A record number of women on boards is failing to translate into genuine equality in senior roles, a report has found, warning of institutionalised sexism and tokenistic appointments.
The report, published by Cranfield School of Management and EY, found that despite significant progress made in the number of non-executive directors on FTSE 100 boards, this did not translate to a corresponding increase in the number or executive positions going to women, which remained “stubbornly low”.
In the FTSE 100, less than one in seven executive director roles (13.2 per cent) were held by women in June this year, with women filling just five out of 100 chief executive roles. The situation was worse in the FTSE 250, where just 11.3 per cent of executive director roles were held by women.
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Additionally, between 2019 and 2020 the percentage of FTSE 100 committees chaired by women fell from 31 per cent to 29 per cent, despite the overall number of committees increasing. And there were just eight FTSE 100 boards chaired by women in June 2020.
This is despite an overall improvement in the representation of women on boards. Women now account for a record 40.8 per cent of non-executive directors in the FTSE 100, and 37.6 per cent of non-executive directors in FTSE 250 firms.
Sue Vinnicombe, professor of women and leadership at Cranfield and lead author of the report, described the numbers of women at executive director level as “pitiful”, and told People Management this lack of representation indicated firms were making tokenistic appointments. “We’ve got all these appointments of women to boards and yet we don’t seem to give them serious jobs,” she said.
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“You've got nearly 300 women sitting on the boards of the FTSE 100 and yet only eight of them are chairs. There’s no excuse for that. We’ve now got well over 40 per cent of [non-executive directors] across the FTSE 100 who are women, and yet we’ve still only got eight women chairs. So what does that speak of?” she said. “My worry is that this is all about symbolic appointments."
Vinnicombe raised concerns that institutionalised sexism was blocking women from progressing. Businesses now have a large talent pool of experienced female non-executive directors to draw from, she said, yet “we still aren’t capable of appointing them as chairs, so there has to be something wrong with the appointment process”.
HR was “crucial” to fixing this, Vinnicombe said. People professionals should collect quality data to hold managers accountable, create the tools and training to tackle bias, and “provide the challenge and the feedback to constantly push forward,” she said.
But, she added: “We do have to be careful to put in perspective the progress we have made. We have made progress, but there is a great variance underneath that.”
Across the FTSE 100, 34.5 per cent of director seats – both executive and non-executive – were held by women, up from 32 per cent the previous year. Similarly in the FTSE 250, 31.9 per cent of board roles were held by women, up from 27.3 per cent.
But the report noted there was “quite a lot of variance” among firms. Only 63 per cent of FTSE 100 firms and 53 per cent of the FTSE 250 had reached the Hampton Alexander Review target of having 33 per cent of seats held by women.
Within the FTSE 100, Severn Trent and Taylor Wimpey had the highest proportion, with 56 per cent of their board female. Meanwhile, Bunzl had the lowest, with just 17 per cent.
The report also warned that coronavirus “[threatened] to reverse gender equality progress”, and that “the unequal burden of care placed on working women during the lockdown [would] exacerbate already existing gender inequalities and the gender pay gap”.
Arun Batra OBE, partner at EY and chief executive of the National Equality Standard, said HR teams needed to take “proactive steps” to improve representation. This included by “getting forensic with their talent lifecycle and examining how they interact with recruiters to identify talent.
“These steps will be crucial to strengthening the pipeline and getting more women into senior board roles,” said Batra.
Responding to the report’s findings, Charlotte Woodworth, gender equality campaign director at Business in the Community, said achieving the Hampton Alexander goal of 33 per cent representation would be a “hollow victory if businesses still [failed] to see the bigger picture”.
“It is hugely disappointing that this report reveals barriers to women taking on senior roles are still firmly in place,” she said.
This sentiment was echoed by Sophie Walker, chief executive of the Young Women’s Trust. “Women are tired of seeing reports pointing out that firms with more women at senior level post higher profits, but not seeing those jobs appear in reality,” she said, adding: “It makes good business sense to do this work, and at pace.”
The career progression challenges facing women were also highlighted by new figures released yesterday (24 September) by business diversity specialists INvolve and the HR Data Hub. They revealed that 77 per cent of people with salaries over £73,000 were men, and 56 per cent of those paid up to £17,000 a year were women.
Suki Sandhu, founder and CEO of INvolve, commented: “Despite the many initiatives to address gender inequality, it’s clear that there is still a shocking lack of women in senior positions which continues to drive a significant gender pay gap.”
He added: “‘With the delays to reporting on the gender pay gap this year, coupled with the negative impact of Covid-19 on pay equality, it’s vital that we continue to push for change.”