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R M Vishakha, an insurance industry veteran with more than 25 years’ experience, was appointed last year to head Legal & General’s Indian joint venture, IndiaFirst. She nearly did not make it. 

After being on the longlist, Ms Vishakha was left off the initial shortlist, and reinstated only after executives from L&G’s London headquarters complained about the lack of female candidates. Ms Vishakha was then given the opportunity to wow the appointment board during her interview. 

It is a story that “illustrates the whole ethos around our move to change our hiring practices”, says Lesley Martin, L&G’s head of diversity and inclusion. As part of its aim to increase the number of senior women from 35 per cent to 40 per cent by the end of 2017 and to parity by 2020, the investment and insurance group insists there is a woman on every senior appointment shortlist.

All aboard: RM Vishakha (left) and Lesley Martin (right) © Richard Boll/Getty Images

“It’s not about positive discrimination, it is about the getting the widest possible talent pool and a different perspective,” Ms Martin says.

Policies like these are still needed more than 45 years after the UK’s Equal Pay Act came in, which was designed to ensure equality in the workplace and prevent discrimination, particularly on pay. Despite a surfeit of charters, targets and reports, female executives are still an uncommon sight in boardrooms.

Fewer than 10 per cent of executive director roles at the UK’s 100 biggest public companies are held by women, according to Cranfield School of Management. The number of women in executive director roles has increased only modestly in the past five years, even while the overall proportion of female directors has risen from 15 per cent of board seats in 2012 to 26 per cent today.

Improving representation in the executive layer — both in the boardroom and among other senior leadership roles — is now the main focus of the government-backed Women on Boards commission.

The new head of the commission, Sir Philip Hampton, told the Financial Times this year that he was determined to “kick-start” the initiative after data suggested progress had stalled.

But for every company that is already going beyond national targets, there are others where it is clear — even if they are not prepared to say so publicly — that they are not yet convinced of the argument that diverse leadership teams bring business benefits.

When the UK’s Equality and Human Rights Commission surveyed top corporations anonymously this year, it found that while three-quarters had board diversity policies, around two-thirds of these did not have any targets or objectives. One anonymous FTSE 250 company, which has no women on its board, told the EHRC: “The company’s policy is to make appointments on merit and for this reason the setting of specific, measurable targets is not considered to be appropriate.”

This belief that targets and merit-based hiring are incompatible is a source of exasperation for many campaigners. Simon Collins, chairman of professional services group KPMG, which along with the government sponsors the annual Female FTSE Board Report, said at the launch of this year’s study that the push for more diverse senior teams “isn’t a moral crusade”.

“I have no doubt that including a more diverse mix of experience and opinion within our leadership team and throughout our organisation will make us a more profitable, as well as a more responsible, business,” he said. 

That is the attitude of retail group Kingfisher, parent company of home improvements retailer B&Q. It has one of the most gender-balanced senior leadership teams in the FTSE 100, with women holding four board seats out of the nine in total, and half of the positions on the group executive committee.

Its chief financial officer, Karen Witts, stresses that finding the best person for the job regardless of gender is always the priority. But the company also recognised that women account for around half of its customers and make about three-quarters of home improvement decisions. As such it is vital for the company to “develop a management team and a pipeline of talent that reflects the way our customers live and shop,” she says. 

Kingfisher operates a formal leadership programme aimed at men and women. It also runs an informal women’s network, which offers support for female managers, with the help of exec and non-exec directors. 

Ms Witts says the company has done “pretty well” in ensuring a more balanced executive team, but adds: “We know there is more that we can do to bring more women through all the way from the shop floor to the most senior roles.”

While the likes of KPMG, Kingfisher and L&G are making progress, those British companies that have no interest in change have seen one potential threat removed after the UK’s vote to leave the EU. The possibility of formal gender quotas has been much discussed in recent years in Brussels. But Brexit would mean any action would now be unlikely to affect British companies. 

Domestically, the Conservative government has been clear it has no appetite for introducing legislative targets. In a letter to the FT in August, Greg Clark, the new UK business secretary, wrote that while the “whole government” was behind efforts to increase female representation, “government alone cannot force a change in corporate culture; this must be business-led”. It would therefore be no surprise if the gap between the most and least gender-balanced companies were to widen further. 

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