Government announces five-year review to increase women on FTSE boards

New plans follow the success of the Hampton Alexander review, but experts say more needs to be done to properly address gender inequality

The government has announced plans for ​​a new five-year review aimed at increasing opportunities for women on boards of the UK’s top listed companies.

While details are still scarce, some experts have suggested the new review could focus on the roles women hold on FTSE boards, and aim to boost the number of executive director positions occupied by women.

The government has said there will be new targets, and the review is already welcoming submissions of gender diversity data from FTSE firms.

The FTSE Women Leaders Review, announced yesterday (1 November) by the Department for Business, Energy and Industrial Strategy (BEIS), is the successor to the Hampton Alexander review, which ran from 2015 to 2020 and was widely regarded as a success.

The Hampton Alexander review met its main target of having a third of all FTSE 350 board positions held by women, with the FTSE 100 reaching 36.2 per cent, and the FTSE 250 reaching 33.2 per cent female representation.

Together, this marked a 50 per cent increase in the number of women on FTSE boards over five years, while the number of ‘one and done’ boards with only one female member also decreased from 116 in 2015 to just 16 earlier this year.

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While the focus of the Hampton Alexander review was the number of women in board-level positions, Simon Kerr-Davis, employment counsel at Linklaters, suggested the new review might consider the roles occupied by women on boards.  

“While non-executives can exert a powerful influence on decision-making, a focus on the gender diversity of executive roles would be a significant step towards promoting true inclusivity,” he explained, suggesting that this would make businesses consider their internal pipeline towards executive board roles more carefully and ensure inclusivity is factored in across the company.

However, he warned that any decision to increase the targets for female representation would “split opinion with likely complaints both that it still does not represent parity and that it is an unattainably high target”.

Felicia Willow, chief executive of The Fawcett Society, said the announcement of a successor review was a “step in the right direction”, but that the setting of targets for women’s representation must sit within a wider system of support.

This would also need to include flexible working for all, as well as enhanced childcare, which would go “hand in hand” with strengthened gender pay gap reporting. 

“Improving gender equality is good for business and employers should take action now to close their gender pay gap and offer all jobs as flexible by default,” she explained.

Business minister Paul Scully said businesses in the UK had made “great strides” in improving gender diversity at board level, and urged firms not to “take their foot off the gas”.

“Evidence shows that more diverse businesses are more successful businesses,” he explained, adding that “the case is too strong to ignore”.

The FTSE Women Leaders Review Portal is open for all FTSE 350 companies until Tuesday 30 November 2021. The next annual report will be published in February 2022.