Women on Boards 2018: The Hampton-Alexander Review
In her capacity as Chair of Women in Banking and Finance (Glasgow), Laura Thorburn recently attended the Hampton-Alexander Review presentation. The review builds on the work of the Davies Review and sets out a number of recommendations aimed at increasing the number of women on FTSE Boards, with an important new focus aimed at improving the representation of women in leadership positions within FTSE 350 companies.
Fiona Cannon, Diversity and Inclusion Director at Lloyds, opened the event with a discussion of best practice common goals for the industry, including initiatives such as the Women in Finance Charter and mandatory Gender Pay Gap Reporting. Melanie Richards, Deputy Chair of KPMG, then gave an introduction to Scotland’s First Minister, Nicola Sturgeon.
The First Minister articulated the importance and on-going relevance of the review and highlighted some of the positive outcomes that we have seen to date: for example, the proportion of women on FTSE 100 Boards has risen from 12.5% in 2011 to 27.7% in 2017. She stated that the case for gender equality at a Board level is overwhelming, not simply as a moral issue, but also as a wider societal issue. She went on to describe the benefits of a society with transparent gender parity, including a more balanced approach across leadership and proportionate representation of customer and client segmentation.
The First Minister shared real optimism that, with focus and a concentrated mind-set shift, the targets set out by the review are achievable and could contribute significantly to business results. She also underlined the fact that this is a shared responsibility; no element of equality exists in isolation.
Sir Philip Hampton, Chair of the Review, and Denise Wilson, Chief Executive of the Review, urged the voluntary 33% target for women in senior positions at FTSE 100 companies by 2020 to be extended to senior executive leadership positions across the whole of the FTSE 350, the index which includes the 350 biggest publicly listed companies in the UK. Over the next three years, at least 40% of all appointments to senior positions would have to be filled by women if FTSE 350 firms are to hit the target.
Despite making strides towards greater diversity at Board level, the FTSE 100 still only had six female Chief Executive Officers during the fiscal year 2016. A persistent gender pay gap has also cast a harsh spotlight on diversity within the UK in recent months. Encouragingly though, the number of all-male FTSE 350 company boards has fallen from 152 to just 10 since 2011.
The main challenge outlined during the evening was how to continue to drive an increase in the proportion of senior executive positions held by women. As Lady Barbara Judge, the first female chairman of the Institute of Directors, recently stated “The main cause of the pay gap is the fact fewer women progress up the work ladder than men. Much more must be done to ensure more women reach the executive level.” The key to achieving this increased representation lies in ensuring that succession plans are diverse and consciously part of business planning and strategy.
As a Search organisation, Carlyle’s responsibility is to determine and source the best candidate for our client’s mandate. As part of this, it is also our duty to work with our client in developing a pipeline of diverse talent that enables them to build the senior teams and cultivate the skill-sets required to succeed. By employing a proactive, conscious approach to developing diverse senior leadership teams, businesses can contribute to ensuring that the positive trends outlined in the review continue to be supported and embraced at every level across their organisation.
Laura Thorburn is an Associate at Carlyle and specialises in the Investment and Asset Management sector, supporting technology innovations, strategic development and product functionality across Financial Products.
Laura is also Chair of the Glasgow branch of Women in Banking & Finance.
The full Hampton-Alexander Review can be downloaded from the Government website.