Some of the UK’s largest companies have been chastised by an influential investor group for failing to boost the number of women on their executive boards.
The Investment Association (IA), which represents investment managers, has warned 94 listed companies ahead of their annual general meetings that they are missing gender diversity targets by failing to achieve 25 per cent female representation on their boards, according to documents seen by The Guardian.
Of these companies, 46 were on the FTSE 250 and a further 11 were part of the FTSE 100, making them some of the UK’s largest companies.
Of the companies named, 74 were given an ‘amber’ warning by the IA, meaning their company board has less than 25 per cent women. These included Metro Bank, Ocado, Lloyds Banking Group and mining firm Glencore.
- Experts warn of ‘diversity fatigue’ as UK businesses tire of glacial pace of gender parity
- Government to focus on low-paid women rather than boardrooms in equality drive
- Many employers' gender pay gaps have widened – but is it their fault?
The other 20 companies, which included Domino’s Pizza, Millennium & Copthorne Hotels and gambling site 888 Holdings, were given a ‘red’ warning for having an all-male board or just one woman on the board.
The IA has confirmed to People Management the names of the companies on its list.
Andrew Ninian, the IA’s director of stewardship and corporate governance, told The Guardian they would continue to highlight businesses that fell short on their gender diversity targets.
“Evidence clearly shows that more diverse boardrooms make better decisions,” Ninian said. “Investors want to see greater diversity in the companies they invest in to ensure our savers and investors are getting the best returns possible.”
He added companies need to set out how they seek to improve their gender diversity or risk “revolts from investors who want to see a more diverse group of people around the boardroom table”.
Claire McCartney, diversity and inclusion adviser at the CIPD, said UK employers need to strive for greater gender diversity at all levels in organisations, but especially at the top.
"Organisations with gender diverse leadership teams outperform many of their rivals and often deliver increased financial returns,” McCartney said.
“It also sends a strong message to employees, and society in general, that they take gender equality seriously and support female progression throughout their organisation."
Gender diversity among senior business leaders has come under public scrutiny in recent years, with many top businesses lacking women in leadership roles.
While some businesses are still lagging behind, the latest Hampton-Alexander Review found that the UK’s 100 largest companies were on track to meet their target of women holding a third of board-level positions by 2020.
The independent review also revealed the number of all-male boards across the FTSE 350 fell from 152 in 2011 to just five in 2018, and highlighted the companies Next, Rightmove and Hargreaves Lansdown as all having boards with 50 per cent female representation. It also noted there were 76 companies in the FTSE 100 with three or more women on their boards.
But the review also found one in four FTSE 350 companies had only one woman on their board, and suggested it could take until 2035 before the proportion of women chairing boards reached the government’s target of 33 per cent.
Melanie Richards, deputy chair at KPMG, said in the report that the issue of female representation at board and senior levels has in the past been overlooked by business leaders “because the problem seemed insurmountable”.
“It has been a fight to change this perception, but over the past few years there has been a very noticeable shift. Change is happening,” Richards said.
She called on businesses to “redouble our efforts” and said business leaders should focus on all aspects of recruitment and retention, with an emphasis on creating an inclusive work environment and breaking down of leadership stereotypes as key for women to progress in business.