We advocate for a 40:40:20 target as a truly representative target for board gender diversity.
This recognises that with small or odd numbers of individuals on a board, a 50-50 split is unlikely. Therefore, a representative target is 40% male, 40% female and the remaining 20% naturally fluctuating either way.
As Women on Boards we have been calling for a 40:40:20 target since 2014. We believe this should be a cross-sector target, equally achievable for public sector bodies and listed firms. Significant progress has been made.
The Female FTSE Board Report 2016 published in July 2016 showed that women accounted for 26% of FTSE 100 board positions, up from 12.5% in 2011 and 7.8% of board positions in 2011 to 20.4% in 2016 within the FTSE 250. This demonstrated progress is possible when there is commitment to achieve it, however far more was needed. Progress continued, albeit slowly.
In 2021, our Hidden Truth Report called for a 40:40:20 gender balance target for boards across the FTSE All-Share.
Our 2021 Hidden Truth report examined the board diversity in the FTSE All-Share companies below the top 350. It found significant gaps between firms and overall gender diversity levels at 31% female. We recommended:
All FTSE All-Share firms can and should reach the ‘gold standard’ of truly representative gender balance at both senior executive and non-executive levels. It is vital that companies do not merely endorse this goal, but back up their ambition with a series of recruitment and retention targets linked to performance KPIs.
The FTSE Women Leaders review sets a truely representative goal of 40:40:20.
We were delighted to see the launch of the “FTSE Women Leaders Review” in late 2021 – a new government-backed monitoring of board diversity. Its predecessor, the Hampton Alexander Review, ended in early 2021, announcing its 30% women on boards goal had been met. The new FTSE Women Leaders Review goes beyond its predecessor, calling for a minimum of 40% women’s representation in FTSE 350 Boards and Leadership by the end of 2025. It also broadened its scope to consider the top 50 private sector firms.
We look forward to continued monitoring as firms progress towards this target.
Towards an intersectional approach
We believe efforts to monitor and scrutinise board diversity should be intersectional – across gender, ethnicity and other characteristics. Many Women on Boards members who are women from ethnic minority backgrounds fit into the categories for the both the government-backed FTSE Women Leaders Review and the Parker Review (on ethincity). For those women, an intersectional approach to diversity is not a theoretical concept but lived reality. Women on Boards strong supports an intersectional approach to diversity, as through our work with over 35 corporate partners, we have seen that this is the most effective approach to reap the benefits of diversity of thought in a truly inclusive culture.
The government-backed Parker Review‘s last report in early 2021 showed the goal around ethnic diversity – ‘one [director of colour] by 2021’ – remained unmet across the FTSE100, and progress towards the same goal by 2024 across the FTSE250 appears slower. We welcome this more challenging target of diversity around every board table, rather than the overall share across the FTSE 350, as the gender target focuses on. However, more and faster progress is needed to meet this goal.
If the situation is far from ‘job done’ with regard to gender diversity, it is even more unacceptable on ethnic diversity. A new report “Black Women in the U.K. Workplace” by the Black Women in Leadership Network offers some fresh evidence – there are still no black women on boards of FTSE 100 companies; 44% of black women do not believe they are offered the same professional development opportunities as their non-black female colleagues; over half black women in senior leadership roles have resigned due to racial bias in the workplace. Not only are these pressing concerns for black women, but they are relevant to the entirety of the workforce, constituting real and significant barriers to achieving diversity at all levels.