Report has been monitoring trends in women’s representation on FTSE 350 boards since 1998.