UK firms have been urged to double down on their efforts to meet the 40% women in leadership target by 2025.
Although around half of FTSE 350 companies (56%) have met the goal of 40% women in leadership, the other half have yet to pick up the pace, according to the latest FTSE Women Leaders Review, in the lead up to International Women’s Day.
The independent business-led initiative, backed by the Government and sponsored by Lloyds Banking Group and KPMG, noted that steady progress for gender balance at the top of British business is clearly in sight, however the job is not yet done. Women now hold 35% of all leadership roles in FTSE 350 companies, but with less than two years to go, UK businesses are urged to double down on their efforts to reach the target.
The appointment rate of women to leadership roles still leans in favour of men with more than six out of every 10 vacancies in the year being awarded to a man. To meet the 40% target for women in leadership, as well as on boards by the end of 2025 deadline, this will need to change. Over the next two years, almost every other appointment will need to go to a woman, noted the report.
STRONG SUPPLY OF TALENT
“Over the last decade we have seen near revolutionary change in the culture and dialogue at the top of British business with diversity in leadership now viewed as a business imperative that is key to long-term success,” stated Denise Wilson, CEO of the FTSE Women Leaders Review. “Whilst we have the strongest ever supply of experienced, capable women ambitious for themselves and for their organisations, the appointment rate is still skewed in favour of men. To fuel further, faster progress and deliver gender balance this will need to change.”
According to the report, there has been positive progress in the drive to have at least one of the four key decision-making roles of Chair, CEO, Senior Independent Director (SID) and Finance Director held by a woman by 2025. As women’s representation on FTSE 350 Boards goes from strength to strength, the number of women in the SID role, which plays an important part in board governance, has increased significantly from 37% to 47% year-on-year.
WOMEN IN LEADERSHIP PROGRESS
That said, despite several new appointments in the year, progress in the Chair and CEO role across the FTSE 350 has remained largely flat with marginal gains offset by losses elsewhere. There are, however, encouraging indicators of progress to come with the number of women on FTSE 100 Executive Committees reaching 30% and a welcome uplift to around a quarter of all FTSE 100 Finance Director and Chief Information Officer roles now being held by women; roles that are increasingly recognised as important career routes to CEO.
The second year of reporting for the Top 50 private companies, in which diversity expectations are aligned with those of public-listed companies, shows a good increase in the representation of women in leadership to 36%, while progress for women on boards is at 31% and has remained flat in the year.
INTERNATIONAL COMPARISONS
The transformation of British boardrooms that is well underway is borne out in the international rankings where the UK ranks second only to quota-led France and ahead of Norway cementing its reputation as a world leader for women on boards. With 350 public-listed companies and almost 3000 board seats in scope, the UK out-runs most of its international counterparts in scale and ambition with progress achieved through entirely voluntary action and commitment from business.
“Over the last year we have seen continued progress in delivering gender balance across UK companies which is testament to the commitment and determination of business leaders,” stated Penny James and Nimesh Patel, Co-Chairs of the FTSE Women Leaders Review. “Whilst the number of women in senior executive roles has increased, we now need a step-change in the rate of improvement to reach our goal of 40% women’s representation at the top of industry in the next two years. Given the cadre of talented women and the collective focus on building greater diversity of perspectives we believe that this is wholly achievable and look forward to working with businesses to deliver on our ambitions.”
Check out the full report here. And click here to listen to FTSE Women Leaders Review CEO Denise Wilson share insights into what organisations are doing to increase the number women in leadership and boards, and how the UK compares internationally on D&I Spy.
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